Agence Française de Développement (AFD) [fr]

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AFD Group and South Africa

The AFD Group is made up of three entities: AFD, Proparco and Expertise France.

AFD provides support to public sector actors: the state, the municipalities, the state owned enterprises, or the public development banks.

Proparco is a subsidiary of AFD, focused on private sector development. Proparco provides support to businesses and financial institutions in key development sectors such as infrastructure (with a specific focus on renewable energies), agribusiness, healthcare, education, etc.

Expertise France is the French public agency for the design and implementation of technical support projects.

AFD has been active in South Africa since 1994, offering innovative financing solutions to support the South African government in its development policy.

The AFD office in South Africa is also a regional direction that covers 10 countries in Southern Africa: In addition to South Africa, AFD operates in Angola, Botswana, Eswatini, Lesotho, Namibia, Malawi, Mozambique, Zambia, and Zimbabwe.

As a member of the “Team Europe”, AFD works closely with the European development institutions to offer a consolidated proposal to its South African partners.

Our activity in South Africa

3 billion Euros of projects financed as of 2021
AFD’s intervention strategy in South Africa is structured around four priority areas:

  1. Supporting the Just Energy Transition
  2. Support for resilient, sustainable and balanced urban and territorial development
  3. Creating opportunities for all and reducing social and economic inequalities
  4. Protecting and restoring South Africa’s biodiversity

Supporting the Just Energy Transition

South Africa has access to a wealth of renewable energy sources, with enough wind and solar resources to provide gigawatts of power.

To promote a just low carbon energy transition in South Africa, AFD supports the development of efficient, low-carbon energy services that are accessible to everyone. It relies on three major assets: diversified financing, tailored technical support, and a large network of partners.

France is involved in the Just Energy Transition Partnership signed during COP26 last year and the French contribution will entirely be channeled through AFD.

Today, AFD wishes to more broadly support South Africa’s low carbon energy transition through different supports, for example:

  • financing to the National government and municipalities, focusing on the just part of the transition, addressing the impact of phasing out of coal for territories in Mpumalanga
  • financing and peer to peer exchanges with ESKOM to assist with the unbundling of the utility and the transition of its energy mix.

Support for sustainable and balanced urban and territorial development

AFD supports South Africa’ sustainable urban development policy, which aims to make cities and human settlements inclusive, safe, resilient and sustainable. AFD provides direct loans to metropolitan municipalities for infrastructure projects and to fund capital budgets to support development policies. It also uses financial intermediaries to support small and medium sized municipalities in their basic infrastructure investments.

South Africa’s largest cities have been tapping into AFD’s expertise in their effort to promote more carbon-efficient urban development and greater resilience to climate change.

Creating opportunities for all and reducing social inequalities

AFD regards vocational training and access to decent employment, especially for previously disadvantaged youth, as key to unlock the economic potential of the country. Currently, more than half of young people aged 15-24 are unemployed in South Africa.

AFD is supporting the South African government through local research facilities, to tackle social and economic inequalities, particularly in context of the Just Transition.

Protecting South Africa’s biodiversity

Protecting biodiversity is central to AFD’s actions. To halt the loss of biodiversity and protect ecosystems, AFD is supporting the restoration and sustainable management of natural areas, with and for the benefit of local populations. AFD integrates this dimension in all its development policies.

AFD works with countries’ national and local authorities to provide peer-to-peer cooperation between leading actors in biodiversity and conservation, and to fund innovative approaches to preserving and restoring ecosystems, sustainably managing forests, combating desertification, halting and reversing the process of land degradation and ending the loss of biodiversity.

publie le 30/08/2022

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