China pledged to invest US$14.7 billion in South Africa, granting loans to Eskom and Transnet for R33.2bn and R4bn respectively as the two countries seek to strengthen economic ties and increase trade, Bloomberg reports.
The news on the eve of the 10th Brics summit in Sandton had an immediate effect on the rand as it regained ground it had lost to the Greenback.
It also bodes well for investment as Eskom’s disastrous financial results released on Monday fuelled fears that the power utility is on its knees.
According to reports earlier this week, Eskom suffered losses of R2.3bn and R4.6bn – the one overall, including all its subsidiaries, and the biggest blow coming from its power-generating business.
Bloomberg writes that China’s “commitment follows similar promises from Saudi Arabia and the UAE, adding that it “bolsters President Cyril Ramaphosa’s campaign to lure $100 billion in investment to South Africa over the next five years.
The investment pledge and loans, the biggest yet from the Asian nation to South Africa, were announced after a meeting between Ramaphosa and his Chinese counterpart, Xi Jinping, at the Union Buildings on Tuesday.
