Objectives

The primary objective is to assess available market solutions, financial instruments, and advisory services that can enhance the bankability of the City of Cape Town’s infrastructure projects. The initiative aims to reduce the cost of capital, improve creditworthiness, attract private sector participation, extend debt tenors, and ultimately support long-term service delivery, economic growth, and climate resilience.

Scope

This Request for Information (RFI) covers market research into financing and risk mitigation mechanisms across multiple infrastructure sectors, including water, sanitation, energy, transport, waste management, digital infrastructure, and climate resilience programmes. The scope encompasses:

• Credit enhancement tools and risk mitigation instruments that reduce lender or investor risk and improve project viability.
• Blended finance, Public-Private Partnerships (PPPs), Independent Power Producers (IPPs), and other innovative financing structures.
• Advisory and project preparation services to support investment readiness, due diligence, financial modelling, and procurement.
• Integration with municipal budgeting frameworks, national treasury regulations, and existing grant funding.
• Quantified financial impacts, pricing structures, implementation risks, and proven track records in similar environments.

The RFI is voluntary and non-binding. Responses will inform future technical specifications and potential competitive procurement processes. The City reserves the right to request proofs of concept or demonstrations but will not compensate respondents for such activities.

Technical Requirements

Respondents must submit comprehensive, structured information using designated annexure templates, limited to approximately 20 pages including supporting documents. Key technical submissions include:

• Product/Service Overview: Executive summary, operational mechanics, problem addressed, benefits to the City, implementation timeline, and visual illustrations.
• Credit Enhancement & Risk Mitigation: Detailed explanation of how the solution addresses credit, payment, political, performance, and market risks. Must outline security arrangements, reserve accounts, trigger/claim mechanics, and residual risk allocation.
• Quantified Financing Impact: Measurable reductions in weighted average cost of capital, debt tenor extensions, capital mobilisation estimates, all-inclusive pricing, and value-for-money indicators.
• Grant & Funding Integration: Compatibility with municipal and national grants, blended finance opportunities, and interactions with existing debt covenants.
• Advisory & Implementation Support: Capabilities in project screening, due diligence, financial modelling, procurement guidance, and end-to-end implementation frameworks.
• Legal & Regulatory Compliance: Alignment with municipal finance legislation, National Treasury directives, and medium-term budget planning cycles.
• Risk Management: Identification of technical, financial, counterparty, market, and construction risks, alongside mitigation strategies, termination clauses, and business continuity plans.
• Commercial & Reference Data: Transparent pricing models, validity periods, key assumptions, exclusivity terms, and documented case studies with quantifiable outcomes.

Note on Complex Terms: Credit enhancement refers to financial mechanisms (e.g., guarantees, reserve funds, first-loss capital) that improve a project’s credit profile to attract lenders. Bankability denotes the likelihood that a project will secure financing based on its financial viability, risk allocation, and revenue streams. Medium-Term Revenue and Expenditure Framework is the municipal three-year budget planning cycle requiring all new financing to align with approved fiscal parameters.

Skills Requirements

Respondents must demonstrate advanced expertise in municipal and infrastructure finance, including:

• Proven experience structuring and implementing credit enhancement, risk mitigation, and blended finance solutions within public-sector or municipal contexts.
• Deep knowledge of South African regulatory and legislative frameworks, particularly municipal finance management acts, systems legislation, and National Treasury guidelines.
• Strong financial modelling, valuation, and affordability analysis capabilities, with the ability to quantify impacts on financing costs, debt tenor, leverage capacity, and tariff implications.
• Transaction advisory skills covering project preparation, feasibility studies, due diligence, procurement strategy, and contract structuring.
• Experience navigating multi-stakeholder environments, including development finance institutions, commercial banks, insurers, institutional investors, and government departments.
• Ability to design robust governance, monitoring, reporting, and audit frameworks compliant with municipal oversight requirements.
• Track record of delivering measurable social, environmental, or resilience outcomes alongside financial returns.

Submissions must be accurate, non-confidential, and formatted as PDF or Word documents. The City retains full discretion over how submitted information is used and reserves the right to proceed with alternative procurement strategies or discontinue the process entirely.