South Africa has secured a R26 billion ($1.5 billion) loan from the World Bank to support structural reforms aimed at addressing the nation’s energy and transport challenges. The loan is part of the government’s efforts to modernise state-owned enterprises and open key sectors to competition, with the goal of boosting economic growth and reducing the high unemployment rate, which currently stands at nearly 33%.
The World Bank’s support will focus on enhancing energy security and increasing freight transport capacity. Specifically, the loan will provide funds for Eskom to bolster the electricity grid in preparation for renewable energy generation and for Transnet to expand rail and port infrastructure. These initiatives are expected to support the government’s plans to add 3,500 megawatts of renewable energy capacity by March 2027 and to enable the entry of private operators into the transport sector.
Finance Minister Enoch Godongwana expressed optimism about the partnership, stating that it will assist South Africa in moving forward with greater speed on the reforms vital to transforming the country’s infrastructure landscape.
