The European Union has pledged a $12.5 billion investment in South Africa’s sustainable energy, transport, and health sectors, marking a significant milestone in the country’s transition to clean energy. According to European Commission President Ursula von der Leyen, the investment will play a crucial role in supporting South Africa’s ambitions to become a global leader in clean energy.
“We can now take almost €12-billion to our Just Energy Transition Partnership,” Von der Leyen said, highlighting the EU’s commitment to supporting South Africa’s green transformation. The investment will be deployed through blended financing, combining public and private sector resources to develop facilities for critical mineral processing and green hydrogen production.
About $9.5 billion of the total investment will be allocated towards green hydrogen and critical mineral processing facilities, while the remaining funds will support projects aimed at climate resilience, modern transport networks, and vaccine manufacturing capacity. This initiative positions South Africa as a key player in the global energy transition and underscores the EU’s growing interest in long-term African supply chains and local production ecosystems.
The investment is part of the EU’s Global Gateway strategy, which aims to mobilize up to €300 billion in investments globally, with a significant portion directed towards Africa. The strategy reflects the EU’s shift from aid to a strategic partnership with Africa, focusing on green transitions, digital infrastructure, healthcare, and resilient supply chains.
“This is more than investment, it’s collaboration for mutual growth. Africa’s green transformation is vital for the world’s sustainable future,” an EU official noted, emphasizing the importance of the partnership.
The Coega Green Ammonia Project, a flagship initiative, will benefit from the investment, supporting local production to meet growing domestic and global demand for green ammonia in agriculture, chemicals, and mining. This project is expected to create over 20,000 direct and indirect jobs and contribute to South Africa’s goal of becoming a global shipping hub for clean maritime fuel.
The EU’s investment package also includes support for strengthening local biomanufacturing capabilities for vaccines and other pharmaceuticals, enhancing South Africa’s capacity to produce essential health products for the African continent .