The New Development Bank (NDB) and the Trans-Caledon Tunnel Authority (TCTA) have officially inked a Loan Agreement to facilitate the execution of Phase II of the Lesotho Highlands Water Project (LHWP). Within this agreement, the NDB has committed to extending a project loan amounting to ZAR 3.2 billion to the TCTA, with the sovereign guarantee of South Africa supporting the arrangement.
The Loan Agreement, signed on the sidelines of the 15th BRICS Summit in Johannesburg, witnessed the signatures of Mr. Vladimir Kazbekov, NDB's Vice President and Chief Operating Officer, and Mr. Percy Sechemane, Chief Executive Officer of TCTA. Representing Mr. Sechemane, Mr. Nhlanhla Nkabinde, Executive Manager for Project Finance & Treasury, also joined the momentous occasion.
The TCTA, a state-owned entity tasked with financing and implementing large-scale raw water infrastructure projects, will allocate the received funds toward the construction of the Polihali Dam and reservoir, a 38-kilometer water transfer tunnel, vital road and bridge networks, telecommunications infrastructure, and comprehensive developmental utilities in Lesotho.
By enhancing the yield of the Vaal River Basin by nearly 15% in the long term, the LHWP Phase II is set to not only bolster economic growth but also foster sustainable livelihoods for Gauteng's populace. Gauteng, a highly urbanized province with 15 million residents (accounting for a quarter of the nation's population), contributes a substantial 36% to South Africa's GDP. Furthermore, the positive impacts of this venture will extend directly to the North-West, Mpumalanga, and Free State provinces, all benefiting from the increased water supply that the project will deliver.
The collaborative endeavor will see the co-financing efforts of the NDB, African Development Bank (AfDB), and other financiers.
“This is the first project financed by NDB outside of BRICS countries and it supports South Africa’s commitment to ensure the availability and sustainable management of water, as promoted by Sustainable Development Goal (SDG) 6,” commented Vladimir Kazbekov, NDB VP & COO. “This project exemplifies NDB’s dedication to supporting projects that promote access to clean water, while prioritising sustainable management of water resources.”
Nhlanhla Nkabinde, TCTA's Executive Manager for Project Finance & Treasury, added: "This pivotal partnership between the NDB and TCTA represents more than just the provision of water – it is an emblem of our shared commitment to sustainable progress and the empowerment of our communities. The Lesotho Highlands Water Project Phase II is not merely an infrastructure development; it’s a testament to what can be achieved when nations unite with a vision for a brighter and more sustainable future. The very essence of this project is to breathe life into our economy, and most importantly, ensure that every citizen who is impacted by the Vaal River System, which the project augments, has access to life’s most vital resource. As we embark on this transformative journey, we remain ever grateful to our partners and stakeholders for their unwavering support and trust. Together, we are sowing the seeds for a legacy of abundance, prosperity and resilience for generations to come.”
