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Germany commits USD 100 million for development cooperation with South Africa

2 July 2018

As part of the development cooperation between South Africa and Germany, German Development Bank KfW and Eskom signed a development loan worth over ZAR 1.35 billion. The investment will benefit the South African energy sector and promote the integration of renewable energy power generation into the grid.  
On behalf of the German Government represented by the German Federal Ministry for Economic Cooperation and Development (BMZ), KfW has committed a financial cooperation development loan to state-owned public utility Eskom, totalling USD 100 million (ZAR 1.35 billion). The funding will make a substantial contribution towards modernising and strengthening the transmission grid in South Africa, and to ultimately promote renewable energy power generation in the country.  
The loan will be used to co-finance three transmission projects that involve the upgrading of existing infrastructure and the building of new lines. Eskom intends to implement the selected projects to significantly improve security of supply, and to reduce transmission losses.

Furthermore, the new infrastructure will allow for the integration of power from solar and wind plants into the national grid. The network integration of renewable energy sources and the improved grid efficiency will directly contribute towards reducing CO2 emissions. This will support South Africa in reaching its ambitious climate goals.
The ceremonial signing of the loan agreement took place on the 29th of June with participation from Director General of the South African Department of Public Enterprises, Donald Nkadimeng, Deputy German Ambassador Mr. Klaus Streicher, KfW Director of Southern Africa and Regional Funds Dr. Thomas Duve, Eskom Acting CFO Mr. Calib Cassim and Eskom Group CEO Mr. Phakamani Hadebe.
On the occasion of the signing, Deputy German Ambassador Klaus Streicher stressed the important role of the energy sector and the value of the German-South African partnership:  
“A reliable energy supply is the backbone of growth, job creation and innovation. Clean energy is a prerequisite for health and quality of life. When we work together on the basis of trust, leveraging each other’s strengths, we make the greatest strides towards a greener and more inclusive society.”
Germany remains committed to its vibrant strategic partnership with South Africa that encompasses the political, economic, cultural and social spheres. The South African National Development Plan (NDP) serves as the essential guideline for South African-German development cooperation. All projects are implemented based on intergovernmental agreements between South Africa and Germany. The two countries have identified four priority areas for their cooperation:  
- Energy and climate ("Green Economy") 
- Good governance and public administration; 
- Technical and vocational education 
- HIV prevention  

Germany committed more than ZAR 29.12 billion (EUR 1.98 billion) in bilateral Official Development Assistance (ODA) in the time period from 1995 to 2016. The assistance is designed to address South Africa’s triple challenge of overcoming poverty, unemployment and inequality by empowering people, improving institutional capabilities, building skills and stimulating inclusive economic growth. 
German Embassy Pretoria




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