For more financial news, go to the News24 Business front page.The African Development Bank (AfDB) has approved a $1 billion loan for South Africa’s Transnet to aid the troubled logistics firm’s recovery plan, the bank and the company said on Thursday.
State-owned Transnet has struggled to provide adequate freight rail and port services in South Africa due to equipment shortages and maintenance backlogs after years of under-investment.
This has impacted commodity exports and other sectors, such as manufacturing and retail, weakening Africa’s most advanced economy.
Transnet and the AfDB said in a joint statement that the 25-year loan was fully guaranteed by the government of South Africa.
“It will facilitate the first phase of the company’s ZAR 152.8 billion ($8.1 billion) five-year capital investment plan to improve its existing capacity ahead of expansion for the priority segments throughout the transport value chain,” the statement said.
Transnet’s recovery plan, announced in October 2023, seeks to restore freight volumes and return the company to profitability over a period of 18 months.
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