The New Development Bank’s (NDB) annual conference in Cape Town this weekend should reassure us that there are global-scale development-funding institutions that comprehend the challenges that developing nations face in a rapidly changing and volatile global context, Cape {town} Etc reports.
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Developing countries, particularly those in Africa, are struggling to repay debt in an environment of high interest rates, and their commodity-extraction-focused economies are suffering as global demand falls.
The rapidly rising costs of meeting the global energy and climate transition, combined with rising geopolitical tensions, such as in the Middle East, have caused traditional multilateral infrastructure and development funding sources and aid to dry up, or at the very least, become increasingly expensive and difficult to obtain.
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In this environment, the NDB, whose members include Brazil, Russia, India, China, South Africa, Uruguay, Iran, Ethiopia, Egypt, and the United Arab Emirates, plays an increasingly crucial role in funding infrastructure in emerging nations. On Friday, for example, the Bank signed its 14th agreement in South Africa, granting Transnet an R5 billion loan to improve its freight rail operations.
South Africa, like most other developing countries, lacks the urgent finances (in the billions of rands) required to repair the railway network. Repairing it will enable mining and industrial enterprises to export more, resulting in increased job and economic growth potential for the country.
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Picture: Rohan Reddy / Unsplash
