Johannesburg - The Airports Company South Africa (ACSA) and the French Development Agency (AFD) on Wednesday signed a long-term ?85 million loan (approx R1 billion) agreement to improve the O.R Tambo International Airport.
According to the agreement between the two parties, the loan will be repayable over fifteen years with a three year grace period.
According to ACSA, the funds will be utilised to finance the extension and upgrading of ACSA's flagship airport, in particular the Central Terminal Building.
Christopher Richard, Regional Director of AFD based in Johannesburg said: "This financial support shows how international development institutions can accompany, even in critical global financial times, development processes that structure the economy."
As part of ACSA's strategy to diversify its sources of funding, it has approached a number of financial institutions, particularly those that focus on long-term infrastructure development.
AFD is the first international development finance institution to support ACSA in funding its capital investment programme.
Priscillah Mabelane, ACSA's Executive Director: Finance said they were pleased that AFD has partnered with them in providing long-term funding with an appropriate structure at a time when the credit market was constrained.
The agreement emphasised the quality of the partnership between France and South Africa in particular for the support of the organisation of the 2010 FIFA World Cup and the long-term development of Africa, she said.
The AFD, operating in South Africa since 1994, is a French government institution set up to provide development financing especially for urban, rural and infrastructural development, as well as industry, financial systems and education.