Infrastructure development in South Africa’s metropolitan municipalities has been given a major boost with the Asian Infrastructure Investment Bank’s (AIIB) maiden investment in South Africa.

The AIIB reports that the sovereign-backed loan, worth US$500 million, will go towards the South Africa Metro Trading Services programme to help improve the financial sustainability, accountability and operational performance of municipal services while supporting low-carbon, climate-resilient urban development in the country.

It is part of a broader US$3 billion World Bank co-financed project to strengthen governance, operational efficiency and financial management while incentivising climate-smart investments in essential urban services. The funding to the municipalities is contingent on their meeting performance standards.

‘South Africa’s metropolitan municipalities are central to the country’s economic development and climate transition,’ says Rajat Misra, AIIB’s director-general of public-sector clients (Region 1). ‘By strengthening municipal governance and improving the performance of essential urban services, the programme will enhance infrastructure delivery while supporting South Africa’s climate and development objectives.’

The  goal of the programme is to enable all eight participating metropolitan municipalities by 2031 to meet their minimum performance conditions, reduce non-revenue (unpaid, reticulated) water from 41% to 28% and lower electricity losses from 22% to 12%, delivering more efficient, reliable and sustainable municipal services.

11 August 2026
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