APA-Pretoria (South Africa) South Africa’s has signed multimillion-dollar loan deals with the African Development Bank (AfDB), World Bank, Germany’s state-owned development and investment bank, Kreditanstalt für Wiederaufbau (KfW) to support the country’s “just energy transition” programme, the country’s finance ministry has announced.
The ministry said in a statement on Wednesday that the concessional financing were a US$300 million credit facility from the AfDB, a US$1 billion loan from the World Bank and a €500 million loan from KfW.
“The loans provided by KfW and the AfDB follow their partnership with the World Bank on the second Development Policy Operation (DPO) to support South Africa’s commitment to the just energy transition for a low-carbon and resilient economy,” the ministry said.
These were sovereign loans provided directly to the government for general budget expenditure purposes, the office added.
These financing facilities from the three development institutions were in line with the ministry’s funding strategy to diversify its funding mix for international borrowing, it said.
This would enable it to access concessional financing instruments offered by the development partners to support government’s key reforms under climate change and the electricity sector, the ministry said.
“These facilities also enable the ministry to raise funding at very affordable rates which help to reduce the government public debt,” the office said.
The ministry said the agreements signified and reinforced the excellent collaboration among Germany, the World Bank, AfDB and “our government that has ensured the successful conclusion of the loans.”
NM/jn/APA