(Bloomberg) -- The New Development Bank, founded by the BRICS group of developing countries, approved a loan of as much as $1 billion to help develop water and sanitation infrastructure in South Africa.
The funding will be provided under South Africa’s Municipal Infrastructure Grant program, which seeks to reduce infrastructure backlogs and ensure the provision of basic services to poor households, the multilateral lender said in a statement on Saturday.
The funding was announced at the NDB’s annual general meeting in Cape Town. The lender was started in 2015 by BRICS members Brazil, Russia, India, China and South Africa, while the United Arab Emirates, Egypt, Bangladesh and Uruguay are also members.
The bank decided to authorize Algeria’s admission as a member, Dilma Rousseff, its president, told reporters after the meeting. She said while the bank’s policy was to expand its membership among countries of the Global South and that many of them had applied to join, she wasn’t authorized to name them, and an assessment of their eligibility needed to be undertaken before approval was granted.
The UAE, Egypt, Iran and Ethiopia joined BRICS on Jan. 1, but the latter two countries have yet to join the NDB. Saudi Arabia was also announced as a new member of the economic bloc, though the kingdom later said it was still studying the invitation to join.
While the NDB aims to focus on financing long-term projects, it also wants to be accessible to private companies with shorter-term financing needs, Rousseff said. The bank aims to grant 30% of its loans in the currencies used by its members, but has yet to reach that target, she added.
The NDB also agreed to:
- Provide a $150 million-equivalent loan in renminbi to China’s Bank of Communications Financial Leasing Co. for an liquefied national gas transportation project, according to its statement. The loan will be used by BCFL to acquire at least three LNG carriers, and help it address a significant increase in demand for gas in China, it said.
- Approved a revised policy on processing sovereign loans and loans with sovereign guarantees. The amendments will “bring new efficiencies to the project approval cycle,” it said.
- Approved a club loan facility of up to $1.5 billion, without providing further details.
(Updates with comments from bank’s president starting in fourth paragraph.)
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