Afreximbank Unlocks US$750mn South Africa Infrastructure Deal

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The African Export-Import Bank has secured a landmark partnership with South Africa’s government to fast-track stalled infrastructure projects through a Joint Project Preparation Facility expected to unlock at least $750 million in critical investments across energy, transport, and digital sectors.

The agreement, formalized Tuesday during the Intra-African Trade Fair in Algiers, directly addresses what officials describe as South Africa’s most persistent infrastructure bottleneck: the chronic failure to transform project concepts into bankable, implementation-ready ventures that attract private financing.

The IATF2025 event generated more than $48 billion in trade deals with over 112,000 participants and featured 20 Heads of State and Government representatives, positioning the South African deal among the fair’s highest-profile agreements.

South Africa’s Infrastructure South Africa programme, operating under the National Department of Public Works and Infrastructure, will combine resources with Afreximbank’s financial expertise to accelerate project preparation phases that industry experts identify as the primary constraint on African infrastructure development.

Deputy Minister Kenny Molong emphasized that “The slow progression of project concepts into fully implemented projects often stems from insufficient vigour in the project preparation phase”, highlighting systemic challenges that extend beyond South Africa to affect infrastructure delivery across the continent.

The partnership represents Afreximbank’s strategic focus on regional economic powerhouses as catalysts for broader continental development. Research indicates that “a dearth of bankable projects—projects that meet the stringent requirements of financiers—remains a key bottleneck to investment in developing countries”, making project preparation facilities increasingly critical for unlocking private sector participation.

Afreximbank’s Managing Director of Export Development Oluranti Doherty described the collaboration as essential for establishing “a cohesive and interconnected infrastructure ecosystem” that extends benefits beyond South Africa into the broader Southern African Development Community region.

The facility will focus specifically on de-risking projects during preparation phases, addressing what Doherty identified as critical stages where inadequate technical expertise and insufficient funding typically derail promising infrastructure concepts before they reach implementation.

Infrastructure South Africa operates as “a catalyst for closing the infrastructure investment gap” and provides “best practices in project preparation, leadership on infrastructure planning, technical and financial support for nationally prioritised infrastructure projects”, making it an ideal partner for Afreximbank’s continental infrastructure strategy.

The timing proves particularly significant as previous analysis indicated that “almost a quarter of South Africa’s 340 billion rand ($21.7 billion) worth of strategic infrastructure projects have been delayed or put on hold”, demonstrating the scale of preparation and execution challenges facing the country’s development agenda.

ISA Acting Head Mameetse Masemola characterized the agreement as “a huge milestone” aligned with President Cyril Ramaphosa’s infrastructure acceleration mandate, suggesting that the facility represents a fundamental shift in how South Africa approaches project development and financing.

The partnership emerges as African governments increasingly recognize that traditional infrastructure financing approaches inadequately address preparation phase requirements. Most development finance institutions focus on construction and implementation rather than the detailed feasibility studies, market analysis, and risk assessments that transform concepts into investible opportunities.

Industry observers note that project preparation facilities have proven particularly effective in addressing what economists term the “missing middle” in infrastructure financing – the gap between initial concept development and full-scale project implementation that often spans multiple years and requires specialized technical expertise.

The South African deal follows similar Afreximbank agreements across the continent, including a recent $1 billion partnership with Shelter Afrique Development Bank, indicating the institution’s systematic approach to addressing infrastructure bottlenecks through enhanced project preparation capabilities.

For South Africa’s economy, the facility promises accelerated delivery of critical infrastructure that supports broader industrialization goals and private sector investment attraction. The country’s infrastructure challenges have historically constrained economic growth and competitiveness, making improved project preparation capabilities strategically essential.

The agreement’s focus on energy, transport, logistics, and digital infrastructure aligns with South Africa’s economic reconstruction priorities and regional integration objectives. Successful implementation could establish a model for similar partnerships across Africa, potentially transforming how the continent approaches infrastructure development financing.

As African governments seek innovative financing mechanisms to address infrastructure gaps estimated in hundreds of billions of dollars, the Afreximbank-South Africa partnership represents a potentially replicable approach that addresses fundamental preparation constraints rather than simply providing construction financing.

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