Bridging the Gap or Widening the Divide? A Critical Review of South Africa's Pandemic Financial Response

Abstract

This paper investigates the COVID-19 Loan Guarantee Scheme in South Africa, with a particular emphasis on its design, effectiveness, inclusivity, and enduring economic ramifications. By amalgamating data sourced from a variety of avenues, including interviews and surveys conducted among financial institutions, policymakers, and business beneficiaries, as well as statistical reports from International Monetary Fund (IMF), World Bank, and Stats South Africa, this study exposes clear patterns, underscores gaps, and provides a detailed dissection of the scheme's implementation and its subsequent economic impacts. The research findings illuminate the victories and potential disparities within the scheme, offering valuable insights for stakeholders ranging from policymakers and financial institutions to the beneficiaries of the scheme. Whilst the scheme has been pivotal in providing crucial support during an extraordinarily challenging time, there is a clear scope for enhancement to ensure broader accessibility and more equitable distribution of benefits. The paper concludes by highlighting the necessity for continual research in this ever-evolving economic climate, given the long-term implications of the pandemic, and pinpoints potential areas for future investigation. This research serves as a cornerstone for further investigation and an instrumental tool for stakeholders navigating the economic challenges catalysed by the pandemic.