Metro secures a R1,6 billion loan
Tshwane metro secures a mammoth loan for upliftment of its infrastructure.
The Development Bank of Southern Africa (DBSA) and the Tshwane metro signed a R1,6 billion long-term loan facility to support the city’s capital expenditure programme. This follows in the wake of a recent inability of the metro to pay service delivery workers for the overtime they worked.
However, the capital facility aims to accelerate the eradication of backlogs in water and sanitation, roads, electricity and housing-related infrastructure and to support the city’s growth and development initiatives.
”Supporting municipalities to deliver socio-economic infrastructure remains an important focus area for the DBSA to address the country’s triple challenges of high unemployment, poverty and inequality.
In the metropolitan municipalities, in addition to providing bilateral loans, the DBSA participates in public bond issuance programmes and other funding including project finance to accelerate the delivery of social and economic infrastructure such as the Bus Rapid Transport system,” Selby Bokaba, spokesperson for the metro, said.
The city manager, Jason Ngobeni, said that the facility will be used to aggressively fast track the metro’s infrastructure capital programme designed to match the long-term assets to be created.
”This is the inaugural 20-year loan tenure for the metro, which remarkably coincides with the celebration of the country’s 20 years of democracy. This level of capital investment in the city was, in part, necessitated by the need to improve the enlarged infrastructure of the city, which now includes the former municipalities of Metsweding, Nokeng Tsa Taemane and Kungwini,” he said.
“In this financial year, 37% of the capital programme is funded through long-term borrowing and the rest being from capital grants and internal resources,” Ngobeni added.
The group executive for the DBSA, TP Nchocho, said this facility forms part of the DBSA’s continuous and accelerated support to municipalities in eradicating infrastructure backlogs.
“Like many other metropolitan municipalities in South Africa, the Tshwane metro has its substantial infrastructure backlogs which create challenges in facilitating and increasing access of basic services to its constituencies, particularly those in the previously disadvantaged areas.
We are pleased to be part of this capital expansion programme, which signifies the DBSA’s commitment to contribute towards the development of social and economic infrastructure in the metro area, which is much needed to improve the quality of life of its 2,9 million residents,” he said.
”In ensuring that metropolitan municipalities remain the heartbeat of the country’s economic growth, the DBSA has therefore embarked on a process to package a comprehensive support programme aimed at addressing each metro’s unique requirements while at the same time ensuring that the bank delivers on its development mandate,” added Nchocho.
