The National Treasury is looking to raise R95bn from multilateral institutions and development banks for business support, job creation and protection of existing jobs in the midst of the Covid-19 crisis.
This R95bn will contribute to the R500bn stimulus package announced by President Cyril Ramaphosa, with R200bn being allocated for the national credit guarantee scheme; R130bn coming from the base reprioritisation of budgets; R60bn from additional transfers from social security funds; and R15bn from available funds from the department of social development.
Mogajane said it is likely that the recession will be the worst since the Great Depression. The Treasury has forecast a contraction in GDP of 5.4% this year if the pandemic is contained quickly and the economy bounces back; a contraction of 12.1% if the pandemic takes longer to contain and the economic recovery is slower; and a contraction of 16.1% if the pandemic endures even longer and recovery is spread over a longer period.
The comments were made during a briefing by the Treasury to a joint committee of parliament’s two finance committees — the appropriations committee and the standing committee of public accounts — on the fiscal implications of Covid-19 and the interventions to save and stimulate the economy.
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