SA scores another R14b COVID-19 loan from BRICS New Development Bank

BRICS bank $1 billion loan to South Africa
Image credit: Flickr/GovernmentZA

South Africa has scored another $1 billion loan (approximately R14.5 billion at current exchange rates) from the BRICS New Development Bank.

In a statement on Thursday, the Bank said the loan is a “COVID-19 Emergency Program Loan” aimed at supporting supporting South Africa’s economic recovery.

Financing employment opportunities

“The loan will support the government of South Africa in its efforts to contain the economic fallout of the pandemic and start economic recovery,” it explained.

“The loan will finance creation of employment opportunities in South Africa, in particular the first phase of the Presidential Employment Stimulus (PES) aimed to create and support about 700,000 job opportunities in the public sector, together with social protection measures for active labour market participants that temporarily lost their jobs, in order to help them remain in the labor market.”

This is the second COVID-10 loan the bank has approved for South Africa. The first, also $1 billion (around R17 billion at the time), was approved in June 2020.

It was aimed at funding the government’s healthcare response and providing a social safety net for the most vulnerable groups through social grants.

$10b emergency facility

The New Development Bank was established by the Brazil, Russia, India, China and South Africa (BRICS) formation to mobilise resources for infrastructure and other development projects.

In April last year, it established a $10 billion Emergency Assistance Facility to provide crisis-related assistance to its member countries.

Of this, $5 billion was disbursed in the first round of assistance last year, while the remaining $5 billion is being disbursed this year.

Be the first to comment

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.