EU to Invest $5 Billion in South Africa After US Aid Cut

The bulk of the funds will be directed towards supporting South Africa’s shift to sustainable energy sources, including wind, solar, and hydrogen power production. Additionally, significant investments will be made in local vaccine manufacturing to strengthen the country's healthcare infrastructure.

“South Africa is committed to safeguarding the health of its citizens, and we in Europe have a shared interest in diversifying vital global supply chains. This partnership is based on mutual benefit,” von der Leyen said.

The announcement came at the EU-South Africa summit in Cape Town, the first of its kind in seven years, underscoring the growing ties between the EU and South Africa, which stands as the continent's most advanced economy.

Strengthening Ties Amid Global Uncertainty

The summit, which took place against the backdrop of increasing global instability, was an opportunity for both parties to strengthen their economic and political relationship. South African President Cyril Ramaphosa addressed the challenges posed by rising global unilateralism and economic nationalism, echoing concerns over the impact of U.S. foreign policy under President Donald Trump.

The U.S. decision to slash nearly all aid to South Africa has raised alarms over the future of critical funding, particularly for ongoing efforts to combat HIV/AIDS. With this in mind, Ramaphosa stressed the importance of maintaining strong international partnerships.

“The shifting dynamics in the world only reinforce our resolve to remain united in addressing the pressing challenges we face,” Ramaphosa said. “Some countries focus on exploiting resources for profit elsewhere, but this is not the path we want to follow.”

EU's Commitment to Sustainable Development

Von der Leyen further emphasized the EU’s approach to development, highlighting the bloc’s focus on creating local jobs, fostering added value, and maintaining high environmental and labor standards.

"We are committed to working together in a way that benefits South Africa’s people and economy, not just extracting raw materials, but investing in sustainable growth and long-term prosperity," von der Leyen concluded.

The $5 billion investment marks a new chapter in EU-South Africa relations and signals Europe's intent to play a more active role in supporting the continent’s transition to a greener and more self-sustaining economy.