South Africa secures $8 billion from Afreximbank – here’s what it will be used for

Minister of Trade Industry and Competition, Parks Tau, left, President Cyril Ramaphosa, and Afreximbank president George Elombi at the signing ceremony. Picture: X/ the_dtic African Export-Import Bank (Afreximbank), the continent’s biggest trade bank, has committed an $8 billion (about R128 billion) financing package for new member South Africa to support the country’s industrial development goals. South Africa has formally joined Afreximbank, with the accession signing ceremony taking place in Johannesburg on Wednesday, attended by President Cyril Ramaphosa, Afreximbank president George Elombi and Minister of Trade, Industry and Competition Parks Tau, among others.

Elombi said Afreximbank will launch major financial interventions, including a new $8 billion country programme designed to deepen the South African economy. This money is expected to back projects in sectors like mining, automotive and manufacturing. “I am therefore pleased that together with the DTIC, under the leadership of Tau, we have put together what we consider an important package of $8 billion for South Africa.” he said.

“In particular, we will prioritise mineral processing, the expansion of automotive manufacturing and the expansion of industrial parks and specialised zones. The country programme is aligned with South Africa’s national development plan 2030 and national industrial and trade priorities, and targets key strategic areas.” Elombi also announced that it had set aside an additional $3 billion for inclusive growth by financing small and medium-sized businesses, township and black-owned enterprises, and projects that expand access to trade and economic opportunities. “We intend to invest heavily in the local processing of natural resources, thereby helping retain value in our economies, create jobs and generate wealth for our people,” said Elombi.

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South Africa was not able to join Afreximbank when it was established in 1993, but the cabinet approved a plan to move to a Class A shareholding in the bank last year November. Class A shareholders are African governments and central banks who set policy and strategy, Class B are African financial institutions that partner in financing and delivery and Class C are private and non-African investors who provide capital without sovereign influence.

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