South Africa plans to announce a $20.5 billion (R357 billion) infrastructure programme after talks with the private sector and multilateral lenders as part of its attempt to recover from the coronavirus epidemic.
The programme will focus on “network industries such as rail and ports, energy, broadband connectivity, water, sanitation and human settlements,” Paul Mashatile, treasurer-general of the ANC, said in a speech to London’s Chatham House.
“About 1.8 million jobs will be lost during this period, mostly among the youth,” Mashatile said. “This is why we will have to push for massive infrastructure spending within labor-intensive sectors.”
South Africa has announced a R500 billion ($29 billion) stimulus programme to help the recovery of an economy the National Treasury forecasts may contract as much as 16% this year. The country may need $100 billion to recover from the coronavirus outbreak, Mashatile said.
“Government is already in discussion with international partners such as the International Monetary Fund [IMF], the World Bank, the New Development Bank and the African Development Bank to raise $27 billion as part of our immediate response to the pandemic,” he said.
That figure is significantly higher than Treasury’s estimate of about $5 billion it expects to get from international finance institutions.
“Government, through the Department of National Treasury, is exploring all funding avenues to finance all Covid-19 related programmes and measures aimed at addressing the pandemic,” Treasury said in a response to questions. “The funding avenues will not be limited locally, but will include exploring all global partners. Funding transactions will be announced officially once concluded.”
South Africa has in the past opposed borrowing money from the IMF and World Bank, saying such lending programs could compromise sovereignty.
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