S. Africa, AIIB sign 500-mln-USD loan to improve urban services

What the report says

South Africa has signed a 500-million-U.S.-dollar sovereign-backed loan agreement with the Asian Infrastructure Investment Bank to support urban service reforms, according to a joint statement cited by The Independent Uganda from Xinhua. The deal, announced in Johannesburg, is AIIB’s first investment in South Africa and will back the South Africa Metro Trading Services Program.

The program is designed to improve the financial sustainability, accountability and day-to-day performance of municipal services, including water supply and sanitation, electricity, and solid waste management. It also aims to support a wider shift toward low-carbon, climate-resilient urban development. The article says the financing is co-funded with the World Bank and forms part of a broader 3-billion-dollar government-led initiative.

South Africa’s metropolitan municipalities, which are home to about 22 million people and generate much of the country’s economic output, are under pressure from aging infrastructure, urban growth and climate-related risks. National Treasury director-general Duncan Pieterse said the financing strengthens the government’s support package for metro trading services, while AIIB’s Rajat Misra described the agreement as the start of a partnership focused on more resilient and better-managed cities.

The report says the program is expected to run through 2031, with targets that include improved municipal performance and lower losses in water and electricity systems.