Western countries have moved with speed to counter any possible influence of the Russian government in South Africa’s Just Energy Transition Programme (JETP) on the heels of Russia’s foreign affairs minister’s visit.
This comes as US Treasury Secretary Janet Yellen and a delegation of the European Union (EU) met with South Africa’s government ministers to discuss the JETP yesterday.
Yellen held bilateral talks with Finance Minister Enoch Godongwana and Energy and Mineral Resources Minister Gwede Mantashe early in the day, before speaking with President Cyril Ramaphosa in a closed meeting and visiting a US-owned Ford car plant in Pretoria.
South Africa is the first country in the world with a Just Energy Transition Partnership which aims to wean it off fossil fuels and encourage investment into renewable energy, thus achieving net-zero carbon emissions reduction by 2050.
The US, alongside a number of European countries, committed $8.5 billion (R145.7bn) to fund the project through a variety of concessional grants and loans, but this has raised concerns about the fairness and South Africa’s debt burden, as less than 3% of the money is earmarked as grants.
The South African delegation at the World Economic Forum last week acknowledged that addressing the electricity shortage in the country was the first and most important step to unlocking faster economic growth, creating jobs, and attracting investment.
Speaking at the National Treasury yesterday at the end of her African tour of four countries, Yellen said she was going to discuss South Africa’s economic outlook and energy sector reforms.
“This partnership represents South Africa’s bold first step towards expanding electricity access and reliability and creating a low-carbon and climate-resilient economy, a move that I believe will alleviate the deep fiscal strain the energy sector is putting on South Africa’s economy and support strong economic growth,” Yellen said.
“The partnership will also invest in the jobs of growing industries so that the transition is just and does not leave anyone behind.”
Mantashe, who has been characterised as a stumbling block to fast-tracking renewable energy due to his preference of coal-energy generation made his position on the JETP known to Yellen.
“We agree to a transition from high-to-low carbon emissions,” Mantashe said.
“Our policy is that of mixed-energy technologies to address energy poverty while transitioning to a low-carbon economy. Our JETP must be people-centred,” he said.
South Africa upset the powerful nations last week when it hosted Russia’s foreign affairs minister Sergey Lavrov who spoke about strengthening the BRICS partnership amid the controversial joint naval drills with Russia and China off the coast of KwaZulu-Natal next month.
Russia has previously nearly entered into agreements with South Africa to develop it 9.6GW nuclear reactors to secure the country’s energy supply.
But this was a topic that Yellen steered away from, even opting to not have a question-and-answer session with the media to avoid getting into discussing it.
The bilateral talks between Yellen and Godongwana also touched on a number of issues, including on anti-money laundering and countering the financing of terrorism, climate financing and the sovereign debt resolution in Africa.
Godongwana said Yellen was one of the leading US government leaders who was advancing the US administration’s initiative to bolster trade, economic and financial relations with South Africa, and the African continent.
“I am equally pleased by the announcement that you made yesterday, that the US Treasury and South Africa’s National Treasury are committing to form a joint task force on combating the financing of wildlife trafficking,” Godongwana said.
“I believe that Ms Yellen and I will have fruitful discussions today on a number of issues, including anti-money laundering and countering financing of terrorism, climate financing, and sovereign debt resolution in Africa.”
Meanwhile, a high-level EU delegation led by EU foreign minister Josep Borrell was also in the country yesterday to discuss the just and green recovery for South Africa.
BUSINESS REPORT