South Africa has received a $150 million development policy loan from the OPEC Fund for International Development to support major economic reforms. The country’s National Treasury announced the agreement on Wednesday.
The Treasury said this marks the first loan arrangement between South Africa’s government and the OPEC Fund.
“The loan will support government’s ongoing reform programme aimed at unlocking infrastructure bottlenecks, particularly in the energy and freight transport sectors,” the statement said.
Officials explained that the funding will help the government tackle long-standing infrastructure challenges, especially in energy supply and freight transport systems. They added that the reforms aim to improve efficiency and support economic growth.
The Treasury also said the loan fits into its broader strategy to diversify funding sources. It added that the government wants to avoid putting too much pressure on debt servicing costs while securing development finance.
The loan comes with a six-year repayment period and a two-year grace period before repayment begins. It also carries an interest rate based on the six-month Secured Overnight Financing Rate plus 1.25 percent, according to the Treasury.
This is a monitored news from Reuters by The Ghana Report.
