Citigroup Inc. is teaming up with South Africa’s Gauteng provincial administration to fund almost R1.4 billion of investment in a new mega-city project and airport south of Johannesburg.
The US lender, through its South African unit, will make a seven-year loan facility available to a special purpose vehicle that will directly invest in infrastructure for the Mega River City on the banks of the Vaal river, Citi South Africa head Peter Taylor said.
The development could attract much as R30 billion in additional investmenthe said.
“The new Vaal river city project will take the form of a public-private-partnership,” Taylor said in an interview. “It will constitute a mixed-use metropolitan city development, an international airport, along with logistics, manufacturing and agricultural hubs.”
Gauteng, South Africa’s richest province, has identified five corridors or sites where it wants to boost economic development and create jobs, with the new city the first of the envisioned projects.
It will span at least 1,200 hectares of land, and adjoin an industrial hub where steel-maker ArcelorMittal SA and petrochemical giant Sasol Ltd. have processing facilities.
The Vaal River City project was first revealed in 2015boasting an estimated development cost of between R7 billion and R11 billion.
At the time, the mixed-use development was punted as “South Africa’s first post-apartheid city” and was planned to house 400,000 square metres of commercial office space; 60,000 square metres of retail and leisure component; 20 hectares of park areas – including a bird sanctuary; and 5,000 residential units.
While updates on the project have been scarce, work has been done on infrastructure around the site, including the construction of a major interchange, called the Vaal River City Interchange, in 2022.
Addressing an imbizo in Sedibeng in August 2022, President Cyril Ramaphosa said the project was part of a special economic zone in the region which would support new industries.
“The Vaal River City. We’ve had this wonderful resource for years – the river – if you look at other countries, they always have their cities around the river,” the president said.
“We’ve had our main city, Johannesburg, around gold mines. With our mining sector having really run out of ore, I’m glad that the Gauteng government is raising their eyes beyond the horizon. They’re coming up with an ambitious plan – create a city around the Vaal River as part of the special economic zone that is going to be set up here.”
The president said that the special economic zone will support a skilled workforce and will enable producers of goods and services to connect suppliers to markets and support new local industries.
The concept images below are what was envisioned for the project back when it was announced.
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