African countries loaning money to African countries? Advisable?

As we all know by now, Zimbabwe has been struggling financially for quite a while now and has had to use many different currencies in order to stabilize the country and help its people survive. Many international countries have helped Zimbabwe financially over the past few years, but not only from the international community, but also South Africa. South Africa has helped Zimbabwe a great deal, which is surprising, but also very encouraging to see. According to fin24, “South Africa has approved more $100m (R905m) in budgetary support to cash-strapped Zimbabwe, helping plug a gap in its finances ahead of elections expected in the second half of the year, Finance Minister Tendai Biti said on Monday (15 April 2013)”.

 

Biti goes on to say that the South African cabinet has made a decision and feels that it is a “positive” one. Yes, it is a very positive call on Zimbabwe’s behalf, but how about South Africa? Not only the effects on the economy of South Africa but also its people? To be honest, South Africa could do with that extra R905million that they ‘loaned’ to Zimbabwe. South Africa is not as stable as it could or should be. The cabinet of South Africa does not need the consent from its people of the country; however, they should take them into consideration. I personally feel that the needs of South Africa’s should come above anyone else. For instance, there are many homeless, starving and sick citizens across South Africa that could easily be cared for with this lump sum of money. The issues of rape and murder could be decreased with money spent on more hidden cameras or more of the police force patrolling.  These are only a few examples that could be improved in South Africa. This decision that the South African cabinet has made may cause many citizens to get upset. They may turn around and say that they want to pay less tax seeing as the country has enough money to support another country.

 

In saying this, I am also very pleased to see that Zimbabwe will be receiving more funds into the country so that they will be able to hold the planned elections in July 2013. Zimbabwe should in fact get as much funds as possible in order to ensure that the elections do run as smoothly as hoped, with many officials overlooking the procedure, and hopefully minimizing the violence and ability to cheat. Zimbabwe should however not agree to the contract of a “loan” if they may not be able to repay the money to the countries that lent them the funds. This will cause great violence and tension, and Zimbabwe may end up in bigger trouble than it already is. The other problem that Zimbabwe also needs to try and resolve is the fact that the amount of money leaving the country for food imports exceeds the amount coming in. the government should rather leave it up to the private farmers to import and export their goods, rather than the government itself and its revenue.

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