South Africa needs all the help it can get to rebuild its economy after the Covid tsunami – and a new initiative by the World Bank provides cause for some optimism.
The new World Bank Group Country Partnership Framework (CPF) is aimed at supporting cooperation with South Africa in its efforts to stimulate investment and job creation as the country recovers from the impact of the Covid-19 pandemic on lives, livelihoods, and the economy. The strategy covers five years from 2022 to 2026 and has been endorsed by the Group’s Board of Executive Directors.
The new CPF is aligned with the South Africa’s priorities as contained in the Economic Reconstruction and Recovery Plan (ERRP), the State of the Nation Address (Sona) of 2020 and 2021, and the country’s long-term vision in the National Development Plan (NDP) 2030.
It is also informed by consultations with a broad range of stakeholders and the findings of both the World Bank Group’s Systematic Country Diagnostic (SCD), and the Country Private Sector Diagnostic (CPSD), which align with the country’s own diagnostics of the persistent triple challenge of poverty, unemployment, especially high among youth, and inequality, all made worse by the pandemic.
“We welcome the World Bank Group’s alignment of the CPF with South Africa’s development and investment objectives of creating a sustainable, resilient and inclusive economy,” said Dondo Mogajane, director general of National Treasury of South Africa.
“We look forward to tapping into the World Bank Group global experience and expertise in achieving our country’s objectives."
This strategy is designed to offer a World Bank Group package of knowledge programmes primarily from the International Bank for Reconstruction and Development (IBRD) and financing for private sector development by the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (Miga) for investment both into South Africa and cross-border into the rest of the African continent.
“This CPF charts a path for how the World Bank, IFC and Miga will leverage their relative strengths to partner with South Africa for stronger development outcomes,” said Marie Françoise Marie Nelly, World Bank country director for South Africa, Botswana, Eswatini, Lesotho, and Namibia.
“As the World Bank Group, we will continue to support the government in addressing both short-term Covid-response needs and key long-standing constraints to sustainable and inclusive economic growth and development.”
The WBG will focus on three broad areas under the new CPF: (i) increased competition and an improved business environment; (ii) strengthened micro, small, and medium enterprises and skills development to boost job creation; and (iii) improvements in the infrastructure investment framework and selected infrastructure services.
South Africa is the IFC’s largest client in sub-Saharan Africa with a portfolio of $2.4 billion as of June 30, 2021. South Africa is also Miga’s largest client in Africa and the third-largest worldwide portfolio of $1.6 billion.
