R7.6bn World Bank loan ‘a drop in the ocean’ - economist
The World Bank has approved a loan worth R7.6 billion for South Africa’s Covid-19 vaccine procurement.
Government made the request, saying the assistance would help finance vaccine procurement contracts.
National Treasury says the loan forms part of government's efforts to reduce debt service costs by making use of cheaper sources of funding through multilateral development banks.
The loan will retroactively finance the procurement of 47 million coronavirus vaccine doses.
Chief economist at Econometrix Azar Jammine says the R7 billion is a drop in the ocean when compared to government’s total debts of R4 trillion..
“Any money lent to the government at a relatively low interest rate is worth taking, so purely based on that, it is welcomed.
“Checks and balances will be put in place to ensure that the government does not use the money for stuff not related to Covid-19.”
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