The African Development Bank (AfDB) has approved a R2.2bn line of credit facility for the Development Bank of Southern Africa [DBSA] earmarked for strategic projects in energy, infrastructure, and communications technology in Southern Africa.
The DBSA is a state-owned bank specialising in development loans. It is a pivotal agency in the government’s ambitious infrastructure drive which it hopes will reignite growth and help the country reduce the burden of poverty, unemployment and inequality.
In 2020, the DBSA signed a memorandum of agreement with the Treasury and the department of public works & infrastructure, establishing the long-awaited infrastructure fund. To be spearheaded by the DBSA, the fund is intended to help drive the government’s build programme through blended finance projects that tap into funding from local and international financing institutions in the private and public sectors as well as the government.
In a statement on Tuesday, the AfDB a multilateral development finance institution based in Abidjan, Ivory Coast, said its facility to the DBSA will help the bank augment internally generated funds as well as loans from other institutions and commercial lenders. DBSA is seeking to raise $1bn [about R19bn] in funds over the next three years.
“As it seeks to expand its portfolio ... it will focus on clean and renewable energy, infrastructure, ICT, social as well as women-owned projects in the Sadc region. The loan [R2.2bn] was approved on 15 December 2022,” said the AfDB.
It said DBSA’s strategic priorities also align with those of the SA government, including its national development plan and its new growth path , in addition to the UN’s Sustainable Development Goals and Nationally Determined Contributions [NDCs] which are at the heart of the Paris Agreement.
Under the Paris Agreement on climate change signed in 2016 all parties are required to deposit NDCs every five years, highlighting efforts to reduce emissions.
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