South Africa says its budget can't cover for the deep US cuts in foreign aid

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South Africa's finance minister says the country doesn’t have the funds to cover the over $430 million shortfall caused by the Trump administration’s cuts in foreign aid

ByMICHELLE GUMEDE Associated Press

JOHANNESBURG -- JOHANNESBURG (AP) — South Africa doesn't have the funds to cover the over $430 million shortfall caused by the Trump administration's cuts in foreign aid, the country's finance minister said Wednesday.

Finance Minister Enoch Godongwana spoke to Parliament while presenting an updated budget — one without the value-added tax increases that had sparked public outcry and fierce disagreement among parties in the ruling coalition.

Without that tax revenue, he said, South Africa doesn't have enough money to make up for the cuts that have threatened the vast network of support for one of the world's largest HIV-positive populations.

The country runs the largest treatment network in the world.

The finance minister spoke shortly before President Cyril Ramaphosa’s much-anticipated meeting with U.S. President Donald Trump at the White House.

Earlier this year, the dismantling of USAID by the Trump administration saw around $436 million in annual funding for HIV treatment and prevention in South Africa evaporate, putting the program and thousands of health care jobs on the line.

Godongwana said the updated budget prioritizes financial resources to support what is currently feasible, and defers other programs until “our resources allow.”

More pain might be coming, he warned.

“The spending pressures that may require funding later this year include, among others, the withdrawal of the presidential emergency plan for AIDS relief called PEPFAR funding, particularly which was through the USA,” he said.

“We’ve not made provision for the allocation for that now."

Globally, PEPFAR is credited with saving at least 26 million lives since it began in 2003, according to the U.N. AIDS agency.

South Africa's previous budget presentation allocated 28.9 billion rand ($1.6 billion) for health. The current one allocates a significantly lower 20.7 billion rand ($1.1 billion) instead. The money is earmarked to protect around 4,700 health positions, hire 800 doctors who have finished their community service and address shortages in medical supplies, services, and accruals.