Treasury Agrees To 1.5 Billion Loan

The South African government and the World Bank have signed a US1.5 billion Development Policy Loan Agreement that will assist in unlocking key infrastructure bottlenecks, particularly in the energy and freight transport sectors.

In a statement on Monday, the National Treasury said the loan aimed to support critical structural reforms to enhance the efficiency, resilience, and sustainability of the countrys infrastructure services.

The loan support is anchored on three key pillars of structural reform: improving energy security, enhancing the efficiency and competitiveness of freight transport services, and supporting South Africas transition toward a low carbon economy.

These reforms are critical enablers of inclusive growth and job creation.

This partnership marks a significant step towards addressing South Africas pressing economic challenges of low growth and high unemployment.

The financing forms part of the governments broader efforts to implement structural reforms that strengthen public institutions, crowd in private investment, and improve service delivery across priority sectors of the economy, said National Treasury.

The financing terms of the loan are in line with National Treasurys financing strategy.

Specifically, the loan offers both favourable interest rates and flexible repayment terms, contributing to minimising increase in debt servicing costs.

The financing terms of the World Bank loan are as follows:

The National Treasury wishes to express its appreciation to the World Bank for its continued partnership and support in advancing South Africas development objectives. This agreement reinforces the strong and constructive collaboration between the World Bank and the government of South Africa. - SAnews.gov.za