The City of Cape Town has secured an additional R3.5 billion in financing to support its plans for a South African record infrastructure investment over three years.
Mayor Geordin Hill-Lewis led the signing ceremony with Nedbank today, 24 June, after council approved the financing on 12 June.
Also read: Cape Town plans to outspend Gauteng metros in infrastructure
Cape Town intends to spend R39.5 billion on infrastructure from July 2024 to June 2027, as approved in its ‘Building For Jobs’ Budget.
This is South Africa’s largest three-year infrastructure investment made by a metropolitan municipality.
Cape Town accounted for 60% of the R100 billion in total government infrastructure projects announced nationally in 2023, according to Nedbank’s updated Capital Expenditure Project Listing for 2023, which was published in February 2024.
‘We are pleased to secure further finance towards our ambitious infrastructure investment agenda, which we estimate will create 130 000 construction-related jobs alone over three years. Lower-income households will also directly benefit from 75% – or R9bn – of Cape Town’s R12bn infrastructure spend in 2024/25.’
‘This pro-poor infrastructure spend in 2024/25 is bigger than the entire infrastructure budget of any other metro. Cape Town will soon be SA’s most populous city, and we are preparing for this by targeting our fastest-growing, and poorest areas, with infrastructure projects that will, over time, unstitch the unjust legacy of our country’s past,’ said Mayor Hill-Lewis.
The City’s 10-year pipeline is valued at approximately R120 billion. The majority of the projects are classified as ‘Economic, Social, and Governance (ESG)’ and are related to the City’s overall Climate Change Strategy.
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In October 2023, the City issued a request for funding proposals (RFP) for the fiscal years 2023/24 and 2024/25, which was followed by extensive discussions with local and international lenders.
In addition to the Nedbank finance approval in June 2024, City Council approved $150 million in financing from the International Finance Corporation (IFC) and €100 million in development financing from the Agence Francaise de Developpement (AFD) in April 2023.
The City employs a blended finance model that includes funding from its own strong balance sheet, as well as financing from local and international markets.
During the fiscal year 2024/25, council will consider additional financing agreements to address the remaining funding needs for the City’s infrastructure plans.
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Also read:
Cape Town approves SA’s biggest pro-poor infrastructure investment
Picture: City of Cape Town
