South Africa: President Ramaphosa Unveils $26 Billion Covid-19 Relief Plan  

On Wednesday night Ramaphosa announced a social and economic relief package worth $26bn to cushion the continent’s most industrialized economies.

“The pandemic requires an economic response that is equal to the scale of the disruption it is causing,” he said in an address on national television on Tuesday, pledging to “address the extreme decline in supply and demand and to protect jobs”.

That response is equivalent to 10% of GDP, and has seen Pretoria approach global finance institutions such as the World Bank, International Monetary Fund and African Development Bank – primarily to fund health care interventions.

However, some South Africa’s senior officials in the ruling African National Congress and its alliance partners have shot down a suggestion by Finance Minister Tito Mboweni that the government might seek help from multilateral lenders for health funds, saying the structural adjustments associated with loans from the institutions would undermine the nation’s sovereignty.

The Coronavirus lockdown is set to continue until May 1. While painful, it has been “absolutely necessary” to save tens of thousands of lives, Ramaphosa said. The loosening of the lockdown will take a “risk-adjusted approach”, he added.

The rest of the package is made up of 130 billion rand from reprioritised spending and other local sources and 200 billion in loan guarantees in partnership with the central bank, finance ministry and commercial banks.

The guarantees will support more than 700,000 businesses and some banks will start implementing them by the end of the month, Ramaphosa said.

Meanwhile, the South African authority has announced extra troops will be deployed in the country in order to help enforce a lockdown as a measure to stop the spread of coronavirus. President Ramaphosa said he had decided to deploy an extra 73,180 soldiers in a letter addressed to parliament on Tuesday.

South Africa has some of the most stringent coronavirus lockdown restrictions in the world. But security forces have struggled to enforce them. The lockdown restrictions currently apply until Thursday 30 April when President will then set out how the lockdown will be lifted. The country is considering introducing flexible restrictions on economic activity after it phases out a nationwide lockdown.