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INDUSTRY MATTERS
Rethinking the value
of infrastructure in SA
The National Development Plan (NDP) notes that to
“achieve sustainable and inclusive growth by 2030,
South Africa needs to invest in a strong network of
economic infrastructure”.
By Mathieu du Plooy, managing director of WSP Africa
Mathieu du Plooy,
managing director
of WSP Africa.
As we are a little more than a decade away from the
targets set for 2030, now is the time to take stock
of investments to date, and current and planned
infrastructure projects. clear government policy and leadership — in order to
feel confident about investing. The market is eagerly
awaiting clarity on some key policy issues and the new
guard’s turnaround strategies for the SOEs.
The need for infrastructure investment and development
has not gone away. In fact, it is more apparent than
ever — built projects are levers which should be used
to drive growth within the economy. I believe this is still
possible, even in the country’s current economic climate,
and that South Africa still offers immense opportunity for
investment and infrastructure development. REGIONAL INTEGRATION TO DELIVER
ON OPPORTUNITIES AND PROJECTS
In my view, we are not leveraging on regionally integrated
opportunities within the southern Africa or SADC region
to stimulate mutually beneficial opportunities and growth
as well as we could be.
What we need, however, is a change in focus to leverage
on opportunities that will show immediate economic
contributions in the short term, without compromising
their adaptability to incorporate new technologies. In
this way, we could effectively future-proof the country’s
infrastructure networks and ensure an attainable long-
term vision of sustainable and inclusive growth.
BUILDING CONFIDENCE IN THE ‘NEW GUARD’
Despite wide-felt market optimism, there seems to
remain some reservations within the private sector on
how the country will fair under the new leadership of
President Cyril Ramaphosa.
There are several influencing factors causing the private
sector to be ‘a bit shy to invest, right now’. Political and
environmental uncertainty reduced planned expenditure
by government on large-scale infrastructure projects, and
the stretched balance sheets of state-owned enterprises
(SOEs) — which also continue to come under public
scrutiny — are all contributors.
That being said, there are investors keen to develop and
get involved in projects across the country. Overall, the
private sector needs stability — which will come from
August 2018 Volume 24 I Number 6
If we look just within the power industry, for example,
there is a huge concentration of investment in power
projects in South Africa to grow the country’s power
outputs. Therefore, within the SADC region, focus could
be placed on developing trade corridors and investing in
building transmission and distribution lines to transport
the power — rather than each country looking to invest
in power infrastructure development independently.
Some progress towards this is being achieved by the
Southern African Power Pool (SAPP), which is currently
driving a number of transmission interconnector projects.
These projects link or strengthen power interconnections
between various countries in the SADC region, with
the intention to create a large power pool that will offer
countries with a power deficit the facility to import power,
and those with excess power the options for exporting
their surplus energy.
Similarly, regional cooperation and collaboration can play
an enormous role in developing a robust gas-to-power
industry that currently does not exist in southern Africa.
For instance, as Mozambique sits on the precipice of
major infrastructure projects around its gas fields —
from gas-to-power stations, transmission and distribution
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