The International Monetary Fund (IMF) has approved a N$3.9 billion (US$270.83 million) loan for Namibia under its Covid-19 Rapid Facility.
“The Ministry of Finance wishes to announce the approval of US$270.83 million (about N$3.9 billion as at current exchange rate) by the International Monetary Fund (IMF) to address the fiscal financing needs caused by the COVID-19 pandemic,” the Ministry of Finance said.
The Ministry said the application was done last year from the Rapid Financing Instrument (RFI) availed by the IMF to middle-income countries. “The RFI provides rapid financial assistance to all IMF member countries (shareholders) facing financial headwinds and Balance of Payment challenges.”
“The Covid-19 pandemic and its fallout have created a situation where Namibia’s fiscal deficit is widening substantially, at the same time that the country’s receipts from exports of goods and services are contracting with consequent potential pressures on the external accounts. The funds will provide needed financing to respond to the COVID-19 health emergency, including the purchase of vaccines and deployment of the vaccination campaign, needed to mitigate the severe socio-economic impact of the pandemic.”
This is the first time that Namibia is taking a loan from this institution. “ It should be noted that this is not a normal IMF loan that comes with conditions. The repayment period of the loan is five (5) years at the interest rate of 1.1 percent. The Fund underscores the devastating impacts of the pandemic on many countries. So far about 85 countries in the world have benefited from IMF financial relief for COVID-19.”