The World Bank has approved a loan of 750 million U.S. dollars to South Africa to fight COVID-19, the treasury said on Friday.
The national treasury said the development policy loan (DPL) would help tackle COVID-19, protect the poor and vulnerable from the adverse socioeconomic impacts of the pandemic and support a resilient and sustainable economic recovery.
“The World Bank budget support is coming at a critical time for us and will contribute toward addressing the financing gap stemming from additional spending in response to the COVID-19 crisis. It will assist in addressing the immediate challenge of financing critical health and social safety net programs while also continuing to develop our economic reform agenda to build back better,” said Dondo Mogajane, the director-general of the National Treasury.
The World Bank Country Director for South Africa, Marie Francoise Marie-Nelly, said the loan is part of the bank’s program to help stimulate investment and job creation.
“This support aims to put the country on a more resilient and inclusive growth path by leveraging South Africa’s strength to mitigate the effects of the COVID-19 crisis through their strong social safety net and by advancing critical economic reforms,” she said.
The loan comes ahead of finance minister Enoch Godongwana’s maiden budget speech in February, during which he is expected to announce several additional support measures for South Africans.
Social development minister Lindiwe Zulu has said that a new basic income grant in South Africa will likely be phased in over several years, with her department currently pushing for an extension of the R350 Social Relief of Distress (SRD) grant as a baseline.
“Depending on costs and the fiscal position of the country, it may take a few years to progressively implement. Until then, the department is, however, currently motivating for the extension of the Special Covid-19 SRD Grant, preferably over the medium-term period,” she said.
“This should provide the much-needed income support to cushion against the economic hardship occasioned by the advent of Covid-19 pandemic for the 18- 59 years.”
The R350 social relief of distress grant is currently set to conclude at the end of March 2022.
- Inside Politics and News Agencies
