COVID-19: South Africa to save its economy with $26 billion package

COVID-19: South Africa to save its economy with $26 billion package

- South Africa is set to spend an estimated $26 billion on its plan to combat the spread of the coronavirus in the country

- The money would be sourced from existing budgets and borrowed funds from domestic and international markets

- The amount is about 10% of its Gross Domestic Product (GDP) and is likely to lead to an increase in government debt

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South Africa is set to revamp its economy and place it back on track with a $26 billion package.

The plan is to shore up the economy, which has been wrecked by the coronavirus and provide support for those who have been severely affected by the epidemic.

Sources of revenue for the plan include existing budgets and borrowed funds from domestic and international markets.

READ ALSO: Fitch gives Ghana a 'B' rating; expects a full recovery after COVID-19

There are also plans for guarantees for banks to encourage lending and the creation and protection of jobs, as well as packages for the poor and unemployed.

According to President Cyril Ramaphosa, the COVID-19 pandemic requires an economic response similar to in scale to its devastating effects.

He described the scale of the emergency relief as historic and pledged that all efforts to support and protect the people would be considered.

Per a Bloomberg report, the package is estimated to be about 10% of the country’s Gross Domestic Product (GDP) and is likely to lead to an increase in government debt.

South Africa’s Treasury, it has been reported, revealed that the country’s debt was already approaching unsustainable levels before the virus struck.

Meanwhile, South Africa is currently undergoing its 21-day COVID-19 national lockdown in an attempt to flatten the curve on the pandemic that has already killed more than 40 000 worldwide, caused markets to crash and set scientists scrambling for a solution.

While the lockdown has given some locals a moment to learn more about the new coronavirus, others have become dangerous ‘social media’ doctors by disseminating misinformed chain messages claiming to have found the cure – an anti-malaria drug.

Chloroquine is among a diverse range of medicines that are being investigated by international and local medical experts as a potential treatment remedy for the coronavirus.

READ ALSO: COVID-19: World Bank and IMF team up with others to provide relief for Africa

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Source: Yen

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