JOHANNESBURG, South Africa – The European Union has announced a massive €11.5 billion ($13.3 billion) investment package for South Africa, targeting clean energy, infrastructure, and pharmaceutical manufacturing projects in a bid to accelerate the country’s economic and industrial transformation.
According to a statement released late Thursday, a significant portion of the investment will be directed toward expanding South Africa’s renewable energy capacity, modernizing its national power grid, enhancing energy storage systems, and supporting the development of green hydrogen.
Africa’s most industrialized economy has struggled with sluggish growth, high unemployment, and a lingering power crisis that has undermined investor confidence. The EU funding aims to bolster South Africa’s efforts to transition toward sustainable growth and reduce its dependence on coal.
Among the flagship initiatives highlighted is the Coega Green Ammonia Project, a strategic development designed to meet rising global demand for green ammonia used in agriculture, chemical manufacturing, and mining. The investment will also strengthen South Africa’s capacity to produce vaccines and other pharmaceuticals for distribution across the African continent.
European Commission President Ursula von der Leyen had previously pledged €4.7 billion during a visit to South Africa in March. It remains unclear whether the new €11.5 billion commitment includes that earlier pledge or comes in addition to it.
The announcement comes as South Africa grapples with new U.S. tariffs of 30% imposed by President Donald Trump in August, which have dampened its export prospects. The recent expiry of a major U.S.-Africa trade initiative last month has compounded the pressure on the country’s export-dependent sectors.
South African trade officials are currently engaging with Washington in efforts to negotiate a reduction of the tariffs, which they warn could further strain key industries and jobs.
With the EU now stepping up as a major investment partner, analysts say the funding could provide a critical boost to South Africa’s renewable energy ambitions and industrial self-reliance — while deepening Europe’s strategic footprint in the continent’s energy transition.
($1 = €0.8643)
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