South Africa is paying R500 million to participate in a consortium that is developing a COVID-19 vaccine, Finance Minister Tito Mboweni revealed on Tuesday.
Speaking during a Bloomberg Capital Markets Focus: South Africa webinar, Mboweni said this will ensure that South Africa is among the first countries to get the vaccine once it is found.
Additional R4.5b in 2021
He said, “South Africa is in a fortunate position [because] we have been invited to participate in the consortium that is looking for this vaccine.
“Already, a decision has been made that South Africa is paying R500 million to participate in the process of the production of the vaccine so that we can be in the frontline of those who receive the vaccine.”
Mboweni added that the government will pay an additional R4.5 billion to the consortium during the new budget process in 2021.
Although the Minister did not provide details of this consortium, a Ministry of Finance official confirmed to Reuters that he was referring to the COVAX vaccine distribution scheme.
This partnership scheme has been organised by the World Health Organisation (WHO) to ensure worldwide COVID-19 vaccine access.
Economic recovery
Mboweni said the potential vaccine is key to South Africa’s economic recovery prospects because it would eliminate the possibility of another lockdown.
The government implemented a hard lockdown earlier this year to contain the virus’ spread. However, this slowed down the economy significantly.
The National Treasury forecasts that the gross domestic product (GPD) will contract by 7.8 percent in 2020, while the SA Reserve Bank anticipates a 8 percent contraction.
South Africa is the hardest-hit in Africa in terms of COVID-19 cases, reporting more than 769,000 as of 23 November, 2020.
The virus has claimed the lives of 20,968 people in South Africa so far. Mboweni hoped that a second-wave of the pandemic does not happen.