IN CONVERSATION WITH : NEWTON MASUKU (National Spokesperson of SAFTU)
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The South African Federation of Trade Unions (SAFTU) has voiced strong concerns over a recent R26 billion loan granted to South Africa by the World Bank, warning that it could worsen the country's dependence on foreign creditors.
While the loan is intended to support structural reforms and infrastructure development, SAFTU argues that the long-term consequences could outweigh any short-term gains. The federation pointed to the negative impact of previous conditional loans, citing the creation of ArcelorMittal as an example of how such agreements can benefit corporations at the expense of public interest.
Zwelinzima Vavi, SAFTU’s General Secretary, criticized the loan, saying, “We believe this marks a return to the structural adjustment programmes promoted by institutions like the World Bank. These programmes often lead to commercialisation and privatisation of public infrastructure, prioritising corporate profits over the needs of the people. Moreover, loans denominated in foreign currency expose us to exchange rate volatility and introduce austerity measures disguised as fiscal discipline.”
SAFTU has called for more transparent and locally accountable economic strategies that prioritize social investment over debt-driven reform.
While the loan is intended to support structural reforms and infrastructure development, SAFTU argues that the long-term consequences could outweigh any short-term gains. The federation pointed to the negative impact of previous conditional loans, citing the creation of ArcelorMittal as an example of how such agreements can benefit corporations at the expense of public interest.
Zwelinzima Vavi, SAFTU’s General Secretary, criticized the loan, saying, “We believe this marks a return to the structural adjustment programmes promoted by institutions like the World Bank. These programmes often lead to commercialisation and privatisation of public infrastructure, prioritising corporate profits over the needs of the people. Moreover, loans denominated in foreign currency expose us to exchange rate volatility and introduce austerity measures disguised as fiscal discipline.”
SAFTU has called for more transparent and locally accountable economic strategies that prioritize social investment over debt-driven reform.