The new South African ‘mega city’ worth R30 billion

The company Citigroup Inc. has partnered up South Africa’s Gauteng provincial administration to fund almost R1.4 billion of investment in an all new mega-city project and airport south of Johannesburg.

Citi South Africa head Peter Taylor said that the company through its South African unit, will make a seven-year loan facility available to a special purpose vehicle that will invest directly in infrastructure for the Mega River City on the banks of the Vaal river.

Taylor revealed that development could attract much as R30 billion in additional investment. During an interview he also mentioned that the new Vaal river city project will take the form of a public-private-partnership. “It will constitute a mixed-use metropolitan city development, an international airport, along with logistics, manufacturing and agricultural hubs.” – he added.

South Africa’s richest province Gauteng, has identified five corridors or sites where it wants to boost economic development and create jobs, with the new city the first of the envisioned projects.

It will consist of at least 1,200 hectares of land, and it will be joined together with an industrial hub where steel-maker ArcelorMittal SA and petrochemical giant Sasol Ltd. have processing facilities.

This Vaal River City project was first spoken about in 2015, with a great estimated development cost of between R7 billion and R11 billion. During that time, the mixed-use development was regarded as “South Africa’s first post-apartheid city” and it was planned to house 400,000 square metres of commercial office space; 60,000 square metres of retail and leisure component; 20 hectares of park areas – including a bird sanctuary; and 5,000 residential units.

Though updates on the project have not been much, work has been done on infrastructure around the site, including the construction of a major interchange, called the Vaal River City Interchange, in 2022.

President Cyril Ramaphosa in Sedibeng in August 2022 while addressing an imbizo, said the project was part of a special economic zone in the region which would support new industries.

He added that the special economic zone will support a skilled workforce and will enable producers of goods and services to connect suppliers to markets and support new local industries.

Main Image: Bloomberg