Chamwe Kaira
The national treasury of South Africa has introduced a new infrastructure and development finance bond.
The announcement follows the statement made by finance minister Enoch Godongwana during the 2025 medium term budget policy Statement.
The bond is designed to raise funds to finance or refinance projects under the government’s budget facility for infrastructure.
Absa Bank Limited and Tysys Capital Group will act as co-arrangers for the transaction.
The issuance will take place under the domestic multi-term note programme.
Two senior unsecured instruments will be offered: RI2036, with a 10.3-year tenor and maturity date of 31 March 2036, and RI2041, with a 15.3-year tenor and maturity date of 31 March 2041.
The target issue size is N$15 billion. Both instruments will pay fixed, semi-annual coupons, with the final price guidance still to be confirmed.
“The auction will be conducted via a Dutch auction with no feedback. Bids must be submitted between 09h00 and 11h00 on the auction date, Monday, 8 December 2025. Successful bids will clear at one yield, and bids below the final clearing yield will receive full allocation. Bids from the arranging bank will only be accepted between 09h00 and 09h30. Allocation for successful bids will be pro rata,” the national treasury said.
Godongwana said the bond supports the government’s goal of shifting spending toward investment.
“In line with this vision and advancing the government’s pillar of growth-enhancing infrastructure, we are shifting the composition of spending from consumption to investment. Capital payments are the fastest-growing expenditure item at 7.5% over the medium term,” he said.
He said the government is using public resources to mobilise private finance and expertise to strengthen service delivery, improve spending effectiveness and support economic growth.
Drawing on lessons from the Renewable Energy IPP project, he said the department of transport’s private-sector participation unit is working to revive the passenger transport and logistics sector.
“Following strong interest from the freight logistics requests for information, the unit will issue the first rail corridor request for proposal by December 2025, with others following in early 2026. The unit has also issued requests for information for investment opportunities in modernising and growing the passenger rail system.”
Funding of N$4.1 billion has also been allocated for disaster relief to repair schools, pipelines, clinics and substations damaged by flooding in KwaZulu-Natal, Mpumalanga and the Eastern Cape.
Godongwana said the bond supports the government’s plan to introduce financing tools that can raise cheaper funding for infrastructure. The government will also contribute N$2 billion to capitalise the credit guarantee vehicle.
“The new Infrastructure Finance and Implementation Support Agency will be operational by March 2026. The Agency will provide project preparation support to supply the BFI pipeline. It will centralise infrastructure finance functions to systematically crowd in private capital and promote the use of alternative delivery mechanisms,” he said.
He said the government is also piloting a utility reform programme to stabilise and professionalise water and electricity businesses in selected municipalities in Mpumalanga.
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Enoch Godongwana
