German development cooperation with South Africa

22.09.2023 - Article

The development partnership between Germany and South Africa is aimed at helping the country overcome the development challenges that persist, especially in the areas of good governance, energy, health, vocational education, and prevention of violence.

South Africa calls itself the Rainbow Nation, in reference to its ethnic and cultural diversity. Until the end of the apartheid regime in 1994, South Africa had been shunned by the international community for a long time due to its systematic racist repression of the majority population. The impacts of that period can still be felt today.

South African flag
South African flag© dpa

South Africa has since developed into a stable democracy. The constitution it adopted in 1997 is very progressive. It contains, among other things, a comprehensive catalogue of human rights. The country has a free media and an active civil society.

The World Bank classifies South Africa as an upper-middle-income country. Yet the country is currently ranked just 109th out of 191 countries on the United Nations Human Development Index (HDI).

Covid-19 pandemic

So far, no country in Africa has been hit as hard by the COVID-19 crisis as South Africa. A very strict lockdown that was imposed to contain this infectious disease caused massive social and economic impacts. Unemployment rose to about 35 per cent, and economic growth fell by more than six per cent in 2020. In the quarters that followed, the economy saw a short recovery, until growth decreased again when the Omicron variant hit.

German development cooperation with South Africa

The development partnership between Germany and South Africa is aimed at helping the country overcome the development challenges that persist, especially in the areas of good governance, energy, health, vocational education, and prevention of violence. The other aim of the two countries' cooperation is to support global climate action efforts and strengthen South Africa's important role in democracy, peace and stability on the African continent.

At government negotiations between the German Federal Ministry for Economic Cooperation and Development (BMZ) and the South African government in October 2022, pledges were made for bilateral development cooperation totalling 355 million euros over two years. 320 million euros alone will go to supporting a socially just energy transition in South Africa, 270 million euros of which will be in the form of low-interest loans and 50 million euros in the form of grants.

Further grants amounting to 35 million euros support South Africa in vocational training projects, in the fight against corruption, in the prevention of violence, and in vaccine production and logistics.

South African-German development cooperation focuses on the following core areas:

1) Climate and energy, just transition

Area of intervention: renewable energy and energy efficiency

Expert next to a solar panel
Expert next to a solar panel© Robert Kituyi

South Africa is in an energy crisis: The power supply has to be switched off for up to twelve hours a day. In the meantime, a national state of emergency has even been declared. The energy infrastructure is dilapidated - a consequence of decades of lack of investment as well as criminal activities. The crisis has serious consequences for the people and for economic development. Germany supports the partner country in implementing a socially just energy transition.

Currently, South Africa generates almost 80 per cent of its electricity by burning coal, making it one of the world's largest producers of greenhouse gases. The South African government has set itself ambitious climate targets. To achieve this, the use of renewable energy sources must be greatly expanded, and energy efficiency significantly increased. South Africa has a very high potential for generating electricity from wind and solar energy. However, the government has made it clear that South Africa can only achieve the transformation of its energy sector and its climate goals with the help of the international community.

Establishment of the Partnership for a Just Energy Transition in South Africa:

Therefore, at the international climate conference (COP26) in Glasgow in 2021, Germany, Great Britain, the USA, France and the EU announced that they would jointly support South Africa in implementing a socially just energy transition (Just Energy Transition Partnership, JETP). Since June 2023 Denmark and the Netherlands also joined the International Partners Group (IPG).

The international partners have made a total of 8.5 billion US dollars available for this purpose, mostly in the form of loans. Germany is contributing more than 1.1 billion euros to this, including around one billion euros from BMZ funds.

Examples of German involvement:

With the involvement of the private sector, the German Development Cooperation (GIZ) advises the South African Department of Energy, the state-owned energy supplier, districts and municipalities on behalf of the BMZ on promoting the use of renewable energies and improving energy efficiency. Support is provided for the construction of energy infrastructure, advisory services in the electricity market, training opportunities for “green” jobs and social cushioning measures.

Within the framework of Financial Cooperation, low-interest loans are granted through South African institutions to small and medium-sized enterprises that want to invest in renewable energies and improved energy efficiency. In addition, German Development Bank (KfW), promotes the modernization of the transmission and distribution grid on behalf of the BMZ to be able to feed the energy generated from renewable sources into the electricity grid.

2) Peaceful and inclusive societies

Area of intervention: good governance and prevention of violence

Good governance is an important prerequisite for sustainable development. In South Africa, however, skills shortages and inefficiencies hamper governance and administration - not only at the national level, but also in the provinces and districts.

German development cooperation therefore supports South Africa in building an efficient administration that is equally available to all citizens and provides the population with basic public services in a reliable and transparent manner. Advice is provided, for example, in the areas of human resources and financial management, citizen participation, combating corruption and cooperation with the private sector.

Violence prevention in municipalities:

The BMZ also supports measures to prevent violence in the municipalities. This includes improving the social and economic infrastructure (safe footpaths, public squares, sports fields, civic and youth centres). It also promotes the exchange of knowledge and experience between government agencies and civil society organizations and the involvement of young people. Through training programmes and social media, they are empowered to actively contribute to violence prevention in their neighbourhood.

3) Sustainable economic development, training and employment

Area of intervention: Technical and vocational education and training; labour market

More than half of South African youth under 25 are unemployed. At the same time, companies cannot fill vacancies because there are not enough qualified workers.

The level of education at public vocational training institutions is low despite high education spending by the state, and teachers are poorly trained or not trained at all. Systematic cooperation between companies and state technical vocational education and training institutions (TVET colleges) is underdeveloped.

Support the dual training pilot project:

Germany supports a pilot project for dual training in South Africa: At five TVET colleges and together with 70 training companies, dual-structured apprenticeship training for electricians and for water and wastewater installation specialists is being tested. Practical training phases in companies are combined with block teaching at the TVET college. Training content and examination procedures at the college were developed with the participation of companies and professional associations. The aim is for the participating companies to offer the trained young people permanent employment afterwards.

Through the establishment of training centres and the development of training curricula, the training of vocational school teachers is also improved with funds from financial.

Improve social infrastructure:

In order to make the planned coal phase-out in South Africa socially acceptable, investments in social infrastructure are also planned. The more than 90,000 mine workers in particular are to benefit from this. In addition, vocational training opportunities for young people and professional opportunities for women will be improved and small and medium-sized enterprises will be promoted. Future innovation locations, for example for green hydrogen and electric vehicles, will also be supported.

Qualifying skilled workers for “green” technologies:

The planned energy transition will significantly increase the demand for skilled workers in “green” industrial sectors. To meet this demand, the German Development Cooperation (GIZ) is cooperating with the South African Departments of Higher Education and Skills Development (DHET) and Science and Innovation (DSI). Practice-oriented qualification measures are being developed in model projects; together with the private sector, work is being done on improved technology transfer. One example is the introduction of the subject “Renewable Energy Technologies”, which has been offered at nine educational institutions since 2016.

4) Cooperation outside the core areas: Health
Area of intervention: vaccine production

To achieve a more equitable global distribution of vaccines against Covid-19, Germany supports the international vaccine alliance COVAX. In addition, the German government is promoting the expansion of global production capacities, with a focus on South Africa, Ghana and Senegal. So far, only a very small proportion of the vaccines used in Africa have been produced there.

researchers© picture-alliance/dpa

With a package of 50 million euros, the BMZ is supporting the efforts of South African partners to establish their own vaccine production: Funding is being provided for measures to improve vaccine logistics and cold chain management, as well as to strengthen regulatory and certification organisations.

Through training and education measures as well as research funding, South Africa is to be put in a position to develop further vaccines.

In addition, the German Investment and Development Company (DEG) is participating with other donors in financing for the South African company Aspen, which has been producing Johnson and Johnson's vector vaccine under licence since April 2021. This will allow production to increase from 300 million doses per year to 600 million doses per year.

Regional and multilateral

On top of its bilateral engagement Germany channels significant resources for development cooperation through the European Union, the World Bank, the African Development Bank, the Global Fund for HIV/AIDS, Tuberculosis and Malaria and other multilateral institutions such as the UN system, also benefiting South Africa. Germany is also supporting South Africa in its objective to strengthen regional organizations like the African Union (AU) and the Southern African Development Community (SADC).

German partners

German development policy is planned and commissioned by the German Ministry for Economic Cooperation and Development (BMZ). Other German Ministries also provide official development assistance to the country. The German Embassy is responsible for liaising with the South African Government and coordinating all activities with other development partners. German financial cooperation is implemented by German Development Bank (KfW), technical cooperation by the German Development Cooperation (GIZ). Both KfW and GIZ have local offices in South Africa. Private Sector development is also supported by the German Investment and Development Company (DEG).

Micro projects

The German Embassy provides micro funds to local projects that help to reduce poverty and improve living standards. These projects include shelters for vulnerable children, construction, or renovation of school classrooms, etc. Civil society organizations can be applied here:

Micro projects funded by the German Missions in South Africa, Lesotho and Eswatini

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