In The Spotlight
![The AfDB board complemented Transnet for progress made in rolling out its compliance and governance improvement programme. (Image source: AfDB) Some heavy logistics equipment branded with Transnet logo.](/images/2024/july/transnet-afdb-recovery-plan-south-africa.webp#joomlaImage://local-images/2024/july/transnet-afdb-recovery-plan-south-africa.webp?width=787&height=399)
The AfDB board complemented Transnet for progress made in rolling out its compliance and governance improvement programme. (Image source: AfDB)
The African Development Bank (AfDB) has approved a US$1bn corporate loan to Transnet, a major freight transport and logistics company in South Africa
The company has faced significant operational challenges over the last few years and has been an ever-present stay in media headlines due to underinvestment in infrastructure and equipment, theft and vandalism, and external shocks (such as floods) that have affected critical rail and port businesses.
It has now committed to addressing these past challenges, fostering integrity and enhancing efficiency. This is being pursued, primarily, through its recovery plan that was launched in October 2023 that seeks to rehabilitate infrastructure and accelerate the relaunch of operations over 18 months. Restoring operational performance and freight volumes to meet customer demands has been recognised as a priority.
Vital AfDB support
In order to assist with these recovery and growth plans, AfDB has now committed to a US$1bn corporate loan to Transnet. The 25-year loan – fully guaranteed by the Government of South Africa – will facilitate the first phase of the company’s US$8.1bn five-year capital investment plan.
“Transnet, the custodian of South Africa's critical transport and logistics infrastructure, plays an indispensable role in the economy of the country, ensuring a competitive freight system and serving as a gateway to the SADC region,” commented African Development Bank’s vice president for private sector, infrastructure and industrialisation, Solomon Quaynor. “Our partnership will enable Transnet to execute a comprehensive recovery plan, addressing operational inefficiencies, particularly in rail and port sectors.
“It is aligned with South Africa's strategic 'Roadmap for Freight Logistics System,' and overseen by the National Logistics Crisis Committee, chaired at the Presidency level. This initiative signifies our commitment to enhancing national logistics capabilities and driving sustainable economic growth.”
Michelle Phillips, group chief executive of Transnet, added, “We appreciate the support demonstrated by the African Development Bank, the loan extended by the bank will make a significant contribution to Transnet’s capital investment plan to stabilise and improve the rail network and to contribute to the broader South African economy. The accompanying grant funding to the loan will also greatly assist Transnet with to its energy efficiency efforts and with Infrastructure Project Preparation initiatives.”
![d.light has a proven track record in the use of securitised finance to support its solar-powered household products in sub-Saharan Africa. (Image source: d.light) An African engineer working on a vehicle engine by light at night.](/images/2024/july/D%20light%20solar%20power%20solutions%20africa.webp#joomlaImage://local-images/2024/july/D light solar power solutions africa.webp?width=787&height=399)
d.light has a proven track record in the use of securitised finance to support its solar-powered household products in sub-Saharan Africa. (Image source: d.light)
d.light, a global provider of transformational household products and affordable finance for low-income households, has closed a new securitisation facility to scale-up its PayGo consumer finance offering to make solar-powered products available to low-income communities in select African countries
The new financing is being provided by African Frontier Capital, a social impact-focused asset management company, and will be used to purchase US$176mn of receivables in Uganda, Tanzania and Kenya. With this new agreement, the provider has now closed securitised financial with a total combined purchasing value of US$718mn since 2020.
According to the company, the multi-currency facility will enable access to reliable, renewable energy for an estimated six million people across the next three years. “This new facility is another landmark step in d.light’s mission to provide people with affordable energy that is also clean, safe and sustainable,” remarked d.light CEO Nedjip Tozun. “It lets us expand our reach so that millions of off-grid families across Kenya, Tanzania and Uganda can experience the benefits of solar energy.
“Facilities like this make possible our pioneering PayGo consumer financing model with which we are able to offer solar home systems and high efficiency appliances to the people that need them most in a way that is affordable and sustainable.
Solar solutions for Kenya, Uganda, Tanzania and Nigeria
“With this new facility, d.light has for the first time in its history receivables-based financing facilities in each of our PayGo markets - Kenya, Uganda, Tanzania, and Nigeria. These facilities allow d.light to remain consistently cash flow positive and remove the requirement for further external equity fundraising to fund our growth."
Eric De Moudt, AFC’s founder and CEO, added, “This milestone is a testament to how data-driven financial innovation can play an important role in bringing financial inclusion to the world’s most vulnerable communities, helping them to gain access to clean and modern energy and the ensuing social and economic benefits that come about as a result. We are grateful to d.light for its ongoing leadership in the off-grid solar sector and proud to partner with such a visionary company.”
Dietmar Siersdorfer, managing director of Siemens Energy Middle East & Africa, considers electrification, the need for natural gas, the focus on transmission and emerging digital solutions within Africa’s energy landscape
At the recently concluded Africa Energy Forum (aef) in Barcelona, Siersdorfer, opened a session exploring the continent’s energy landscape and how its resources are poised to take a central position in the global energy revolution.
In his address to the delegates, Siersdorfer’s excitement for his new role as leader of Siemens Energy in Africa was palpable, pointing out that the continent is the fastest growing energy market on the globe – forecast by the organisation to grow by 15% CAGR between 2023 and 2028 alone – and has a number of competitive advantages playing in its favour. The latter, Siersdorfer listed, including the abundant renewable resources available to African nations; a strategic geographical position that could enable it to become an exporter of electrons for neighbouring regions; the potential it holds for innovation (describing it as a “laboratory” where future technologies could be matured); and its accelerating energy demand (expected to surge by 60% between 2022 and 2030, according to the IEA). Moreover, the whole continent is responsible for a mere 1.4 giga tons of energy-related emissions per year, an astonishingly small contribution, even when compared to select single countries (China produces 10.8 giga tons per year).
To lay the groundwork for Africa to achieve its potential, Siersdorfer identified four points that he believed must be focused on: maintaining reliable power supply, making energy greener, embracing system complexity, and adopting digital solutions. To dig into these further, African Review spoke to the managing director at the conference in Barcelona.
Going green via gas
While Siersdorfer noted that the 1.5-degree threshold is probably out of our grasp now, he stressed we must still strive to limit global warming and ultimately achieve net zero. In this pursuit, the imperative of integrating green generation capacity within Africa (and the global) energy landscape is, in the modern day, well understood.
However, the managing director was quick to emphasise that with Africa responsible for such a minor proportion of global emissions, the need to minimise its environmental impact must be balanced against the dire need for providing reliable energy access to the vast population of African inhabitants who currently live without it.
For Siersdorfer, the way to steer this course is clear, and it resides in a resource categorised as a fossil fuel: natural gas. This definition, the managing director explained, has somewhat cooled global appetites of late, with some commentators suggesting a hard break from hydrocarbons is the path Africa should take. In the view of Siersdorfer, though, it is the right of less developed nations to exploit their natural resources in order to close the development gap – as many advanced countries have done before. As a reliable, plentiful, valuable and affordable energy source that has a far smaller climate footprint than its fossil fuel cousins, gas presents the perfect bridge in the transition to net zero, he surmised. Moreover, it is widely viewed as the frontrunner to hydrogen, with associated technology and infrastructure ready to adapt to a green hydrogen future should it be realised.
“Generally, Africa is embracing renewable technology but we should not underestimate that energy demand in Africa is huge (and growing),” commented Siersdorfer. “Many countries have gas available and it is therefore vital to take this resource into the equation when building sustainable energy systems. Currently, much of the continent is coal-dependent. About 70-80% of power generation in South Africa, for example, is provided by coal-fired power stations. If it was to switch immediately to gas, we predict the country would reduce CO2 emissions by 40%. Comprehensive utilisation of this resource would, therefore, massively limit emissions, form the foundation of energy systems that give people access to electricity, and build the base of industrial development.”
At this point, Siersdorfer retrieved an anecdote drawn from his extensive experience working within the Middle Eastern market. This region, despite being generally more developed than Africa, has not sought to jump straight to renewables but is, instead, choosing a path to net zero that is paved with gas-fired power stations. Perhaps the best demonstration of this policy can be seen in the US$1.5bn contract Siemens Energy has just signed in Saudi Arabia. This agreement will see the company supply key technologies for the forthcoming Taiba 2 and Qassim 2 combined-cycle power plants that will generate approximate 2GW of electricity each. Expected to be connected to the grid – in simple cycle mode – as early as 2026, they demonstrate the ability of such stations to provide rapid energy to meet growing demand while are also being a vital step in the country’s strategy to reach net zero by 2060.
This is a lesson Siersdorfer hopes African leaders will take on board as they continue to chart their own courses in the energy transition. “I would emphasise, here that it is no one size fits all of course – it is not all about renewables or gas. Country policymakers need to build transition maps that work for them, built on the resources available to them and that can be best used. This is one area Siemens Energy can help. We build country strategies and advise how to deliver energy systems of the future – specific to that environment – which encapsulate decarbonisation agendas.”
Grid modernisation
The emergence of renewables and the proliferation of energy sources will, almost certainly, lead to the growth of system complexity – a problem that proponents of a green future in Africa are striving to solve.
Indeed, grid infrastructure and the debate around transmission took centre stage at the conference in Barcelona, with delegates recognising that a traditional focus on power generation has left this aspect neglected and the need pressing. According to the IEA’s Financing Clean Energy in Africa, annual investment in grids here grew at only 5% between 2019 and 2022, with reliable and robust electricity grids remaining a missing piece of the puzzle. In the Sustainable Africa Scenario, grid investments must rise to US$50bn per year by 2030 ‘in order to finance the required expansion and modernisation of grids that the influx of renewables requires’.
“Fortunately, this is no longer a non-topic in Africa, although some ministers I speak to are still very much focused on generation,” Siersdorfer remarked. “The bottom line is: grids need more resilience in the future and they need to be more interconnected. They are the foundation of the new energy systems that need to be built for individual countries, especially for when they are looking to exchange electricity with their neighbours.”
Elsewhere, this message has been firmly understood, he explained, as countries such as Saudi Arabia are identifying the work they need to do and are now heavily investing. In doing so, they are sucking capacity from manufacturers of associated equipment and developers so that these services are becoming less available for use elsewhere.
“As a manufacturer, we are upgrading our capacities everywhere in the world as we foresee an enormous growth in the grid market across the globe,” said Siersdorfer. In Nigeria, this has translated into action with the company working with the Federal Government in support of the Presidential Power Initiative. A drive dedicated to upgrading the country’s electricity network, it is aimed at providing power to Nigerians by bringing an additional 25GW of electricity online and to upgrade and expand the national grid to connect and boost supply.
Dealing with data demand
This discussion around grid stability and reliable supply led Siersdorfer onto a topic that has dominated headlines in the recent past – the rise of the data centre market. Fuelled by an increase in connections for households and businesses alike, an increasingly urbanised and youthful population demanding access to the Internet through 3G, 4G and even 5G, and the surge of smartphone adoption, mobile data consumption in Africa is expected to increase by 40% each year until 2025, according to AIIM. To meet the exponential increase in data traffic, the continent’s digital infrastructure must be developed and an increase in capacity to 1,200MW by 2030 is required. To realise this and support the emerging digital economy, a surge in investment has been forthcoming, reaching US$2bn in 2020 and expected to reach US$5bn by 2026.
“Data centre operators need facilities up and running quickly, and they have the money to spend to do so,” Siersdorfer explained. “But, they need reliable power and a stable grid. Why, then, would they look to do develop a project in Togo or Tanzania – which could take seven years – when it could take three elsewhere and be more viable with greater energy security?
“The data centre market is a huge opportunity. If African nations are able to build resilient grids, backed by a mix of renewables and gas, then they could attract the likes of Amazon and Microsoft. If countries are willing to put in the work and invest in their grids, they can attract even greater attention from hyperscalers who can come and build business here.”
From Siemens Energy’s perspective, Siersdorfer was quick to add that the company has the equipment and expertise to provide everything a data centre requires throughout its life cycle – from integration solutions to bring power from the transmission grid to reliable and sustainable emergency backup power when energy is not available.
A clean slate for innovation
In building the energy infrastructure of the future, the managing director was also keen to point out that innovative, digital solutions could play a leading role in dealing with the complexity of their potential makeups.
As the company has made clear, optimising performance and maximising efficiency in today’s energy landscape is critical, and harnessing the power of digitalisation is crucial to do so. Data-driven control systems, advanced software and integration of artificial intelligence has the potential to enhance grid management and precision in predictability to improve load forecasting and more effectively balance supply and demand. While there is some apprehension around the emergence of AI within the energy sphere, none stems from Siersdorfer. “There is no need to fear it; there is a need to embrace it. AI it is still in its infancy but is starting to be used in many of our systems, I believe it will have a huge role in the future. More regulation around it is certainly required but when I look at our domain and the enormous potential it offers; it is a breath-taking opportunity.”
And this opportunity is not one exclusive of Africa. “The continent is in an interesting position where it can almost start afresh, right from the beginning. I see it is a laboratory for how we can conduct the energy transition from scattered systems into new, modern ones. AI will be at the forefront of this. In my mind, it is a unique and compelling chance for the African market and it will definitely be utilised in solutions that companies like Siemens Energy are providing.”
Certainly, Siemens Energy has positioned itself at the front of this technological development wave, and Siersdorfer pointed to the four innovation centres and huge R&D programme dedicated to interacting with customers, governments and beyond, and designing new solutions around their needs. This, the managing director concluded, is integral to the company’s core mission. “People ask me what our mission is. My answer is the same here as it is of any region: to energise society. I think this is a noble goal.”
This article was sponsored by Siemens Energy.
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In the final webinar of its African Review-hosted 2023 campaign, Convergent Group explored its modern, eco-friendly concrete solutions for African projects
Such solutions – delivered to cut maintenance costs by eliminating hazardous silicate products – were showcased by company experts in the form of Jean-Claude Biard, SEO of Convergent Group SA; Mputu Schmidt, former CEO of Convergent Group SA and founder of Bondeko MB (exclusive distributor of Convergent Group in Africa); Carlos Garcia, technical and sales for ADI Group (Spanish distributor for Convergent Group); and Amritpal Singh Sura, external consultant for flooring treatments, former distributor of Convergent products in the Middle East.
“A number of projects we were doing in the Middle East required protection,” remarked Sura. “Longevity of protection requires a system which basically impregnates and becomes a densified surface as opposed to something which is topical and lifts off due to moisture migration. I found that being exposed to Convergent, it was important to stay focused on those systems in the Middle East. Jean-Claude, Mputu and I met several times in Dubai and there was emphasis on providing systems which were affordable and still ending up having a robust, lasting longevity of product. So you are not spending money all the time in order to maintain the finishes which you have already paid for.”
Over the course of the session, the participants guided the audience through the potential of cutting-edge lithium silicate technology for enhancing the protection of concrete surfaces, maximising cost-effectiveness and meeting sustainability targets.
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In a comprehensive webinar hosted by African Review, a panel of professionals associated with Convergent Group explored new generation lithium silicate technology and why it is emerging as the optimum solution for concrete floor protection.
Robert Daniels, editor of African Review, was joined by Jean-Claude Biard, CEO of Convergent Group; Mputu Schmidt, former CEO of Convergent and founder of Bondeko MB, an exclusive distributor of Convergent; Hicham Sofyani, president of Texol; Carlos Garcia, technical and sales for ADI Group; and Marc Puig, commercial manager of Comace Import.
Each providing a unique angle, the panellists combined to provide a masterclass around concrete treatments and the increasing challenges around them, explaining to attendees how to choose the right formula for their requirements and touching on issues such as why lithium densifiers are better than sodium and potassium densifiers.
Throughout the session, those watching were treated to informative case studies showcasing how Convergent eco-friendly products are increasing abrasion resistance, raising ease of maintenance, and ensuring the highest quality gloss retention.
By the end of the webinar, a majority of attendees (many of which had not had much experience with Convergent) expressed their interest in using the company’s new generation lithium silicate technology with the rest indicating their desire to learn more about Convergent and its products. Watch the webinar, in full, to discover why viewers were convinced and learn more about advanced floor care solutions for your operations.
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Presenting on an African Review-hosted webinar, Martin Provencher, global industry principal for mining, metals and materials at AVEVA, explored the digital transformation of mining operations and its impact on sustainability.
“Sustainability is becoming a key aspect for mining operations,” remarked Provencher. “If we look at the latest EY research on the top ten business risks and opportunities for mining and metals globally in 2023, ESG remains at the top. Of course, most companies have environmental goals or are expected to reach a net zero emission by 2050, which is a pretty aggressive target. Many of them are targeting 30% reduction by 2030; seven years from now. So there is a lot of action that needs to take place quickly to get there. It is possible to get there, but we need to make sure we are doing this correctly.”
Fast becoming a huge part of ESG initiatives is fleet electrification where particular progress is being made in underground mines. While some countries are certainly more advanced than others here, Provencher noted that 40% of total emissions from the mining industry come from diesel trucks, making EVs a very attractive low-hanging fruit for companies to pursue.
There are, however, a number of challenges associated with bringing in electric vehicles which remains a barrier for introduction. One of the predominant reasons, is the limited range of EVs against diesel counterparts. To mitigate this, Provencher continued, data management is key and ensuring a strong grasp of real-time information coming in will show operators when machinery needs to be charged, allowing them to plan effectively for maximum efficiency on site.
Indeed, this is but a small advantage that digitalisation can bring to the mining industry as it grapples to meet ESG goals while achieving production targets. By getting a better grip of their data and using it to empower tools such as artificial intelligence, advanced analytics and machine learning, companies can achieve tangible benefits such as reduce downtime, enhance worker safety, cut operating costs and, of course, ensure compliance with environmental regulations and targets.
Through the course of the webinar, Provencher outlined this in more detail and explored AVEVA’s suite of cutting-edge software solutions, specifically designed to help mining companies make progress on their digitalisation journey and empower their operations.
Watch the full webinar, completed with detailed case studies and an insightful Q&A session.
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Convergent, in association with African Review, has held a detailed webinar exploring the usage and effectiveness of lithium silicates and densifiers over traditional methods of concrete surface management which often struggle to meet the increasing challenges posed by concrete surface management.
Convergent experts including Mputu Schmidt, CEO of Convergent; Carlos Garcia, product manager end-user solutions, construction chemicals, Spain and Portugal for the RD Group; Matteo Mozzarelli, CEO of concrete Solutions Italia; and Jean-Claude Biard, global senior executive for the Convergent Group, presented across the session.
Together, they delved into the latest cost-effective application methods for long lasting finishing of concrete that can help reduce maintenance costs and avoid unexpected repair action. In addition, they examined the advancements in technologies that can sustain increased abrasion resistant stains and ensure gloss retention to the highest quality.
As part of the webinar, the representatives explored case studies including a case in DRC where a medical centre had been constructed with a low-quality concrete floor. The customer was considering completely replacing the floor but instead, Convergent put forward a special treatment with its 244+ Pentra-Sil lithium hardener, densifier and sealer. With this solution, Convergent can increase the hardness of a surface by up to 40% and therefore saved the customer significant recuperation costs over a complete replacement. Convergent were happy to report that the solution was perfect for the facility and the customer was pleased to avoid the extra construction work that would have been required for a complete replacement.
Watch the full webinar, including more information about Convergent’s innovative solutions.
Infinity Power, a large pure play renewable energy provider, has signed a MoU with the Government of Sierra Leone in order to develop 1GW of renewable energy capacity in the country by 2033
Seen as a significant milestone in the country’s commitment to sustainable energy and economic development, the initiative will begin with feasibility studies conducted by Infinity Power in close collaboration with the Ministry of Energy. After this, attention will turn to securing necessary permits and finalising power purchase agreements (PPA) with the Electricity Distribution and Supply Authority (EDSA). It will include the development of 200MW of renewable energy generation (through the expansion of hydroelectric dam capacity as well as floating and ground-mounted solar systems).
Ahmed Mulla, deputy CEO of Infinity Power, commented "This MoU represents a crucial milestone in our shared vision for a sustainable future. We are committed to working with the Government of Sierra Leone to deliver this ambitious project and contribute to the nation's energy security and economic growth."
The noteworthy agreement was confirmed at a signing ceremony held at State House in Free Town. It marks another tangible step in the Government’s ambitious plans to target investment in generation capacity over the next 10-15 years to allow the country to trade energy with its neighbours. This drive was underscored at the country’s First National Climate Dialogue and Energy Transition Dialogue held in Oct 2023 and organised by the Presidential Initiative on Climate Change, Renewable Energy and Food Security (PI-CREF).
“Our mandate is simple: prioritize the expansion of our energy infrastructure by integrating renewable energy sources and enhance sector reforms to continue attracting investments. Thus, we are excited to partner with Infinity Power and look forward to our work ahead in the coming months and years,” said Eldred Tunde Taylor, Deputy Minister of Energy.
“Given their work in Africa, experience and goals for the continent, Infinity Power is poised to help meet President Bio’s vision for the country earlier than originally envisaged. The deep energy sector reforms taking place are beginning to pay dividends and we at PI-CREF will continue to play our catalytic role in bringing diverse partners with our MDAs through strategic coordination and policy coherence,” underscored Kandeh Yumkella who leads the PI-CREF.
This is the latest in a number of major announcements from Infinity Power with the company committed to making its mark on Africa’s energy landscape. Most recently, it marked another step towards the construction of a 10GW onshore wind farm on the continent. Click here to learn more.
![The project sought to address the high accident rate at the old Breidbach intersection and the traffic congestion. (Image source: SANRAL) The N2 Belstone interchange viewed from overhead.](/images/2024/july/N2-Belstone-Interchange-SANRAL-South-Africa-Construction.webp#joomlaImage://local-images/2024/july/N2-Belstone-Interchange-SANRAL-South-Africa-Construction.webp?width=787&height=399)
The project sought to address the high accident rate at the old Breidbach intersection and the traffic congestion. (Image source: SANRAL)
The N2 Belstone Interchange and route MR0688 lining Bhisho to Zwelitsha to traffic has opened in South Africa
The announcement was made by the South African National Roads Agency SOC Limited (SANRAL) and marks an end to the project that was begun in September 2021. The workscope included the construction of new interchanges at the Belstone and the Breidbach intersections, construction of a link road from Breidbach towards Sweetwaters outside Zwelitsha, free-flowing interchange at Belstone Bridge, dualling of the MR0688 road Bhisho and reinforcement of the concrete structures with the necessary road works.
“The upgrades to this section of the N2 will result in improved management of traffic flow from Bhisho, Breidbach, Zwelitsha and East London, and improved safety for pedestrians and other non-motorised road users,” commented Mbulelo Peterson, SANRAL’s regional manager for its southern region. “The one loop and off-ramp will present safer access to the N2 and improve safety for both motorists and pedestrians.”
A boost for local community
The project was valued at R438mn (approximately US$24mn), with a health proportion being spent on targeted SMMEs. Moreover, SANRAL invested in formal training of 614 locals by accredited training service providers to contribute to the skills development and capacitation of targeted enterprises to ensure they can be self-sufficient beyond the project.
“The benefit to the community goes beyond the new and safer road infrastructure,” continued Peterson. “Through this project, SANRAL was able to create job opportunities for 376 general workers from the local community, with about R106mn spent on wages of targeted labour.”
![The completion of the acquisitions remains subject to NGX completing due diligence in relation to the EPLs. (Image source: Adobe Stock) Large mining quarry machinery driving on site.](/images/2024/july/AdobeStock_194464574.webp#joomlaImage://local-images/2024/july/AdobeStock_194464574.webp?width=787&height=399)
The completion of the acquisitions remains subject to NGX completing due diligence in relation to the EPLs. (Image source: Adobe Stock)
NGX, a leading African explorer and developer, has entered into earn-in joint venture agreements to acquire two uranium exploration project applications in Namibia in a bid to complement its existing graphite assets in Malawi
The two sites are located within the Damara uranium belt of the country, recognised for being one of the world’s best known uranium districts in the world with a number of uranium projects in operation. The two applications include Rossingburg, located in the main uranium production hub of the belt between the Rossing uranium mine and Etango uranium project, and Tubusis, northeast of Swakopmund in an under-explored region of the belt.
“While NGX has been progressing permitting and processing testwork on our flagship graphite projects in Malawi, we have also been looking for opportunities to expand our clean energy minerals portfolio in Africa, to meet the world’s growing need for carbon free energy,” remarked Matt Syme, NGX executive director. “Our management group includes considerable and very successful experience in uranium exploration, so this is a natural addition to our portfolio. We are very optimistic about the outlook for the uranium market and Namibia remains the premier uranium exploration environment in Africa.”
Namibia’s fertile mining environment has found plenty of suitors this year as a number of companies look to take advantage of the business opportunities it offers. Click here to read how B2Gold has been expanding its efforts at the Otjikoto mine in the country.
![The AfDB board complemented Transnet for progress made in rolling out its compliance and governance improvement programme. (Image source: AfDB) Some heavy logistics equipment branded with Transnet logo.](/images/2024/july/transnet-afdb-recovery-plan-south-africa.webp#joomlaImage://local-images/2024/july/transnet-afdb-recovery-plan-south-africa.webp?width=787&height=399)
The AfDB board complemented Transnet for progress made in rolling out its compliance and governance improvement programme. (Image source: AfDB)
The African Development Bank (AfDB) has approved a US$1bn corporate loan to Transnet, a major freight transport and logistics company in South Africa
The company has faced significant operational challenges over the last few years and has been an ever-present stay in media headlines due to underinvestment in infrastructure and equipment, theft and vandalism, and external shocks (such as floods) that have affected critical rail and port businesses.
It has now committed to addressing these past challenges, fostering integrity and enhancing efficiency. This is being pursued, primarily, through its recovery plan that was launched in October 2023 that seeks to rehabilitate infrastructure and accelerate the relaunch of operations over 18 months. Restoring operational performance and freight volumes to meet customer demands has been recognised as a priority.
Vital AfDB support
In order to assist with these recovery and growth plans, AfDB has now committed to a US$1bn corporate loan to Transnet. The 25-year loan – fully guaranteed by the Government of South Africa – will facilitate the first phase of the company’s US$8.1bn five-year capital investment plan.
“Transnet, the custodian of South Africa's critical transport and logistics infrastructure, plays an indispensable role in the economy of the country, ensuring a competitive freight system and serving as a gateway to the SADC region,” commented African Development Bank’s vice president for private sector, infrastructure and industrialisation, Solomon Quaynor. “Our partnership will enable Transnet to execute a comprehensive recovery plan, addressing operational inefficiencies, particularly in rail and port sectors.
“It is aligned with South Africa's strategic 'Roadmap for Freight Logistics System,' and overseen by the National Logistics Crisis Committee, chaired at the Presidency level. This initiative signifies our commitment to enhancing national logistics capabilities and driving sustainable economic growth.”
Michelle Phillips, group chief executive of Transnet, added, “We appreciate the support demonstrated by the African Development Bank, the loan extended by the bank will make a significant contribution to Transnet’s capital investment plan to stabilise and improve the rail network and to contribute to the broader South African economy. The accompanying grant funding to the loan will also greatly assist Transnet with to its energy efficiency efforts and with Infrastructure Project Preparation initiatives.”
![The launch was marked at the Sun Boardwalk Convention Centre. (Image source: Nelson Mandela Bay Business Chamber) Key stakeholders posing for a picture at the launch](/images/2024/july/_DSF5203.webp#joomlaImage://local-images/2024/july/_DSF5203.webp?width=787&height=399)
The launch was marked at the Sun Boardwalk Convention Centre. (Image source: Nelson Mandela Bay Business Chamber)
The Nelson Mandela Bay Business Chamber has launched the Trade and Investment Desk in a bid to position the metro as a diversified manufacturing investment destination and exports hub for Africa
The Desk, in partnership with global auditing, advisory & tax leaders BDO South Africa, global financial services leader Rand Merchant Bank (RMB) and the Eastern Cape Development Corporation (ECDC), is a key driver in the Business Chamber’s strategy to unlock the economic potential of Nelson Mandela Bay to attract and foreign direct investment and enable job creation.
The positioning of the metro as the Bay of Opportunity is aimed to utilise its unique advantages as a two-port city with a strong manufacturing base. This is according to Chamber chief executive Denise Van Huyssteen, who continued, “The Trade and Investment Desk is a strategic driver in bringing this vision to life, working as a united business community along with our partners and key role-players in the trade and investment space to market the Bay as an investment destination of choice and secure catalytic projects that will drive growth.
“The launch of the Desk is a major step forward in resurging the Bay and setting up the local economy for growth and diversification amid massive global advances in technology, new energy and the need for climate resilience. In parallel, as the Chamber is working to improve the enabling environment for business, it is critical that we are proactive in building investor confidence in the advantages of the Bay, and providing support to retain and attract investors.”
Viable new business opportunities
The Trade and Investment Desk will lead on the marketing of Nelson Mandela Bay as an investment destination to secure partnerships with key trade and investment stakeholders. It will also support potential investors with economic data, local information and networking while facilitating trade and export opportunities for local businesses. Moreover, it will support the Chamber’s Local Economy Reinvention Think Tank.
Bonga Mokoena, BDO South Africa CEO, commented, “I believe that as partners, we are aligned in our vision of unlocking economic growth. The Chamber’s Trade and Investment Desk, founded on global investment promotion best practice, will be an important lever in our collective vision and create much needed opportunities for the people, businesses and communities of Nelson Mandela Bay and South Africa at large.”
“Nelson Mandela Bay is the largest commercial centre in the Eastern Cape, an anchor for large-scale trade, investment and tourism, and the automotive manufacturers in the Bay are the largest contributor to provincial manufacturing output and trade,” added, ECDC chief executive Ayanda Wakaba. “It stands to reason that the metro and the Chamber are key partners for the province in economic development.”
The emerging efforts to raise Africa’s share of global manufacturing have been explored in the latest issue of African Review
Manufacturing was a key topic of scrutiny in the African Development Bank’s (AfDB) recently-published ‘2024 African Economic Outlook’, which sought to influence inclusive growth across the continent. While noting that a “single-minded” focus on development through manufacturing should make way for advancing regional diversity and encouragement of wider sectors, it stated that developing manufacturing and reducing the size of exports of unprocessed raw materials “must be part of the economic transformation strategy of African countries.”
While the continent’s share of global manufacturing sits at a paltry 2% today, the development of the sector is still widely regarded as crucial to its ongoing industrialisation and future prosperity. By shaking off the post-colonial reputation as a feedstock for global industrialised economies, African nations can ensure greater value is captured from their vast pool of resources.
Here, a significant opportunity emerges in the form of the continent’s abundance of minerals critical to the energy transition. Already, Africa is positioning itself at the heart of global critical mineral production with countries such as DRC, for example, responsible for more than 70% of global cobalt output. Calls to maximise the reach of these resources are increasing in volume. Speaking at UNCTAD’s ‘Maximising Africa’s Potential’ event in Addis Ababa, UN Economic Commission for Africa’s deputy executive secretary, Antonio Pedro, remarked, “Imagine the potential if African minerals are processed into African batteries, installed into African cars that are driven across the continent and the world... This would accelerate the deployment of renewable energy and the electrification of transport systems on the continent, create decent jobs and make Africa a competitive hub for green industrialisation.”
Click here to read the full article in the latest issue of African Review, including the initiatives being undertaken to realise the green mineral opportunity and the future market for medical manufacturing.