South Africa’s President Cyril Ramaphosa on Tuesday announced a $26 billion relief package aimed at stimulating the economy and cushion the vulnerable people during the coronavirus pandemic.
In a special address to the nation, Ramaphosa announced “a massive social and economic support package of 500 billion rand ($26.3 billion), which amounts to about 10 percent of our GDP.”
“The impact of the coronavirus requires an extraordinary coronavirus budget…the scale of this emergency programme is historical,” he said.
Before the virus arrived last month, Africa’s most advanced economy was already reeling from a recession, deteriorating public finances and a swollen budget deficit.
The economy which grew by a paltry 0.3 percent last year, is now expected to contract by 6.1 percent, according to the central bank.
Ramaphosa said a portion of the virus relief funds will be redirected from the current budget and the rest would be sourced from the local unemployment insurance fund and from global partners and international finance institutions.
South Africa is in its fourth week of a five-week lockdown imposed expected to run to the end of April.
With
many people out of work or companies shut down to observe the lockdown
“poverty and food insecurity have deepened dramatically in the course of
just a few weeks,”
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