CAPE TOWN CONTAINER TERMINAL
Posted on 06 December 2009 by Railways Africa Editor
Transnet has secured a R2.2 billion “untied” loan from Agence Francaise de Developpement Group (AFD – a development bank owned by the French government) to partly fund the expansion of the container terminal in Cape Town. The parastatal aims to double capacity to 1.4 million TEUs by 2012. This is part of a bigger scheme involving deepening the harbour, refurbishing the berths and replacing container handling equipment at an overall cost of R4.6bn.
The loan is to be rolled out over 15 years and comes with a three-year draw-down period. Transnet acting CEO Chris Wells is quoted saying that the group intends to hedge exposure to the currency risk in a 200m deal. The company, he said, intends entering a currency swap, a form of forward cover exchange rate contract, locking the exchange rate when the rand is still looking strong against the euro. “What makes today’s agreement with AFD particularly attractive to us is that although it is in euros, it can be disbursed to us in rands, a move that will boost our ability to manage our financial risk, particularly foreign exchange risk,” Wells said.
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