The Industrial Development Corporation of SA (IDC) and the Bank of China (BoC) have signed a R10 billion funding framework agreement in one of the key developments ahead of the BRICS Summit, which kicks off on Tuesday.
Signing the agreement would strengthen trade and investment, explaining that the IDC and BoC R10 billion funding package would be over the next five years, the entities said.
IDC chief executive Tshokolo Petrus Nchocho said the lack of access to capital was one of the impediments to accelerating regional industrial development.
He said he was optimistic about regional economic prospects in the wake of the agreement.
“Our helicopter view as one of the leading development funding institutions in sub-Saharan Africa has informed us that lack of access to capital remains one of the biggest challenges affecting entrepreneurs across the continent,” said Nchocho.
“This framework agreement therefore will bring to fruition capital mobilisation and technology cooperation among other benefits which should ultimately lead to integration of regional economic and industrial development across the continent.”
He said the energy, infrastructure, manufacturing, agriculture, and mining sectors would benefit from the agreement which also seeks to explore opportunities to enhance the cooperation to co-fund potential future business with the BoC Johannesburg acting on the debt financing side.
The agreement will also see the BoC’s Johannesburg office providing R10 billion towards joint investments within the next five years and also explore potential business collaboration initiatives investment projects in mining, agriculture, telecommunication and infrastructure development.
Dr Longjian Chen, who chairs the South Africa and China Economic and Trade Association (SACETA), said in the 23 years of the BoC Johannesburg branch they had strong supported social welfare and economic development efforts in Africa.
“This Framework Agreement highlights BoC’s resolution in partnering with South Africa in Sustainability, JUST Energy Transformation and other funding initiatives,” he said.
Chen said the Bank of China would continue to play a key role in helping strengthen SA’s economic and industrial development.
Meanwhile, President Cyril Ramaphosa is expected to host Chinese President Xi Jinping as part of a State Visit at the Union Buildings in Pretoria.
It will be his fourth State Visit to Pretoria as one of the world's leading economies looks to strengthen relations with SA.
“The State Visit takes place within the context of celebrating 25 years of diplomatic relations between the two countries, while historic ties date back to the Bandung conference of 1955.
“Relations between South Africa and the People’s Republic of China are governed by a Comprehensive Strategic Partnership (CSP), whose programme of action is set out in a Ten-Year Strategic Programme of Cooperation (2020–2029),” said the Presidency at the weekend.
Ramaphosa's office said China was an important investor in SA and provided support on infrastructure development projects including the Small Harbour Development Project, the TVET Refurbishment Project and the Mzimvubu Water Project, all of which were instrumental in job creation.
They said discussions would explore further collaboration and partnerships the two nations can leverage on to solidify existing diplomatic, economic and people-to-people relations.
Late on Monday night, Ramaphosa along with a delegation of Cabinet ministers, welcomed Jinping as he touched down at the OR Tambo International Airport to traditional song and dance.
IOL