SAFTU concerned about ‘strings’ attached to World Bank loan
The World Bank has approved a R7.6 billion loan to South Africa following the government’ request for assistance in financing its vaccine procurement contracts.
The low-interest loan, which will be retroactive, will be used to buy some R40 million vales of Covid-19 vaccine.
While the loan has been widely welcomed, the South African Federation of Trade Unions (Saftu) says it believes the loan will compromise the country’s economic sovereignty.
“Our concern on compromising economic sovereignty are based on the premise that borrowing in foreign-denominated currency, always brings with it the possibility that we can default and such institutions can dictate our policy path.
“Treasury’s claims that the World Bank is a ‘cheaper’ lender are not true these loans have strings attached to them, commitment to structural reforms and fiscal consolidation that are bringing misery which is already unfolding.
“The recent statement announcing the new loan did not specify how much interest will the loan be charged on, for the public to independently assess whether the interest is fair or not.”
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