Africa: IMF takes centre stage

Events this month have underlined the continuing importance of the IMF for many economies across Africa. On 6^th April the government of Angola requested an IMF bailout to help stabilise an economy that has been battered by low oil prices. This marks a significant policy shift for Luanda, which has preferred to rely on Chinese loans that come with fewer strings attached. The Zambian authorities are currently negotiating a similar deal, though an agreement has yet to be announced. Ghana signed an agreement with the IMF in early 2015, while Kenya has a stand-by arrangement. The continued use of IMF loan deals, which often come with painful policy conditions, signifies that the role of the Fund has not, as was sometimes assumed, been taken by China and other state lenders. When the going gets tough, African states still look to Washington rather than to Beijing. The IMF’s supervisory role was also highlighted this month after news that the Mozambican government had provided an incomplete account of its foreign borrowing caused the Fund to cut off loan disbursements. The government has now pledged to come clean, providing the IMF with details of its off-book borrowing, which will play a key role in analysing the real state of Mozambique’s finances.