Aug 08, 2012
Ex-Im chief confirms SA’s priority-market status, makes $2bn energy commitmentBack
Johannesburg|Eskom|Ex-Im Bank|Export-Import Bank Of The US|Industrial Development Corporation|Renewable Energy|Africa|South Africa|United States|USD|Bank|Clean-energy Projects|Conventional Energy Projects|Energy Sector|Export-credit Insurance|Loan Finance|Renewable Energy Projects|Transport|Barak Obama|Franklin Delano Roosevelt|Fred Hochberg|Hillary Clinton|Boeing 737-800|Sub-Saharan Africa
© Reuse this
Speaking at a media roundtable in Johannesburg, chairperson and president Fred Hochberg stressed that there was no expiry date associated with the financing arrangement. It had been approved in line with the identification of South Africa as one of Ex-Im Bank’s top-nine priority markets – the bank operates in 180 countries globally.
Most of the loan finance would flow towards clean-energy projects, but the capital was also available for conventional energy projects, as well as transmission and smart-grid-related developments.
The bank provides a variety of financing mechanisms, including working capital guarantees, export-credit insurance and financing to foreign buyers.
Hochberg signed a declaration of intent with South Africa’s State-owned Industrial Development Corporation, which was financing a number of renewable energy projects. “This agreement will help ensure that Ex-Im Bank continues to provide financing to South African buyers that want to buy high-quality US goods and services,” he elaborated.
The self-funding government agency was confined to supporting US products and services deployed in such projects and would only be disbursed in instances where firm power offtake agreements were in place.
South Africa was in the process of procuring 3 725 MW of renewable energy capacity for deployment between 2014 and 2016, while State-owned power utility Eskom was in the middle of a R330-billion investment programme to add 11 719 MW and 6 596 km of transmission by 2018.
Ex-Im Bank extended a $805.6-million direct loan to Eskom in 2011, enabling the utility to purchase engineering and construction management services from Black & Veatch, which is involved with the construction of the Kusile coal-fired power plant, in Mpumalanga. It also approved a loan guarantee of more than $100-million as part of General Electricity Transportation’s sale of locomotives to Transnet.
The agency, which was established by President Franklin Delano Roosevelt in 1934 as part of the New Deal, approved a record $32.7-billion in loans last year, of which about $1.5-billion was associated with exports to sub-Saharan Africa.
During the same period, it authorised more than $930-million in financing to support US exports to South Africa, including a commitment to finance Comair’s purchase of eight Boeing 737-800 aircraft.
Hochberg indicated that the growth in authorisations had been underpinned by President Barak Obama’s National Export Initiative, but had been spurred further by a growing appetite among US firms to export to emerging markets that US commercial banks saw as high risk.
He expected that 2012 authorisations would exceed the 2011 record, which itself was more than double the $14.5-billion in approvals recorded in 2008, the year Obama was elected.
Besides the infrastructure programme, he saw potential in South Africa and Africa for US exports into the extractive and mining sectors, as well as the aviation, transport and healthcare markets.
Edited by: Creamer Media Reporter© Reuse this Comment Guidelines
Other Electricity News
Recent Research Reports
Defence 2013: A review of South Africa's defence industry (PDF Report)
Creamer Media’s 2013 Defence Report examines South Africa’s defence industry, with particular focus on the key players in the sector, the innovations that have come out of the defence sector, local and export demand, South Africa’s controversial...
Road and Rail 2013: A review of South Africa's road and rail infrastructure (PDF Report)
Creamer Media’s Road and Rail 2013 Report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move...
Liquid Fuels 2013 (PDF Report)
Creamer Media’s 2013 Liquid Fuels report examines South Africa’s liquid fuels market, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing,...
Projects in Progress - Second Edition (PDF Report)
Creamer Media’s second Projects in Progress supplement considers some of the major project developments under way, including high-profile energy and transport projects, as well as a few of the lower-profile public and private developments. What remains apparent is...
Water 2013: A review of South Africa’s water sector (PDF Report)
Creamer Media’s Water 2013 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.
Canadian Mining Roundup for June 2013 (PDF Report)
The June 2013 roundup includes details of the development of TSX-V-listed Aldridge Minerals’ flagship Yenipazar polymetallic project, in Turkey; the Canadian Nuclear Safety Commission’s renewal of Cameco’s uranium mining licence pertaining to the Cigar Lake...
This Week's Magazine
Mitsubishi Motors South Africa (MMSA) has introduced a 4x2 derivative of its Pajero Sport sports-utility vehicle (SUV), which will give it access to a substantial slice of the full-size SUV market, where it will compete with the likes of the Ford Everest, Chevrolet...
South African Energy Minister Ben Martins has affirmed that the government wants the country to be globally competitive in the nuclear sector. "Our responsibility has always been ... to ensure that, in nuclear energy, South Africa can compete with the rest of the...
Mercedes-Benz South Africa (MBSA) president and CEO Dr Martin Zimmermann describes the new S-Class as “a special place to be”, with the car creating a sense of “wellness” once you are seated inside the German brand’s flagship model. It is difficult to argue...
Water scarcity and water-quality issues are broadly recognised and understood in most political, business and civil organisations in South Africa, but solving water issues will require wide and continuous action in catchments and municipalities by organisations and...
Work is well under way on the R212-million Imvutshane dam, 30 km north-west of Stanger, in KwaZulu-Natal, which is a key link in supplying people in rural Maphumulo with a reliable source of safe drinking water.