€300m AFD loan to assist Transnet’s transition to low-carbon operating model
French Ambassador to South Africa, Lesotho and Malawi David Martinon (left), with AFD’s regional director for Southern Africa Marie-Hélène Loison and Transnet CEO Michelle Phillips at the signing ceremony.
State-owned freight logistics group Transnet has signed a €300-million (R5.8-billion) with Agence française de développement (AFD) to support its transition to a low-carbon operating model.
The loan is linked to South Africa’s Just Energy Transition Investment Plan, and fulfils France’s larger €1-billion commitment announced at COP26.
Loan proceeds have not been allocated to specific investments, with Transnet retaining the flexibility to deploy funds across a widely defined programme.
However, disbursements are conditional on Transnet achieving certain mutually-agreed milestones, including:
- enabling a shift of freight from road to lower‑carbon rail transport by rehabilitating 550 km of rail along the Cape and Container corridors;
- enhancing Transnet’s strategic business diversification by potentially replacing coal volumes with green hydrogen and transition minerals;
- supporting the procurement of 30 MW of renewable energy; and
- strengthening Transnet’s environmental, social, and governance capacities.
“These milestones are intended to reduce emissions intensity across Transnet’s operations, strengthen the climate resilience of priority corridors, and deliver governance improvements that reinforce Transnet’s long‑term climate change resilience,” AFD and Transnet said in a joint statement.
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