The large volume of foreign capital outflow has compounded the country’s problems by reducing the amount of money in circulation and capital market liquidity. The Washington-based outfit, IMF, specializes in assisting countries through balance of payments difficulties but has developed a reputation for imposing stringent conditions on economically fragile nations. A prime example was the IMF’s role in deepening the recession in Greece following the 2008 financial crisis through its hard-line austerity measures. The IMF thought it would contract by just 5.5% and has since admitted to its role in underestimating the effects of austerity in Greece. In Africa, the IMF has mandated that Zambia reduces its subsidies by $ 1 billion, which may have a severe impact on both the education and health sector.

Source: The North Africa Journal October 12, 2016 18:00 UTC