South Africa has secured a $1.5 billion Development Policy Loan from the World Bank to tackle severe infrastructure bottlenecks, accelerate growth, and generate nearly 600,000 jobs by 2032, the National Treasury announced on Tuesday.
The concessional facility, issued through the International Bank for Reconstruction and Development, carries a 15-year maturity and a three-year grace period at SOFR plus 1.35%, helping manage rising national debt-service costs.
Together with parallel development partner funding, the loan enables the government to complete its $3.2 billion foreign currency borrowing requirement for the 2026/27 financial year, expanding structural interventions across critical network sectors.
The package targets electricity market competition, private rail operation, port concessions in Durban, and for the first time in this loan series major regulatory and investment reforms in municipal water and sanitation services.
These initiatives are driven by Operation Vulindlela, a joint program by the Presidency and Treasury aimed at elevating annual gross domestic product growth above 3% after a decade of averaging under 1%.
Recently, power grid stability has prevented scheduled blackouts for 18 months, private renewable energy investment has surged sixfold, and freight volumes through key rail corridors are up 50%.
Finance Minister Enoch Godongwana emphasized that the package reflects Pretoria’s resolve to remove structural barriers that have long stymied private sector investment, economic expansion, and sustainable employment creation.
World Bank estimates indicate the targeted interventions will support approximately 280,000 direct and indirect jobs by 2027, rising to more than 560,000 over the next six years.
