African Development Bank approves plan for South Africa

The African Development Bank (ADB) plans to provide South Africa with more than $1.5 billion by 2028 to improve economic governance and stimulate private management, as reported by Prensa Latina, a partner of TV BRICS.

The five-year strategy approved by the group's board of Governors is aimed at supporting the efforts of the South African Government to solve structural problems, promote industrialization and establish a faster and more inclusive growth trajectory in order to reduce poverty in the long term.

According to the source, the estimated volume of the operating program for 2023-2028 is about 1.54 billion US dollars.

The expected results include a reduction in the budget deficit from 4.2 per cent of gross domestic product (GDP) in 2022-2023 to 3 per cent in 2027-2028.

In addition, private electricity production should increase from 100 megawatts in 2023 to more than 1 gigawatt in 2028, and 700 new small and medium-sized enterprises (SMEs) should have access to financing by 2028, the analysis says.

As part of the second priority area – private sector development – the African Development Bank intends to expand access to high-quality infrastructure, increase labor productivity and strengthen competition in order to promote growth and job creation.

Actions will focus on areas such as energy, transport, water supply and sanitation, as improving such infrastructure will help reduce the cost of doing business, increase productivity and strengthen the competitiveness of South Africa, the bank said.

According to the forecast, the bank's actions in the transport sector should help increase the share of the rail freight market from 26.8 per cent in 2023 to 28 per cent in 2028 and complete the construction of 38 kilometers of tunnels over a five-year period.

Until June 2023, the active portfolio of the African Development Bank group in South Africa consisted of 23 projects, the volume of financing of which amounted to 7 billion US dollars.

Photo: Prensa Latina