The International Monetary Fund (IMF) Executive Board has approved a $4.3 billion loan for South Africa to help the country weather the Covid-19 health crisis on the economy.
National Treasury made the announcement late on Monday.
It also said that this was a low-interest loan that would contribute to the government’s fiscal relief efforts without impacting on its sovereignty.
South Africa has been driven deeper into an economic recession by the health crisis and government reached out to international financial institutions, including the World Bank, for backing for a R500 billion package to shore up the economy.
Welcoming the approval of the loan, Finance Minister Tito Mboweni said Government’s Covid-19 economic support package directs R500 billion straight at the problem.
Mboweni is on record saying once the IMF loan was in hand, he expected the World Bank to approve special funding of its own for South Africa.
The economy is expected to contract by 7.2% in the current financial year, the biggest shrinkage in 90 years.
