About one in nine South Africans is HIV positive, but the South African government had refused to provide AIDS medicine to its people through the public health system. That stance made it the target of intense criticism at home and abroad.
AIDS activists praised the decision, saying it finally gave hope to the 4.7 million South Africans suffering from the disease — more people than in any other country in the world.
"We think it is the best news in many years," said Zackie Achmat, head of the Treatment Action Campaign. Achmat is HIV-positive.
The decision was made at a special Cabinet session during which government ministers reviewed a report on options for treating South Africa's HIV-positive population.
The long-awaited report was finally made public Friday, although sections had been leaked earlier.
The report argued South Africa should adopt the World Health Organization guidelines as the basis for treating AIDS patients.
The Cabinet has given the health ministry until the end of September to present a plan for distributing of AIDS drugs.
"We will wait to see the actual operational plan before celebrating, but for all of us living with HIV in South Africa and our families this is the first sign of hope," Achmat said. "We are ready to work to make the plan a success.
The Cabinet said in a statement that the government was moving forward.
"Government shares the impatience of many South Africans on the need to strengthen the nation's armory in the fight against AIDS," the statement said. "Cabinet will therefore ensure that the remaining challenges are addressed with urgency and that the final product guarantees a program that is effective and sustainable."
According to the recommendations of the report under government review, those in an advanced stage of disease would have access to AIDS drugs.
The report says developments on the pricing of drugs and a larger government budget now enables officials to consider the provision of AIDS drugs in the public health care system.
"Policy and funding commitments made in the last two years leave South Africa well placed to offer a comprehensive package of prevention and care in the health sector," the report said.