CAPE TOWN SECURES R2BN FOR WATER, PUBLIC TRANSPORT AND ELECTRICITY PROJECTS

The City of Cape Town has successfully secured €100 million (equivalent to R2 billion) in development finance to support infrastructure projects.

The funding will be provided by Agence Francaise de Developpement (AFD), the development bank of France. The majority of the funding, 49%, will be allocated to water and sanitation projects, emphasizing the City’s commitment to addressing these critical areas. Additionally, 24% of the funding will be directed towards urban mobility initiatives aimed at improving public transportation, while 17% will be dedicated to enhancing access to electricity.

The agreement between the City and AFD was formally signed on Wednesday, following the approval of the funding by the city council in April. In a statement, the City expressed that the loan was secured at a more favorable interest rate compared to market rates, indicating the advantageous terms of the agreement.

AFD’s primary objective with this funding is to support investments that tackle socio-spatial inequalities and enhance the City’s resilience to climate change events, as stated in the City’s statement.

The City of Cape Town has enjoyed a longstanding partnership with AFD, with the first loan being issued in 2013. AFD has been a supportive force in various areas such as municipal infrastructure, biodiversity, and water security. Audrey Rojkoff, AFD Southern Africa regional director and country director for South Africa, highlighted that besides providing financial assistance through loans and grants, AFD has also offered technical expertise in planning major infrastructure projects.

Mayor Geordin Hill-Lewis emphasized that the City of Cape Town has a significant infrastructure investment portfolio of R120 billion over the next 10 years. The overarching goal is to position the City for sustainable economic growth, job creation, and overall development, aligning with their long-term vision of becoming a city of hope for all. This vision necessitates laying the groundwork now, focusing on water and energy security, improved sanitation, a cleaner environment, enhanced urban mobility, and increased resilience to climate change, as highlighted by Mayor Hill-Lewis.