Statement by Andrew de Blocq MP – DA Spokesperson for Forestry, Fisheries, and Environment:
The Democratic Alliance (DA) welcomes the latest announcement of a €300 million (R5.8 billion) loan agreement between the French Development Agency (AFD) and Transnet to reduce the carbon emissions of the entity’s rail and port operations. France is South Africa’s largest foreign investor.
These funds will be used in transitioning to a low-carbon operating model and to ensure operational efficiency for the freight industry, thereby reducing its carbon footprint.
This comes hot on the heels of the April announcement of a €200 million concessional climate loan from Germany. This will support the rollout of renewable energy in South Africa.
European funding has become the cornerstone of South Africa’s Just Energy Transition Investment Program funding after the USA withdrew the bulk of their climate support for South Africa and other countries across the world.
While growing the economy and creating jobs are the primary objectives of the GNU government, this needs to be supported by improvements and growth in energy availability while simultaneously reducing carbon emissions in line with global commitments. While investor appetite for solar and wind generation is plentiful, government will likely have to finance the less investable expansion of the transmission grid to unlock renewable energy rollout. This is one aspect where foreign climate financing can play a key role, given South Africa’s domestic fiscal constraints.
In the latest Parliamentary Portfolio Committee meeting, the Department of Forestry, Fisheries, and Environment presented its plans to begin operationalising the Climate Change Act, particularly through support to local governments, which was supported by a significant shift in budget allocations towards its Climate Change and Air Quality Program. The Department, through this program, has set its own annual target of raising $100 million (R1.6 billion) from international sources to support local projects.
Minister Willie Aucamp has used recent appearances at the 17th Petersberg Climate Dialogue in Berlin to call for adequate funding support for climate change mitigation and adaptation projects in order for developing countries to effectively meet their Nationally Determined Contributions.
The DFFE in 2025 requested R704 million from National Treasury to enact the Climate Change Act yet only received R10 million. This highlights the vast gap between the funding needed for climate change efforts and the domestic fiscal flexibility to meet this demand. South Africa will need to rely on concessional loans, grants, and project funding from international sources to close this gap.
The DA is grateful to European funders who are increasingly stepping up to assist South Africa in meeting its climate goals.
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