Pandor says R50m donation to Cuba not linked to R350m assistance package

Minister Naledi Pandor.
Minister Naledi Pandor.
  • A R350 million Economic Assistance Package (EAP) was concluded between the Cuba and SA in 2012.
  • AfriForum and the DA appeared to have conflated the R50 million donation and the R350 million package.
  • The R50 million donation is the subject of a court battle.

International Relations and Cooperation Minister Naledi Pandor says there is no link between the government's R50 million donation to Cuba and the R350 million Economic Assistance Package (EAP) to the Caribbean dictatorship.

The R50 million donation is currently the subject of a court battle between the government and AfriForum, which wants to stop the donation payment.

On Tuesday, News24 reported that government wanted to give this donation to Cuba over and above a loan of R84.6 million that it granted to Cuba last year.

Cuba still had R55.4 million left on this line of credit, but the government decided to give Cuba the donation instead.

This R350 million deal was completed in 2012, two years after corruption-accused former president Jacob Zuma visited Cuba and was meant to help the country recover from devastating hurricanes that hit the Caribbean in 2008.

An internal memorandum recommending that the government provide the R50 million donation contained in the court papers, included a note handwritten by Pandor, suggesting that former finance minister Tito Mboweni preferred a loan.

Pandor wrote:

MOF [Minister of Finance, Mboweni at the time] seemed to prefer a loan arrangement when we spoke, however, I support this route.

READ | Government's planned R50m gift to Cuba comes on top of R84m loan already extended to country

Furthermore, in current Finance Minister Enoch Godongwana's positive response to Pandor's request for the donation, he suggested that Cabinet discuss how it could "extend the financial assistance to Cuba beyond this requested assistance, which could be multi-year".

After finding the reference to the R350 million EAP in the court documents, AfriForum and the DA appeared to be under the impression that the R50 million donation was part of this.

"It is now clear that the government is actually planning on donating more than a quarter-billion rand to Cuba. This contract to donate R350 million does not accord with the laws of South Africa, and it is completely irrational to make such an exorbitant donation in these difficult times," AfriForum's Reiner Duvenage said in a statement.

DA MP Ashor Sarupen said in a statement: 

The DA has today [Monday] written to the chairperson of the Appropriations Committee, Hon. Sfiso Buthelezi MP, to summons the Department of International Relations and Cooperation to appear before the committee to explain why, based on information exposed in court filings, it intends to donate R350 million to Cuba.

On Tuesday, Department of International Relations and Cooperation spokesperson Clayson Monyela released a statement, saying Pandor clarified that there was no link between what was currently before the courts - the R50 million donation - and the EAP of R350 million to Cuba signed in 2012.

He noted that Pandor had responded to a Parliamentary question from the DA on the EAP signed on 3 February 2012 in Pretoria.

Pandor indicated that the EAP consisted of three facilities:

  • Facility A of the Package (a grant of R40 million for the purchase of seeds);
  • Facility B (a solidarity grant of R100 million for the purchase of goods in the South African market) which has been implemented and completed; and
  • Facility C, which was a credit facility amounting in total to R210 million for the procurement of South African goods, split into two tranches as per the signed Agreement.

"The first tranche (Tranche A) of R70 million under Facility C was available immediately on entry into force of the agreement; and the second tranche of R140 million became available after the repayment of the initial R70 million," Monyela's statement pointed out.

"For the first tranche of R70 million, only R63 million was requested for disbursement and the loan was fully repaid. Access was then granted to the second tranche (Tranche B) of R140 million.

"The government of Cuba repaid the first tranche with interest in June 2019. The second tranche was then granted in 2021. The second tranche is payable bi-annually. The first instalment date was 31 December 2021 and the last instalment is due on 30 June 2026."

READ | Court dismisses govt's application to appeal AfriForum interdict on R50m Cuban donation

"The EAP expired on 17 July 2021, but in terms of Article 11 of the agreement, the agreement will remain in force until all obligations of the parties have been fulfilled. Therefore, as far as the repayment of the money under Facility C is concerned, the agreement will remain in force until the money is repaid by Cuba."

Monyela's statement failed to say how much was loaned to Cuba in terms of the EAP in 2021. 

"The second tranche of R84 631 000 million was made available in 2021. The Cuban government has been repaying the loan since December 2021," the response stated.

"The total loan to Cuba since 2018 is R147 631 000," Monyela said.

"Funds under the EAP could also only be used to procure goods in the South African market, which is beneficial to the South African economy."

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