Victoria did not take an IMF ‘bribe’ in return for lockdown

AAP FactCheck September 24, 2020

The Statement

A Facebook post accuses Victorian Premier Daniel Andrews of overborrowing, forcing his state to be “in default” to the International Monetary Fund (IMF). The post goes on to suggest the claimed financial strife might behind Victoria’s strict coronavirus lockdown.

The post, shared by celebrity chef Pete Evans, features a picture of the premier accompanied by a series of claims that he has sold various assets to China.

The post goes on to say that Mr Andrews had “borrowed too much and now can’t pay the interest on the loan, now Victoria is in default to the IMF”.

“Did Premier Andrews accept the multi million dollar bribe from the IMF, conditional on Andrews locking down the state of Victoria unnecessarily?,” it adds.

In his caption, Evans poses the question: “True or false? A simple search will give you the answers. Then look into NZ.”

At the time of writing, the September 22 post had been viewed more than 56,000 times and shared more than 490 times, attracting more than 1400 reactions and 350 comments.

Facebook post falsely claiming Victoria is in default to the IMF.
┬áA Facebook post falsely claims Victoria is “in default” to the IMF.┬á

The Analysis

While Victoria’s economy has been significantly impacted by the COVID-19 pandemic, the state has not borrowed money from the IMF – which only lends to national governments – nor is it in default.

Both the International Monetary Fund and Victorian government confirmed the IMF claim was false when contacted by AAP FactCheck.

To battle the coronavirus pandemic and its deadly second wave, the Victorian government passed emergency legislation to make up to $24 billion available for business support and stimulus.

However despite the economic hit, the state government has been able to borrow money on financial markets at minimal costs.

According to the Treasury Corporation of Victoria, which handles the state government’s borrowing, the interest rate on its three-year bonds was 0.31 per cent at the end of August – down from the rate in July, and only slightly above the rate for the equivalent federal government bonds.

The IMF, which is responsible to 189 member countries including Australia, is tasked with maintaining stability in the international financial system. In doing so, it provides emergency loans to countries struggling to pay their debts, often in cases where they are unable to borrow affordably on international markets.

As of August 31, the IMF had outstanding loans to 90 members, which are mostly developing countries and financial crisis-hit nations such as Argentina. Neither Victoria nor Australia appear on the list.

An IMF spokesperson told AAP FactCheck in an email the organisation does not lend money at state, provincial or municipal levels, and it works exclusively with national governments.

“The state of Victoria has neither borrowed money from the IMF nor is it in default to the Fund,” the spokesperson said.

A spokesman for the Victorian government also rubbished the post’s loan default and “bribe” claims. “These claims are completely and utterly false,” he told AAP FactCheck via email.

The post also includes a number of other false or misleading claims about Victoria and Mr Andrews’ dealings with China.

While it correctly states the premier signed the state up to the Belt and Road initiative, it falsely says that he “sold the rights to water to China” and “sold the farms to China”, among other allegations.

Just 3.4 per cent of Victoria’s total water entitlements on issue were owned by any foreign entity in June 2019, the lowest share for any Australian state, according to the national register.

Similarly, only 5.7 per cent of Victoria’s agricultural land area was held by any foreign interest, according to the most recent register. That was the second-lowest share for any state, behind only NSW/ACT. The registers do not provide state-level figures for the sources of foreign ownership.

Police patrol Melbourne's Flinders Street station.
 A post alleges a bribe from the IMF was conditional on Premier Daniel Andrews locking down Victoria. 

The Verdict

The state of Victoria has not borrowed money from the IMF nor is it in default, AAP FactCheck has determined. There is no factual basis to the claim that Victorian Premier Daniel Andrews accepted this financial “bribe” in return for locking down the state.

False – The primary claim within this Facebook post is inaccurate.

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