Johannesburg – South Africa is to receive 600 million euros ($603 million) from France and Germany as part of an ambitious investment plan to help its energy transition green-lighted at the COP27, the three countries announced on Wednesday.
“South Africa, France and Germany have signed loan agreements for the two European nations to each extend €300 million in concessional financing to South Africa to support the country’s efforts to reduce its reliance on coal,” a joint statement read.
South Africa, one of the world’s top 12 largest polluters, generates about 80 percent of its electricity through coal.
Earlier this week, at the UN’s COP27 climate summit in Sharm el-Sheikh, wealthy nations endorsed a $98 billion investment plan put forward by Africa’s biggest economy to move away from the polluting fuel.
This followed a pledge of $8.5 billion in grants and loans undertaken by Britain, France, Germany, the United States and the European Union last year.
“We are now putting those words into actions with this important loan,” said Arnaud Roux, charge d’affaires of the French embassy in South Africa, announcing the loan agreement.
The deal comes as developed countries are under pressure to step up efforts to help their poorer peers make their economies green.
According to a UN-backed report released Tuesday, developing countries and emerging economies need investments well beyond $2 trillion annually by 2030 if the world is to stop the global warming juggernaut.
Speaking at the COP27 summit on Tuesday, South Africa’s President Cyril Ramaphosa criticised international funders for making it difficult for poorer nations to access aid to fight climate change.
South Africa will require at least $500 billion dollars to achieve carbon neutrality by 2050, according to the World Bank.