South Africa

South Africa is one of the leading economic powers in Africa. Yet the country continues to be marked by high levels of socioeconomic inequalities. AFD’s support has historically focused on the upliftment of disadvantaged populations. Since 2008, it has also been supporting infrastructure development and is scaling up its climate action.
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Cape Town minibus station (South Africa)
AFD and South Africa: A sustainable and innovative partnership
Cape Town minibus station (South Africa)

Toward a sustainable and balanced urban and territorial development

South Africa Meeting with an AFHCO housing tenant

Toward a sustainable and balanced urban and territorial development

AFD supports South Africa’ sustainable urban development policy, which aims to make cities and human settlements inclusive, safe, resilient and sustainable. AFD provides direct loans to metropolitan municipalities for infrastructure projects and to fund capital budgets to support development policies. It also uses financial intermediaries to support small and medium sized municipalities in their basic infrastructure investments.

South Africa’s largest cities have been tapping into AFD’s expertise in their effort to promote more carbon-efficient urban development and greater resilience to climate change. Through a technical cooperation agreement, AFD has facilitated peer-to-peer dialogue on climate resilience and adaptation between staff of the City of Paris and City of Johannesburg. In Cape Town, AFD has funded a study on risks assessment and adaptation solutions through the Cities and Climate Change in Africa programme, which aims at accelerating the implementation of infrastructure projects, while at the same time maximizing their climate co-benefits.

Speed up the energy transition

bio2watt, énergie, biogaz, vaches, Afrique du Sud

Speed up the energy transition

South Africa has shown great commitment to reducing carbon emissions by decreasing its dependence on coal and increasing energy generation from renewable sources by 2030. If these efforts are sustained, carbon emissions should stabilise between 2025 and 2030 and decline thereafter.

AFD is a long-term partner of ESKOM, South Africa’s national electricity provider, and has been instrumental in helping the country diversify its energy mix. In the Western Cape, AFD has co-financed the construction of a 100 MW wind farm, which represents ESKOM’s first foray into large scale wind energy. Going forward, AFD has recently issued a multi-tranche facility to finance ESKOM’s transmission development plan and ensure the integration of the renewable energy resources.  

Through its green finance label Sunref, AFD has helped small and medium enterprises (SMEs) access finance through major South African banks to kick-start or scale up their efficiency and renewable energy projects.

SMEs also benefit from technical assistance in the form of knowledge transfers and expertise for energy use management through AFD’s partner the South African Energy Development Institute (SANEDI).

Creating opportunities for all and reducing social inequalities

Johannesburg, Afrique du Sud, ville, jeunes

Creating opportunities for all and reducing social inequalities

AFD regards vocational training and access to decent employment, especially for previously disadvantaged youth, as key to unlock the economic potential of the country. Currently, more than half of young people aged 15-24 are unemployed in South Africa. 

AFD works with government, universities public and private training institutions to improve access to employment by supporting higher education and vocational training programmes. AFD is currently exploring the possibility of providing student loans and student accommodation, which will contribute to increasing access to quality education for previously disadvantaged populations.

AFD also remains committed to improve access to housing for previously disadvantaged populations. To this end, AFD has developed key partnerships with private property developers such as the Affordable Housing Company (AFHCO) and state-owned financing institutions such as the National Housing Finance Corporation (NHFC) and the Gauteng Partnership Fund (GPF).

2,5
billion euros of commitments since 2004
40
projects financed since 2004
360
MW of renewable energy financed since 2004

With a population of about 54 million and an annual income of nearly US $ 12,390 per capita, South Africa is one of the largest economies in the African continent. With a GDP of over US$ 320 billion at the end of 2015, South Africa is the second economy of sub-Saharan Africa after Nigeria.

South Africa has a rich and varied mineral wealth, a well-developed financial sector, efficient legal and communication sectors and modern infrastructure.  Despite the formal eradication of apartheid in the early 1990s and a much-celebrated transition to democracy in 1994, South Africa remains a land of stark economic inequalities that break along racial lines. In addition, the country has been experience slow economic growth and high unemployment and governance issues facing state-owned companies  

South Africa is amongst the world's most carbon-intensive economies due to its heavy reliance on coal for electricity generation and an energy-intensive industrial and mining sector. However, the country has shown great commitment to reducing carbon emissions by decreasing its dependence on coal and increasing energy generation from renewable sources by 2030. If these efforts are sustained, carbon emissions should stabilise between 2025 and 2030 and decline thereafter.

AFD has been active in South Africa since 1994, offering innovative financing solutions and technical assistance to support the South African government in its development policy. AFD works with government partners and local authorities to promote a low-carbon economy and reduce economic, social and territorial inequalities.

Around half of AFD’s projects are co-financed with partners – not just other development banks – but also research institutions, universities, NGOs, foundations, think tanks, development institutions, United Nations agencies and local and regional authorities. Co-financing helps to multiply the impact of our projects and attract other partners, therefore allowing us to be more ambitious.

The Johannesburg agency also covers AFD's activities in Angola, Botswana, Mozambique, Namibia, Zambia and Zimbabwe.

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In South Africa, from cow manure to green energy

In South Africa, a biogas plant uses natural resources such as cow manure and food waste to produce 100% ‘green’ electricity.
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Research document

Defining Social Cohesion

Promoting social cohesion is one of the most difficult, yet one of the most important, challenges facing South Africa. However, while there is a widespread agreement that social cohesion influences ...
Jun 2018
Research document

From definition to measurement: Constructing a social cohesion index for South Africa

Social cohesion has increasingly become a subject of interest for international organisations, governments, policy-makers and other practitioners. Whilst social cohesion is not a new concept, finding its origins in the ...
Jun 2018
Research document

The Gap Between Rich and Poor: South African Society’s Biggest Divide Depends on Where You Think You Fit In

In this paper, we consider social cohesion primarily in terms of its absence – “the nature and extent of social and economic divisions within society” (Easterly et al., 2006: 105). We use data ...
Jun 2018
Research document

Social Cohesion and inequality in South Africa

We examine recent trends in social cohesion and inequality, and the relationship between the two in South Africa using date from the South African Reconciliation Barometer Surveys. Given that the ...
Jan 2018
Filmed evaluation

Soweto Water Project | 2005 - 2010 | A filmed evaluation

The Operation "Gcin'amanzi" (Zulu for "water conservation") in Soweto is one of the country's most ambitious water-related projects. In post-apartheid South Africa the project was essential. Since the fall of ...
Jun 2010
Institutional document

Southern Africa: Biodiversity

Southern Africa has a rich natural heritage of global significance to the world’s climate and biological diversity. Unfortunately, the capacity of nature to maintain this biological wealth is rapidly ...
Sep 2018
Institutional document

Southern Africa: Social inclusion

Access to education, healthcare, decent housing and employment are fundamental to human dignity, and are key to achieve poverty eradication. In Southern Africa, although poverty rates fell by almost half ...
Sep 2018
Institutional document

Southern Africa: Infrastructure

Southern Africa has some of the most developed infrastructure in the continent. However, the region still faces numerous challenges, such as insufficient energy supply, highly priced and unpredictable transport, lack ...
Sep 2018
Institutional document

Southern Africa: Energy transition

Southern Africa has access to a wealth of primary renewable energy sources, with enough geothermal, hydro, wind and solar resources to provide gigawatts of power. However, the adoption of low-carbon ...
Sep 2018
Video

South Africa: from cow manure to green energy

In South Africa, a brand-new action has come into being: cow manure is being used. Sean Thomas, a South African entrepreneur, has set up a plant that produces biogas energy. ...
Nov 2017
Video

Soweto Water Project | 2005 - 2010 | A filmed evaluation

The Operation "Gcin'amanzi" (Zulu for "water conservation") in Soweto is one of the country's most ambitious water-related projects. In post-apartheid South Africa the project was essential. Since the fall of ...
Jun 2010