No SA bailout for Zim after Ramaphosa visit

South African President Cyril Ramaphosa arrives to the parliament in Cape Town for the 2019 State of the Nation address (NASIEF MANIE/AFP/Getty Images)
South African President Cyril Ramaphosa arrives to the parliament in Cape Town for the 2019 State of the Nation address (NASIEF MANIE/AFP/Getty Images)

President Cyril Ramaphosa concluded a much-anticipated visit to Zimbabwe on Tuesday, dashing any lingering hopes that his country would bail out its economically-troubled neighbour.

Ramaphosa commended the new administration of Emmerson Mnangagwa for its bid to revive the economy and promised to explore a number of options of financial help.

But otherwise he made no concrete offer of help, voicing a "commitment to work with Zimbabwe in addressing the socio-economic challenges".

"South Africa stands ready to render support to Zimbabwe within our means in your quest for economic renewal," he said, during the talks held at a Harare hotel.

Last year Zimbabwe requested $1.2 billion in emergency credit from South Africa, but Pretoria indicated it did not have the funds.

In a joint statement issued after the 24-hour visit, the two governments said they were exploring ways to help Zimbabwe financially.

One of them would be a loan facility from South African private banks to the Zimbabwe private businesses.

The loans will be guaranteed "by the South African government with an appropriate counter-guarantee from the Zimbabwe government," said the statement.

An almost similar deal was struck last month with the diamond-rich Botswana, involving a $100-million credit from private banks in both countries but available to Botswana private companies doing business in Zimbabwe.

"We're not giving them a single loan," President Mokgweetsi Masisi said in Gaborone after a visit to Harare, dismissing media reports that the credit was being made available by the state.

Mnangagwa took over after long time ruler Robert Mugabe was forced to resign in 2017, but is struggling to solve Zimbabwe's economic crisis.

In January this year, crowds took to the streets to protest after Mnangagwa more than doubled fuel prices.

The military and police quelled the demonstrations, leaving at least 17 people dead and hundreds wounded.

South Africa has borne the brunt of economic and political troubles in Zimbabwe. Millions of Zimbabweans have fled to South Africa following decades of economic turmoil.

"What affects one, affects the other. Economic prosperity in one country has a stimulus effect on the other. Likewise economic regression has a pull down effect on the other," said Mnangagwa.

Ramaphosa has led calls by African leaders for the lifting of years-long sanctions imposed by Western powers over rights abuse under Mugabe's regime.

"We have been calling for those sanctions to be removed immediately because they impede the growth of the Zimbabwean economy and they also are having an adverse effect on the ordinary people of Zimbabwe," Ramaphosa reiterated on Tuesday.

ZAR/USD
17.07
(+0.51)
ZAR/GBP
21.38
(+0.63)
ZAR/EUR
19.26
(+0.43)
ZAR/AUD
11.85
(+0.51)
ZAR/JPY
0.16
(+0.48)
Gold
1798.98
(+0.27)
Silver
18.39
(+0.82)
Platinum
840.00
(+0.42)
Brent Crude
42.97
(-0.05)
Palladium
1918.00
(+0.57)
All Share
55733.25
(+0.89)
Top 40
51428.10
(+0.99)
Financial 15
10292.16
(+2.03)
Industrial 25
77887.02
(+1.34)
Resource 10
52019.59
(+0.00)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Please select an option Oops! Something went wrong, please try again later.
Results
I'm not really directly affected
18% - 1749 votes
I am taking a hit, but should be able to recover in the next year
23% - 2291 votes
My finances have been devastated
34% - 3429 votes
It's still too early to know what the full effect will be
25% - 2471 votes
Vote