Announcement of Twenty Million Dollars Loan for Electric Power in South Africa on July 29, 1966

• I 1818 H STREET, N.W., WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 Bank Press Release No. 66/41 Subject: $20 million loan for electric July 29, 1966 power in South Africa The World Bank has approved a loan equivalent' to $20 million to the South African Electricity Supply Connnission (ESCOM). The loan will assist in financing the foreign exchange costs of a 1,600,000-kilowatt thennal power plant at Camden, about 160 miles east of Johannesburg. The project is part of ESCOM's $785 million expansion program,·under which the Commission plans to add 3,310,000 kilowatts of generat::ing capacity and 3,200 miles of high-voltage transmission lines to its system during 1966-1970 • • try. ESCOM is an autonomous statutory corporation established in 1922. tions are divided into seven undertakings which serve different parts of the coun- ESCOM supplies electricity in bulk to most cities in South Africa for dis- Its opera- tribution in their areas, and supplies power directly to mines, large industries and the railroads. Its abili~y to meet the rapidly rising demand for power has been an important fa.ctor in the economic development of South Africa during the postwar period. Between 1945 and 1965, ESCOM's installed capacity increased more than fivefold, to a total of about 4,600,000 kilowatts,>, It now generates about 80% of the electricity used in the country. ESCOM's sales of electricity have .,. increased at an average rate of 8.2% per year for the past decade, and are ex~ pected to increase at about the same rate during the next five years. At present about four-fifths of the Commission's power sales are in the inter- • connected system which comprises thti1 Cape Northern, Rand and Orange Free State and (I  - 2 - Eastern Trans~aal undertaking' and serves the principal industrial ·and mining areas of South Africa. The new Camden power plant will be in this system. It is already under construction and is being built on a new coal fi~ld w~th.reserves adequate to supply the station for 40 years at low cost. The plant will have eight 200,000- kilowatt generating units~ the first of which is scheduled for completion in October 1966. The other units are scheduled to follow at intervals of three to eight months with the final unit expected to be in operation by October 1969. The estimated total cost of the Camden project is equivalent to $176.4 million. of which $40.6 million will be in foreign exchange. The Bank loan will cover about half the foreign,exchange requirements. Most of the remaining costs will be met by ESCOM from internal cash generation and from borrowings in the South African capital market. Contracts for the major items of equipment for the Camden station have been placed on the basis of international competitive bidding. The loan will be for a term of ten years and bear interest at the rate of ,, • 6-1/4% per annum. Amortization will begin on June 1, 1968. The loan will be guaranteed by the Republic of South Africa. •