World Bank approves nearly R8 billion low-interest loan for South Africa’s Covid-19 vaccination program

The World Bank has approved a low-interest loan of €454.4 million (R7.6 billion) to help fund South Africa’s purchase of vaccines.

The government had asked for help to finance the purchase of vaccines. This loan will now be used retroactively to finance the country’s acquisition of 47 million doses of Covid-19 vaccine.

As of Monday, more than 36.4 million doses of Covid-19 vaccines have been administered, just over 50% of the country’s adults and 29.9% of 12 to 17 year olds have been vaccinated.

The Treasury and the World Bank said in a joint statement that more can be done to increase immunization coverage and boost South Africa’s economic recovery.

“The loan is part of the government’s efforts to reduce debt service costs by using cheaper sources of funding through multilateral development banks, while supporting the health system to respond to Covid-19 through the deployment of vaccines, critical research and treatment measures,” acting Treasury Director General Ismail Momoniat said in the statement.

The Treasury and the World Bank said the loan “contributes to the government’s fiscal relief program while reinforcing South Africa’s decisions on how best to provide relief to the economy and those most affected by the crisis. “.

“This support aims to put the country on a more resilient and inclusive growth trajectory by bolstering South Africa’s vaccination efforts against Covid-19 with the aim of vaccinating up to 70% of the country’s target population. “, said Marie Françoise Marie Nelly, policy officer at the World Bank. country director for South Africa.

“This project builds on our new World Bank Group Country Partnership Framework 2022-2026, jointly developed with the government in July 2021 to help spur investment and job creation.”

READ | SA to secure $750m loan from World Bank to boost economic recovery

In January, the World Bank approved South Africa’s request for a loan of $750 million (about R11.4 billion at the time) to support the country’s implementation of its recovery plan. reconstruction and economic recovery in the wake of Covid-19.

And in 2020, the International Monetary Fund gave SA a loan of $4.3 billion (about R70 billion at the time) to support job creation and the protection of businesses affected by the Covid pandemic. -19.

This was followed by a $1 billion (R14.5 billion at the time) loan from the New Development Bank (NDB) in 2021. The NDB is a development finance institution established by Brazil , Russia, India, China and South Africa as part of the BRICS grouping.

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