Infrastructure will be the linchpin of SA’s economic reconstruction and recovery plan, aimed at helping SA come back from the devastation wrought by the Covid-19 pandemic, President Cyril Ramaphosa told a joint sitting of parliament on Thursday.
The “huge” build programme is aimed at unlocking more than R1-trillion in infrastructure investment over the next four years, and will be one leg in the broader package that the state hopes will raise growth to about 3% on average over the coming decade.
“Infrastructure has immense potential for stimulate investment and growth, to develop other economic sectors and create sustainable employment both directly and indirectly,” Ramaphosa said in his address.
Fixed investment — an important factor in boosting job creation — has been hit hard by the Covid-19 crisis as business confidence has deteriorated and firms have had to shore up their finances amid plummeting economic activity and declining demand.
But the establishment of the recently announced Infrastructure Fund, housed in the Development Bank of Southern Africa (DBSA), and Infrastructure SA, led by Kgosientsho Ramokgopa, will ensure the active implementation of the build programme, said Ramaphosa.
The state’s renewed efforts were already encouraging private investors to help build capability for infrastructure delivery within the state and to develop blended financing models, Ramaphosa said.
With R100bn in seed funding from the Infrastructure Fund over the next decade, the state aims to unlock R1-trillion in new investment from the private sector for strategic projects.
The state had already gazetted a list of 50 strategic integrated projects and 12 special projects in July 2020, with several projects including 18 housing projects to the value of R130bn, already under construction.
However, within the next six months, more projects would come on stream including the expansion of the national rural and municipal road rehabilitation and maintenance programme, using labour intensive methods, the president said.
The state will also fast track the implementation of gazetted projects through steps such as the speedy processing of water-use licences and environmental impact assessments and the approval of credit enhancing instruments.
The state will also adapt the infrastructure procurement framework to enable public-private partnerships and unlock new funding, Ramaphosa said.
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