An estimated 500,000 people in South Africa are infected with HIV/AIDS each year and close to 1,000 die of related ailments every day.

Figures from the department of health said the national strategic plan (NSP), which aims to give 80 percent of HIV-positive people access to antiretroviral therapy by 2011, would cost about 6 billion rand to implement in 2008, rising to 11 billion rand in 2011.

"If the NSP target of 80 percent of HIV-positive people receiving antiretroviral therapy (ART) was achieved, this would exceed 20 percent of the health budget," said the report, posted on the Web site of U.N. agency UNAIDS.

"This poses a challenge for both the affordability and sustainability of the NSP," added the report, which was approved by South Africa's cabinet this week.

President Thabo Mbeki's government has been criticised for not doing enough to halt the spread of the disease despite the heavy economic and human toll.

But in its strategic plan which runs from 2007 to 2011, the government has significantly ramped up spending and increased access to life-saving antiretroviral drugs.

The report said there has been an encouraging trend showing lower HIV prevalence among young pregnant women in South Africa aged below 20 years and those aged between 20 and 24.

"This could be the beginning of the long-awaited downward trend on prevalence among pregnant youth in South Africa," it said.

But exorbitant prices for antiretroviral drugs and a dire shortage of skilled medical personnel remained major challenges.

"It is estimated that at current prices the provision of antiretroviral therapy will account for about 40 percent of the total cost of the national strategic plan," said the report.

"This much-needed service will soon be unaffordable at current drug prices."

During 2007 only 42 percent of 889,000 people requiring ARV drugs were able to access them, figures show.