Bank of China, IDC sign agreement on R10bn funding package

Trade, Industry and Competition Minister Ebrahim Patel and China-Africa Development Fund chair Song Lei at the MoU signing, which took place at the BRICS Manufacturing Forum in Midrand

Trade, Industry and Competition Minister Ebrahim Patel and China-Africa Development Fund chair Song Lei at the MoU signing, which took place at the BRICS Manufacturing Forum in Midrand

22nd August 2023

By: Terence Creamer

Creamer Media Editor


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South Africa’s Industrial Development Corporation (IDC) and the Bank of China (BoC) have signed a framework agreement that could unlock a R10-billion funding package over the next five years to support regional projects in energy, infrastructure, manufacturing, agriculture, and mining.

Signed ahead of the Brics summit in Johannesburg, BoC CEO Dr Longjian Chen said the agreement highlighted the bank’s resolution to partner with South Africa in sustainability, just energy transformation and other funding initiatives.

Chen also chairs the South Africa and China Economic and Trade Association.

The agreement’s other objective is to formalise the relationship between the IDC and BoC and strengthen their cooperation on funding initiatives, especially Chinese foreign direct investment into South Africa.

IDC CEO TP Nchocho said the lack of access to capital remained one of the biggest challenges affecting entrepreneurs across the continent.

“This framework agreement therefore will bring to fruition capital mobilisation and technology cooperation, among other benefits, which should ultimately lead to integration of regional economic and industrial development across the continent,” Nchocho said.

Meanwhile, a memorandum of understanding (MoU) was also signed between the Department of Trade, Industry and Competition and the China Africa Development Fund (CADF), which has an equity investment fund managed by the China Development Bank.

Signed in Midrand by Trade, Industry and Competition Minister Ebrahim Patel and CADF chairperson Song Lei, the MoU reportedly aimed to stimulate increased industrial investments from China into South Africa

The fund has invested more than $5-billion in Africa to date and is already active in South Africa’s electronics, capital equipment, steel and resources sectors.

The MoU makes specific reference to co-funding green economy projects, including those related to electric vehicles, green hydrogen and critical-minerals processing.

"These MoUs set the stage for transformative collaborations that will significantly contribute to South Africa's industrial growth, technological advancement, and economic prosperity," Patel said.

Edited by Creamer Media Reporter



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