EU announces South Africa investment after US aid cut
The European Union will invest €4.7 billion (over $5 billion) in South Africa to support various projects, including the clean-energy transition, vaccine manufacturing, and digital and physical connectivity, European Commission President Ursula von der Leyen announced Thursday.
The announcement was made at a summit between the EU and South Africa aimed at strengthening bilateral ties. It comes shortly after the US withdrew financial assistance to Pretoria amid a diplomatic row.
“We spoke together at the G20 in Rio in November about green hydrogen and renewables…To open this new chapter in our relations, Europe can contribute a €4.7 billion Global Gateway investment package,” Von der Leyen told South African President Cyril Ramaphosa.
The bulk of the aid package – €4.4 billion – will be invested in clean and just energy projects, such as expanding wind, solar, and hydrogen power production in the country.
“We know that others are withdrawing. So here, we want to be very clear with our message: We are doubling down with our support. We are here to stay,” the EU chief declared.
Pretoria announced last week that the US had withdrawn from the International Partners Group (IPG), a coalition that includes the EU, the UK, Germany, France, Italy, Canada, Japan, Norway, and Denmark. The IPG seeks to help a number of countries, including South Africa, transition to cleaner energy. According to a statement from President Cyril Ramaphosa’s office, South Africa now stands to lose over $1 billion in investment pledges from Washington following its exit from the group.
Last Friday, US President Donald Trump said his administration would stop all federal funding to South Africa, calling the country a “bad place to be right now.” The decision followed the passage of a controversial land expropriation law that the African country says aims to address racial disparities in land ownership. Trump has slammed the legislation as an “egregious action” and signed an executive order instructing US government agencies to halt aid to the country.
In his speech at the EU-South Africa summit in Cape Town on Thursday, Ramaphosa said the event was happening “at a time of global uncertainty characterized by rising unilateralism, economic nationalism, and a retreat from international law.”
