South Africa has secured a $1 billion loan from the New Development Bank (NDB), the multilateral lender established by BRICS nations, to upgrade critical infrastructure in the country’s eight largest metropolitan municipalities.
The financing will support investments in essential urban services, including water supply, sanitation, electricity, and solid waste management, as Africa’s largest economy seeks to address years of infrastructure deterioration that have undermined service delivery and economic activity. The original BRICS members are Brazil, Russia, India, China and South Africa.
The NDB said the programme would benefit Buffalo City, Cape Town, Ekurhuleni, eThekwini, Johannesburg, Mangaung, Nelson Mandela Bay and Tshwane — municipalities that collectively account for a substantial share of the country’s economic output and population.
“The programme aims to boost investments in the provision of essential urban services, including water supply and sanitation, electricity and solid waste management in South Africa’s metropolitan municipalities,” the bank said in a statement.
According to the lender, the project is expected to improve living conditions for residents while enhancing the business environment in the targeted cities, supporting South Africa’s National Development Plan 2030.
The loan comes as the country grapples with aging infrastructure, rising urbanisation pressures and persistent service delivery challenges that have affected water, electricity and waste management systems in several major cities.
The funding also aligns with broader reforms by South Africa’s National Treasury aimed at unlocking infrastructure investment in metropolitan areas. In March, the Treasury launched metro trading services reforms to improve the performance of water, electricity and waste services in the country’s eight metros, which together generate more than two-thirds of South Africa’s economic activity.
The reforms are backed by R54 billion in performance-linked grants designed to encourage municipalities to ring-fence revenues for infrastructure spending, with the goal of mobilising up to R100 billion in additional investment.
The NDB, headquartered in Shanghai and led by former Brazilian president Dilma Rousseff, has become an increasingly important source of development financing for BRICS members and emerging economies.
The South Africa facility adds to a growing pipeline of infrastructure projects financed by the bank in the country. In December, the NDB approved $200 million for the Limpopo Academic Hospital project, which will fund the construction of a 488-bed teaching hospital in Polokwane.
The bank has also approved $205 million for the Magalies bulk water supply scheme, a project expected to provide reliable drinking water to about two million residents while addressing future demand growth.
The latest approval underscores the expanding role of BRICS-backed institutions in financing Africa’s infrastructure deficit at a time when governments across the continent are seeking alternative sources of long-term development capital.