About That World Bank $1.5 Billion Loan

The Economic Freedom Fighters (EFF) notes, with serious concern, the announcement by the National Treasury that South Africa has signed a loan agreement to the amount of US$1.5 billion with the World Bank for so-called infrastructure modernisation and development.

The EFF reiterates its long-held position that institutions such as the World Bank and International Monetary Fund (IMF) are instruments of neoliberalism and neocolonialism, used by Western imperialist powers to perpetuate the underdevelopment of the global South, and Africa in particular. These institutions mask their agenda through development rhetoric, while attaching loan conditions that undermine sovereignty, impose austerity, and erode the developmental state. The National Treasury, acting as a conduit for this imperial agenda, often conceals these conditions or frames them as mere administrative reforms, when in reality they fundamentally shape economic policy and fiscal direction without democratic consent.

We maintain that South Africa’s debt-service costs have now ballooned to over R426 billion per year—more than what is spent on social development, health, or basic education. Yet, we have nothing to show for this debt in terms of real, transformative development for our people. Over the past 15 years, the National Treasury has borrowed billions in the name of economic reform and stability but failed to ensure that such debt translates into jobs, industrial growth, or public infrastructure that benefits the majority of our people. Instead, debt has enriched consultants, emboldened technocrats, and tightened the grip of international capital on our national policy agenda.

The EFF is deeply concerned by the rising trend of foreign-denominated loans, particularly when there is sufficient liquidity in the domestic financial market and alternative monetary policy interventions that remain unexplored. These loans appear politically motivated and are designed to entrench long-term conditionalities that will bind future governments and constrain sovereign policy space. This is a betrayal of intergenerational equity and a reckless act that mortgages the country’s future to Washington and Brussels.

The EFF has therefore written to the Speaker of the National Assembly to formally introduce amendments to the Public Finance Management Act of 1999. These amendments will place strict limits on the Executive’s borrowing powers, particularly those of the Minister of Finance, by requiring prior approval of all foreign loans by Parliament. Crucially, the amendments will also mandate full public disclosure of all terms and conditions attached to these loans, including policy undertakings, letters of intent, and restructuring requirements.

The EFF will continue to resist the recolonisation of our country through debt and defend the constitutional principles of transparency, accountability, and democratic governance.

The EFF’s colors are red, black, and green, symbolizing its commitment to socialism and African nationalism.

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