Cape Town. 120502. Ronald Lamola, ANCYL deputy president speaks at UCT. Reporter Aziz Hartley. Picture Courtney Africa

The ANC Youth League is shocked by the government's readiness to commit US2 billion (about R16.58 billion) to the International Monetary Fund.

“This is rejected in the highest terms due to the reality that as we commemorate youth month in South Africa, millions of young people are unemployed, face extreme poverty and economic inequalities,” the league said in a statement on Wednesday.

The Treasury said on Tuesday that the money was put towards an IMF “firewall” meant to prevent future financial crises. President Jacob Zuma made the commitment at the G20 summit, a meeting of the world's greatest economies, in Los Cabos, Mexico.

“If the IMF uses the funds, the money is lent to the IMF and not a gift... (and) for all of this time the money will be earning interest for South Africa,” President Jacob Zuma's spokesman Mac Maharaj said on Tuesday.

“The capital of the loan will ultimately be repaid to South Africa. It's like lending money to a very strong bank. This is not a risky loan.”

The ANCYL condemned the move, saying the IMF had not made any significant improvement to the lives of South Africans.

“The IMF refuses reform, is committed to imperialism and continues to protect an old guard that perpetuates resistance to change.”

It would have been more appropriate to use the money for education and to create employment for young South Africans. The league said the South African government's approach to international matters should not be at the expense of its own people. - Sapa