Cape Town secures R3.5bn finance towards infrastructure spend
Cape Town secures R3.5bn finance towards infrastructure spend
The City of Cape Town has secured a further R3.5 billion in financing from Nedbank towards its plans for infrastructure investment over three years, following Council green-lighting the finance earlier this month.
The city plans to spend R39.5bn on infrastructure from July 2024 – June 2027, as approved in its ‘Building For Jobs’ Budget.
Cape Town accounted for a full 60% of the R100bn in overall government infrastructure projects announced nationally in 2023, according to Nedbank's updated Capital Expenditure Project Listing for 2023, published in February 2024.
Mayor Geordin Hill-Lewis said finance towards the City’s ambitious infrastructure investment agenda was estimated to create 130 000 construction-related jobs alone over three years.
Hill-Lewis said lower-income households will also directly benefit from 75% - or R9bn - of Cape Town’s R12bn infrastructure spend in 2024/25.
“This pro-poor infrastructure spend in 2024/25 is bigger than the entire infrastructure budget of any other metro,” he said.
“Cape Town will soon be SA’s most populous city, and we are preparing for this by targeting our fastest-growing, and poorest areas, with infrastructure projects that will, over time, unstitch the unjust legacy of our country’s past.”
The City’s 10-year pipeline is valued at an estimated R120bn. The majority of the projects are classified as ‘Economic, Social and Governance (ESG)’ and linked to the City’s overall Climate Change Strategy.
In October 2023, the City published a request for funding proposals (RFP) for financial years 2023/24 and 2024/25, which was followed by extensive engagements with local and international lenders.
The City is following a blended finance model, which includes funding from its own healthy balance sheet, as well as finance from the local and international markets.
Further financing agreements are set to serve before Council during the 2024/25 financial year regarding the balance of the funding requirements for the City’s infrastructure plans.
BUSINESS REPORT