Editor Danielle Petterson
EDITOR’S COMMENT
danielle.petterson@3smedia.co.za Managing editor Alastair Currie Head of design Beren Bauermeister Chief sub-editor Tristan Snijders Contributors Akintunde Akinsete, Chandre Barnard, Lester Goldman, Derek Hazelton, Ashton Busani Mpofu, Dan Naidoo, Andries Nel, Rivonia Pillay, Peter van der Merwe Operations & production manager Antois-Leigh Botma Production coordinator Jacqueline Modise Distribution manager Nomsa Masina Distribution coordinator Asha Pursotham
Commercialise the sector
C
Group sales manager Chilomia Van Wijk Financial manager Andrew Lobban Bookkeeper Tonya Hebenton Printers Novus Print Paarl Advertising sales Hanlie Fintelman t +27 (0)11 467 6223 | c +27 (0)82 338 2266 Hanlie.Fintelman@3smedia.co.za
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ISSN: 1990 - 8857 Annual subscription: R330 (SA rate) subs@3smedia.co.za Copyright 2020. All rights reserved. All articles herein are
copyright protected and may not be reproduced either in whole or in part without the prior written permission of the publishers. The views of contributors do not necessarily reflect those of the Water Institute of Southern Africa or the publishers.
WISA’s Vision
Inspiring passion for water
WISA Contacts: HEAD OFFICE Tel: 086 111 9472(WISA) Fax: +27 (0)11 315 1258 Physical address: 1st Floor, Building 5, Constantia Park, 546 16th Road, Randjiespark Ext 7, Midrand Website: www.wisa.org.za BRANCHES Central Branch (Free State, Northern Cape, North West) Chairperson: Dr Leana Esterhuizen Company: Central University of Technology Tel: +27 (0)51 507 3850 Email: lesterhu@cut.ac.za Eastern Cape: Branch Contact: Dan Abrahams Company: Aurecon Tel: +27 (0)41 503 3929 Cell: +27 (0) 81 289 1624 Email: Dan.Abraham@aurecongroup.com Gauteng Branch Lead: Zoe Gebhardt Cell: +27 (0)82 3580876 Email: zoe.gebhardt@gmail.com KwaZulu-Natal Chairperson: Lindelani Sibiya Company: Umgeni Water Cell: +27 (0)82 928 1081 Email: lindelani.sibiya@umgeni.co.za Limpopo Chairperson: Mpho Chokolo Company: Lepelle Northern Water Cell: +27 (0)72 310 7576 Email: mphoc@lepelle.co.za Mpumalanga Chairperson: Lihle Mbatha (Acting) Company: Inkomati-Usuthu Catchment Management Agency Tel: +27 (0)13 753 9000 Email: mbathat@iucma.co.za
ovid-19 has highlighted some of the deficiencies in our water sector. It has also reduced the funds available to address some of our long-term problems. Now, more than ever, it is critical that the private sector becomes more involved. We’ve all read the reports that the Department of Water and Sanitation is essentially bankrupt. Moreover, municipalities are facing severe financial strain due to non-payment as a result of the economic decline brought on by Covid-19 and the resultant lockdown. Without urgent private sector investment, our water infrastructure may face a grim fate. I recently had a conversation with Benoît Le Roy, CEO of the South African Water Chamber, in which he highlighted the need to commercialise the water sector. Importantly, this does not mean privatising the water sector. It simply means attracting private funding and reducing the burden on municipalities by allowing private companies to manage, operate and maintain our water infrastructure under contract. Le Roy believes that foreign investors are now more concerned about water than energy in South Africa – largely because renewables offer a tangible solution to the energy crisis and work is being done in this regard. Without a reliable and cost-effective water supply, we cannot industrialise and attract investment.
Attracting investment One way to attract and ring-fence private sector funding is through special-purpose vehicles (SPVs). SPVs are legal entities created for a specific purpose, such as a funding structure to raise capital.
Danielle
Promoting professional excellence in the water sector The official magazine of the Water Institute of Southern Africa
Water& Sanitation Complete water resource and wastewater management
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MINE WATER A water-driven approach
Western Cape Chairperson: Natasia van Binsbergen Company: AL Abbott & Associates Tel: +27 (0)21 448 6340 Cell: +27 (0)83 326 3887 Email: natasia@alabbott.co.za Namibia Please contact the WISA Head Office on admin@wisa.org.za for more information
This approach has been embraced by government. The Development Bank of Southern Africa has spent a lot of time developing the SPV model but it has yet to be widely implemented. Le Roy sees SPVs as a mechanism to mitigate contracting uncertainty. This, together with policy and regulatory certainty, is crucial to attract private investment. South Africa’s highly complex water sector involves a great deal of red tape, discouraging the private sector that has repeatedly expressed a willingness to work with government. It is now up to government to create a regulatory environment that inspires rather than averts private involvement, and government needs to embrace this approach from within. However, the private sector must continue to lobby for this. The declining institutional capacity without our government entities means that this future will be harder to achieve without constant pressure. The water sector can be operated like a business, and the private sector is better at managing businesses because it is incentive driven. We should embrace this and use it to drive improvement in the sector. The world may be in the midst of a health and economic crisis, but South Africa’s water and sanitation infrastructure is also in crisis. We cannot afford to wait. We need solutions and we need them now.
COVER OPPORTUNITY In each issue, Water&Sanitation Africa offers companies the opportunity to get to the front of the line by placing a company, product or service on the front cover of the magazine. Buying this position will afford the advertiser the cover story and maximum exposure. For more
NON-REVENUE WATER Financing projects post Covid-19
WATER SECURITY Lessons in resilience
SANITATION
Industrialising next-gen technologies
information, contact Hanlie Fintelman on +27 (0)11 467 6223, or email Hanlie.Fintelman@3smedia.co.za
July/August 2020 • ISSN 1990-8857 • R55.00 (incl. VAT) • Vol. 15 No. 04
J ULY / A U G U S T 2020
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