- During her visit to South Africa to attend the G20 Development Ministerial Meeting, Development Minister Reem Alabali Radovan announced a KfW loan of 500 million euros which aims to facilitate further reforms to South Africa’s energy sector that will create a conducive environment for private investment.
- This includes the expansion of the necessary grids for solar and wind power.
- The loan is entirely made up of market funds, meaning no German taxpayer money is involved.
Development Minister Alabali Radovan said, “South Africa and Germany are already feeling the impacts of climate change. Climate change mitigation is something we can only achieve through global collaboration – and that is what our energy partnership with South Africa is about. This energy partnership also benefits the German economy. German businesses and developers are already investing in the expansion of solar power, and South African companies are drawing on German materials, machinery and expertise. As a result, our energy partnership with South Africa will pay off many times over.”
The loan intends, among other things, to promote the urgently needed expansion of South Africa’s power grid. Over 14,000 km of new transmission lines are due to be constructed by 2032. Grid expansion also opens up new business opportunities for German companies, such as German machinery and plant manufacturers. In addition, the expansion of the grid aims to stabilise South Africa’s energy supply. Frequent power cuts have previously represented a major investment barrier for companies. There are over 600 German companies based in South Africa which will therefore also benefit from the energy partnership.
Author: Bryan Groenendaal
