The European Union (EU) has announced a major investment package worth €11.5 billion ($13.3 billion) for South Africa, targeting clean energy, infrastructure, and pharmaceutical development projects.
The announcement, made on Thursday, forms part of efforts to strengthen economic cooperation between Europe and Africa while accelerating South Africa’s transition to renewable energy.
According to the EU, a significant portion of the funding will be channelled towards expanding power generation capacity, upgrading the national grid, improving energy storage systems, and developing green hydrogen projects.
South Africa’s economy, currently grappling with slow growth and high unemployment, is seeking foreign investments to stimulate development. The country has also been hit by recent U.S. tariffs that have impacted its export performance.
Also Read: EU Proposes Sanctions, Trade Curbs on Israel over Gaza war
The EU statement highlighted the Coega Green Ammonia Project, designed to meet rising global demand for green ammonia used in agriculture, chemicals, and mining. The investment will also enhance the production of vaccines and other pharmaceuticals in South Africa, positioning the country as a manufacturing hub for the African continent.
European Commission President Ursula von der Leyen had earlier pledged €4.7 billion during a visit to South Africa in March. It remains unclear whether that amount forms part of the new investment or is separate.
South Africa’s export sector has recently suffered setbacks following a 30% tariff imposed by U.S. President Donald Trump in August, alongside the expiry of a major U.S. trade initiative with Africa at the end of September.
South African officials are currently engaging with the U.S. administration to negotiate a reduction in the tariffs.
