Afreximbank announces R128 billion investment to boost South Africa's economy
President Cyril Ramaphosa greeting Afreximbank President Dr George Elombi after arriving at the Four Seasons Hotel The Westcliff in Johannesburg for the Signing Ceremony of the Instrument of Accession by South Africa to the Establishment Agreement of the African Export–Import Bank.
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The African Export-Import Bank (Afreximbank) has made an $8 billion (R128 billion) commitment aimed at revitalising South Africa's economy.
At a recent event with the Department of Trade, Industry and Competition (dtic), Afreximbank President Dr George Elombi highlighted that this substantial country package aligns with South Africa’s national development priorities and underscores the country's newly established full membership within the multilateral trade finance institution, according to Business Report.
"This country package is aligned with South Africa’s national development priorities and will target key areas,” Elombi stated, emphasising the bank’s commitment to enhancing local industrialisation and infrastructure.
A significant aspect of this investment will focus on value-added industrial activity, particularly in mineral beneficiation and the automotive manufacturing sector. Elombi expressed a strong desire to retain economic value within South Africa by promoting local processing of natural resources, ultimately creating jobs and fostering wealth generation.
Critical infrastructure development will also play a pivotal role in the funding strategy, with a keen emphasis on energy generation and transmission, Business Report reported.
"We are fighting for the industrial revolution so that our minerals can no longer leave our shores without value being added," Elombi said, reinforcing the necessity for a reliable power supply as a foundational element for the continent's industrial future.
Beyond national development, Afreximbank aims to facilitate South Africa's entry into regional and continental markets, directly supporting the implementation of the African Continental Free Trade Area (AfCFTA) and promoting access to Africa’s burgeoning single market.
To implement this expansive programme, Afreximbank plans to collaborate closely with several key South African institutions, including the Industrial Development Corporation (IDC), Development Bank of Southern Africa (DBSA), Public Investment Corporation (PIC), and various commercial banks. This partnership-oriented approach is expected to maximise the impact of the funding across multiple sectors.
In addition to the $8 billion allocation, Elombi announced an additional $3 billion inclusive financing programme crafted in partnership with the dtic and the National Transformation Fund.
This initiative is designed to support small and medium-sized enterprises, as well as marginalised and vulnerable sections of the South African economy.
“This $3 billion inclusive package is to support the resourceful, but marginalised and vulnerable servants of the South African economy,” he affirmed, recognising that access to appropriate financing is often critical to the survival of small firms.
Elombi pointed out that Afreximbank’s support for South Africa predates its full membership in the bank. Over recent years, the financial institution has made significant investments in various vital sectors, including the launch of a $1 billion South Africa–Africa Trade and Investment Promotion Programme in 2018 aimed at boosting trade and investment across the continent.
Furthermore, Afreximbank has engaged in a host of projects, including the $300 million Zimbabwe–South Africa water infrastructure project and contributing to the development phase of a $500 million titanium dioxide manufacturing facility in Richards Bay.
The bank currently has a robust pipeline of bankable projects in South Africa, encompassing energy, transport, healthcare, financial services, manufacturing, and mining, with project values exceeding $6 billion across various stages of development. Concluding his address, Elombi reiterated Afreximbank’s broader continental mission:
“We are here first and foremost as Africans… This renewed connection between South Africa and the Bank has the potential to transform not only South Africa but Africa as a whole.”
IOL Business