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Country-wide restrictions resulted in a slowdown of economic activities, due to disruption of supply chains and trade channels, subdued business and consumer confidence, a higher degree of risk aversion, and more cautious consumption patterns. The pandemic exacerbated South Africa’s pre-existing crises of poverty and unemployment.
In response, the Government of South Africa (GoSA) implemented the Presidential Employment Stimulus (PES) and temporary social assistance programs, to stimulate economic growth and alleviate poverty, with the launching of the comprehensive mid-term strategy, the Economic Reconstruction and Recovery Plan (ERRP) in October 2020.
The ERRP embraced multiple sectors of the country’s economy with emphasis on employment generation, with the PES being the priority. Against this backdrop, NDB approved the economic recovery program to support GoSA with the implementation of the PES and temporary social assistance programs (hereinafter – the Program).
The Program was designed to protect the poor and vulnerable from the adverse socio-economic impacts of the COVID-19 pandemic, and to pave the way for a resilient and sustainable economic recovery. It supported the GoSA in creating employment opportunities through the PES and provided temporary social assistance for those who temporarily lost their jobs during the pandemic, helping them to reintegrate into the labor market.
The program contributed to efforts by the GoSA to ensure that the country’s social protection was sufficiently supported to withstand the negative socioeconomic effects of the pandemic. The program achieved the expected outcomes, namely, employment created under the PES program and number beneficiaries that received the CSRDG.
The program design also integrated gender features to support women and vulnerable groups during the pandemic, such as (i) loss of livelihood support; (ii) reduced food security and (iii) other features, like youth unemployment.
NDB’s financing under the Program was aligned with SDG 8, created full and productive employment and decent work for all.
The Program implementation arrangements relied on the existing government structures established in South Africa. The main sub-program related to the creation of employment opportunities was coordinated and overseen by the Project Management Office in the Presidency of the Republic of South Africa and implemented by 11 relevant departments of GoSA.
The departments worked in collaboration with the PMOP and the Department of Planning, Monitoring and Evaluation to ensure effective implementation of the program.
The supporting sub-program related to temporary social assistance was implemented by the DSD through the government owned SASSA, which has multiple offices located throughout the country.
The Program was categorized Category B at the appraisal stage in line with NDB’s Environment and Social Framework (ESF) and remained the same through to the completion stage. The environmental and social risk of the Program was maintained at B-1 “Low Risk” throughout the implementation.
The main Environmental and Social (E&S) impacts associated with the Program were related to minor pollutant emissions from construction activities, which were managed through compliance with national regulations and industry standards.
In addition, the Program had a good socioeconomic impact by creating work opportunities, maintaining employment levels, providing public services, and supporting the vulnerable groups. Environmental services such as wetland restoration and watershed management provided jobs while providing more and higher-quality water, which is not only program necessary for survival but also a direct prerequisite for economic growth.
The NDB loan amount of USD 1 billion was fully disbursed in accordance with the provisions in the Program’s Loan Agreement. | ||
Source of Fund | Amount (USD billion) | |
NDB | 1 |
NDB | Borrower and Project Entity |
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Africa Regional Centre
Tshifhiwa Mukwevho |
National Department of Health and Department of Social Development of South Africa
Wanga Cibi |