Pretoria: The Republic of South Africa, through the National Treasury, has called for eligible market participants to submit proposals that will raise a minimum amount of US$ 500 million for the country’s foreign currency borrowing programme. This initiative aims to supplement South Africa’s foreign currency borrowing programme for the 2025/26 fiscal year by exploring innovative and cost-effective financing mechanisms.

According to South African Government News Agency, proposals should raise, on a stand-alone or combined basis, a minimum amount of US$ 500 million. If funding is offered in another hard currency, the counterparty must commit to swapping the proceeds into US dollars at closing. This funding initiative aims to diversify the sovereign’s hard currency funding toolkit beyond a traditional Eurobond, reduce execution risk, minimize the all-in cost of funds, and maintain flexibility for future liability management actions aligned with evolving market conditions.

The government is expecting responses from primary dealers in South African government securities, internationally active arranging banks, multilateral institutions, institutional investors, and other regulated financial entities with the capacity to fund at scale, either directly or through an arranging bank. Treasury will consider a range of instruments, including bilateral term loans, private placements of floating rate notes, repurchase agreements against sovereign collateral, cross-currency or total return swaps with funding legs in US dollars, and other structured note formats. Proposals incorporating environmental, social, and governance (ESG) or sustainability-linked features are encouraged, particularly if aligned with the National Treasury’s ESG framework.

Proposals will be assessed on the basis of overall cost of funds (spread over the Secured Overnight Financing Rate (SOFR) or equivalent benchmark), speed and certainty of execution, compatibility with the sovereign’s maturity profile and debt service peaks, operational simplicity, and resilience to market shocks, including currency volatility and rate spikes. Interested parties have been advised to submit a PDF term sheet, including proposed amount, tenor, pricing and indicative spread, settlement date, key covenants or conditions precedent, collateral requirements (if any), governing law and documentation platform, and any relevant ESG characteristics.

The deadline for the submission of proposals is Wednesday, 6 August 2025, at 12:00 South African Standard Time (SAST). The evaluation window will start on Thursday, 7 August 2025, and end on Friday, 29 August 2025. This request contains no material, non-public information and may be shared with public-side desks. All proposals and follow-up discussions will be treated confidentially and will comply with all applicable South African public finance regulations.