INFRASTRUCTURE

DID YOU KNOW?

PAVING THE ROAD TO RECOVERY

Just how crucial is infrastructural development to South Africa’s sustained economic recovery? ANÉL LEWIS reports on government’s Sustainable Infrastructure Development System

The Infrastructure Fund creates an opportunity for more partnerships between government and the private sector through the use of blended fi nance. To fast-track these projects, government has committed R100-billion to this fund over the next 10 years. It will support projects in the energy, water, transport, ICT and social sectors.

Source: National Treasury

BREAKING GROUND

De Lille confi rms that the projects are at various stages of implementation. “Timelines for the start of construction are dependent on securing funding and fi nancing for the projects from the fi scus or fi nancial markets. These are ongoing and very positive discussions.” Work has started on some of the projects, including Mooikloof, Green Creek, Joe’s Place, and the Sondela Phase Two (45 per cent in construction) human settlement development projects. Construction on the upgrade of the N3 between the Dardanelles interchange and the Lynnfi eld Park interchange between Cato Ridge and Pietermaritzburg, which will create an estimated FAST FACT 700 job opportunities, is also imminent, she says.

COVID-19 has been devastating for many sectors of the economy, but it has also provided an opportunity to deal with challenges already evident before the pandemic. Billed as a “reset for the South African economy”, the national government’s Economic Reconstruction and Recovery Plan, launched in October 2020, aims to “create an environment supportive for sustained and accelerated economic recovery”.

As such, infrastructure has been identifi ed as a key driver of investment and growth, and Treasury has set out a pipeline of projects that will create jobs and address spatial inequality. These will also be used to transform social planning by integrating communities and making employment opportunities more accessible.

Patricia de Lille The Infrastructure and Investment Offi ce in the Presidency, together with the Department of Public Works and Infrastructure (DPWI), has therefore developed a new method of planning and implementation, known as the Sustainable Infrastructure Development System (SIDS).

Patricia de Lille, By the end of June 2020, Minister of Public 276 projects, with an investment SHOW ME THE MONEY Works and value of R2.3-trillion, formed Government’s vaccine Infrastructure, explains part of the Economic Reconstruction roll-out plan, expected that the methodology and Recovery Plan. The following to cost over applies specifi c month, 50 strategic integrated R20-billion, is admissions criteria that projects and 12 special projects, likely to have little focus on the economic, enabling over R340-billion in new material impact social and strategic investment, were gazetted. on its infrastructure importance of each Source: Department of Public Works and Infrastructure development targets, as project. “Social facilitation fi nancing has been allocated is a key component linked to specifi cally for these projects, the engagement with surrounding says De Lille. “Government has communities where the project is to be committed to a R791.2-billion infrastructure implemented. This identifi es the skills investment drive. We are already partnering and training needed to ensure local with the private sector and other players to roll community members benefi t from the out infrastructure through initiatives, such as infrastructure development.” the blended fi nance through the Infrastructure The DPWI last year opened a skills portal Fund, which was operationalised in where unemployed graduates could register for August 2020.” work opportunities created by the infrastructure Other fi nance models include blended investment plan projects. “We have to fi nancing, public-private partnerships, and recognise that we do have the skills in our build-operate-transfer (BOT) or build-owncountry, we just need to pull them together to operate-transfer (BOOT) for large-scale achieve our infrastructure development goals.” infrastructure projects. Green bonds are also De Lille says the department is also tapping an option for projects that meet the criteria, into the expertise of the private sector. adds De Lille. “The National Treasury has also provided “GOVERNMENT HAS COMMITTED TO A R791.2-BILLION INFRASTRUCTURE INVESTMENT DRIVE. WE ARE ALREADY PARTNERING WITH THE PRIVATE SECTOR AND OTHER PLAYERS TO ROLL OUT INFRASTRUCTURE THROUGH INITIATIVES.” R440-million for project preparation – a key area we need to get right to ensure that projects are de-risked from the start and implemented on time and within budget,” – PATRICIA DE LILLE, MINISTER OF PUBLIC WORKS AND INFRASTRUCTURE concludes De Lille.