In what can be seen as a reversal of roles between African countries and the IMF, South Africa has committed to invest $2 billion of its reserves to the International Monetary Fund’s firewall fund. South Africa will be investing along with its fellow members of the G20 and is currently the only African country in the G20. South Africa is currently also the only African country in the BRICS.
According to the Government of South Africa, the money will reportedly be drawn down only if it is needed. ”They [funds] will be drawn down only if they are needed and only after other resources have been depleted. The funds will be invested and earn interest, and would only be drawn down in emergency circumstances. If the funds are drawn down, they will ultimately be repaid and they will continue to earn interest over this period,” said the South African Presidency.
South Africa’s President, Jacob Zuma has previously remarked that the vulnerability of several large European economies pose severe negative implications for the global economy. He has thus urged Europe to work together to resolve their debt problems.