Pretoria has expressed confidence that selecting Gazprombank as an investor will not trigger Western sanctions
South African national oil company PetroSA has chosen Russia’s Gazprombank as its preferred investment partner to revive a gas-to-liquid (GTL) fuel refinery in the southern town of Mossel Bay, despite the threat of Western sanctions.
The move, announced on Monday, has been approved by South Africa’s cabinet, according to officials. A final investment decision is expected in April of next year.
The US and its Western allies have imposed sanctions on Gazprombank, Russia’s third-largest lender by assets and a key channel of Moscow’s energy trade, in response to the Ukraine conflict.
A member of the BRICS group alongside Russia, South Africa has insisted on a non-aligned stance and has resisted external pressure to distance itself from Moscow. That includes calls from the US, where a group of lawmakers has demanded that Pretoria be removed from the African Growth and Opportunity Act (AGOA). South Africa currently has beneficiary status under the program, which allows eligible Sub-Saharan African countries duty-free exports to the American market.
Khumbudzo Ntshavheni, a minister in the South African presidency, told reporters in Pretoria on Monday that the country’s relations with Russia are driven by partnerships within the BRICS group.
“We are aware there are countries that are not happy with our participation in the BRICS. There is no point in South Africa being in BRICS and not wanting to partner with BRICS countries in trade and investment,” Ntshavheni said.
“It is part of us making sure we can build a resilient economy that is not only susceptible to one side of the global balance of powers,” she added.