Agence française de développement backs Transnet’s sustainability drive with major funding
South Africa’s state-owned logistics company, Transnet, has secured a EUR 300 million (about ZAR 5.8 billion) loan from the Agence française de développement (AFD) to advance operational sustainability and address climate change.
The funding supports the “Transnet Freight Decarbonisation and Corporate Sustainability Program,” aimed at improving efficiency and reducing carbon intensity in line with South Africa’s Just Energy Transition Investment Plan (JET-IP).
Transnet Group Chief Executive Michelle Phillips emphasised the company’s commitment to modernising rail and port infrastructure. “This funding will assist in achieving these objectives by enhancing energy efficiency and accelerating reforms,” she said.
The partnership builds on a relationship dating back to 2009, when AFD financed the expansion of Transnet’s Cape Town Container Terminal. Marie-hélène Loison, AFD’s Regional Director for Southern Africa, noted that Transnet plays a strategic role in South Africa’s low-carbon transition and economic competitiveness.
This new partnership between South Africa and France is set to usher in a remarkable era of sustainability for Transnet, aimed at combating climate change and ensuring economic resilience. Discover how this EUR 300 million loan is poised to transform South Africa’s logistics landscape.
Disbursements of this loan are conditional on Transnet achieving certain mutually-agreed
milestones, including:
- Modernisation of core transport operations to improve service quality and reliability.
This will be achieved through the rehabilitation of 550 km of rail along the Cape and
Container corridors -improving reliability and enabling a shift of freight from road to
lower‑carbon rail transport; - Enhancement of Transnet’s strategic business diversification (explore green hydrogen
and transition minerals logistics to replace the anticipated decline in coal volumes); - Preparation for the procurement of 30 MW of renewable energy to support the pathway
to net-zero emissions; and - Strengthening of Transnet’s ESG capacities.