EFF counters Ntshavheni's defence of $1.5 billion World Bank loan

CAPE TOWN - Minister in the Presidency, Khumbudzo Ntshavheni, has defended a $1.5 billion loan from the World Bank, saying it will unlock infrastructure “bottlenecks” in key sectors of the economy.

She says the loan, which translates to just more than R26 billion, will help create jobs and ensure a more inclusive economy.

But the Economic Freedom Fighters (EFF) has expressed its opposition to the loan, saying it will introduce legislation to restrict what it calls “reckless” borrowing from global financial institutions.

On Thursday, Ntshavheni told a post-Cabinet briefing that the Cabinet was updated on the US$1.5 billion development policy loan agreement signed between the South African government and the World Bank.

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Ntshavheni says the loan is aligned with the National Treasury’s intentions and forms part of the government’s broader efforts to implement structural reforms.

"And will be used to unlock key infrastructure bottlenecks, particularly in the energy and freight transport sectors. The loan support is anchored on three pillars of structural reforms: improving energy security, enhancing the efficiency and competitiveness of freight transport services and supporting South Africa’s transition toward a low-carbon economy, which are the backbone of government’s priority of inclusive growth and job creation."

But EFF MP Sinawo Thambo expressed the party’s opposition to the loan during the National Assembly debate on the Division of Revenue Bill.

"Now as the EFF, we have introduced the Public Finance Management Amendment Bill, which will restrict reckless and irresponsible borrowing from financial institutions globally."

Thambo says there must be an authority in Parliament to guide all loans conducted by the State.