South Africa Signs $400M Loan With BRICS Bank to Fix Highways
On 22 July 2025 in Johannesburg, the South African National Roads Agency (SANRAL) contracted a loan agreement for ZAR 7 billion ($398M) with the New Development Bank (NDB) — also known as the BRICS Bank — to finance its highway upgrade program. The loan is subject to vetting by the State Law Adviser who has to review the loan agreement from a legal perspective, and the process is expected to take two weeks.
After that, the South African Reserve Bank will have to approve the foreign-exchange rate for the loan amount. The financing is considered a concessional loan over a period of 20 years and a grace period of 5 years, during which time only interest is due. Then, for the next 15 years, repayment of the capital will proceed to term. In the future, both lender and borrower are considering rand-denominated funding to avoid the foreign exchange complications.
The loan from NDB is intended to partially fund the improvement of national highways N1 and N3, amongst other projects. The total cost is estimated at ZAR 12.7 billion, while the loan from NDB will cover ZAR 7 billion. For additional capital, SANRAL plans to engage domestic banks, Development Finance Institutions (DFI), and issue bonds.
It is worth recalling that the discussion for the loan with NDB started back in 2019, but SANRAL failed to secure a sovereign guarantee. At the time, the National Treasury raised concerns over historic debt linked to the road toll system. Then, in 2024, the Government of South Africa took over the toll debt and raise the debt ceiling for SANRAL to about USD one billion, paving the way for fresh financing.