South Africa - Loan to the City of Johannesburg Metropolitan Municipality for electricity, water and sanitation, solid waste projects

The scope of the transaction entails the Provision of an African Development Bank (AfDB) senior unsecured loan facility to the City of Johannesburg (CoJ) amounting to ZAR 2.5 billion (Under Subnational finance Guidelines) to support CoJ’s capital expenditure (CAPEX) needs, which will be used for maintaining and expanding delivery of basic services to its population. CoJ has struggled to meet rising demand for basic services from its growing population of residents within the Johannesburg metropolis with subsectors like energy, water, sewerage / sanitation, solid waste management taking the biggest toll due to lack of adequate financing to sustain the expansion of capacity needed to keep pace with rising demand. Therefore, the loan will seek to help address the financing gap in the aforementioned subsectors by unlocking additional funding towards CoJ’s critical sectors thereby enhancing productive capacity in the City. The CAPEX funds will be used by CoJ to exclusively finance capex requirements under trading services for electricity, water and sewage, and solid waste management projects. These projectshave been identified and defined and are primarily on brownfield sites. Most are already under implementation.