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.

Addressing 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.”

Advertisement

“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.

The lockdown regulations prohibit local and international travel; gatherings of more than 50 people, including at funerals; and only essential services may operate under limited conditions.

Citizens also have to remain in their homes and may venture out only to buy food or for medical reasons

Ramaphosa said the country was embarking on a phase aimed at stabilising the economy and address the decline in supply and demand and protect jobs.

The unemployed and workers whose employers have been able to pay their wages, will also get relief from the fund.

The unemployed and workers whose employers have been able to pay their wages, will also get relief from the fund.

An official study published earlier in the said found that almost two-thirds of businesses believed the pandemic would have a “substantially worse impact” on their business compared with the 2008/9 financial crisis.

The country has so far reported 58 deaths out of 3,465 coronavirus infections, slightly behind Egypt.

Globally, 2,557,837 people have been infected and 177,674 have died so far, according to Worldometer. Countries hit with most number of cases are the US (804,194), Spain (204,178), Italy (183,957), France (156,495) and Germany (148,007).