South African President Cyril Ramaphosa revealed that his infrastructure construction program aimed at improving the country’s economic performance has attracted a record over $13.3 billion in investments.
According to Bloomberg, the new National Construction Program for the current fiscal year—which began on April 1st—includes about 250 projects, of which the government will prioritize seven, across various sectors including energy, roads, and water.
“Infrastructure is the engine our economy needs to drive growth and create jobs. If it is well built and maintained, it encourages investors to view our country as an excellent investment destination,” said the president during an infrastructure summit in Cape Town. Ramaphosa spoke as the country approaches the first anniversary of the coalition government formed by ten parties. The alliance, initiated by the African National Congress (ANC) after losing its parliamentary majority in the May elections last year, has made infrastructure the cornerstone of its efforts to revive economic growth, which has averaged below 1% per year for over a decade.
The National Treasury has allocated $57.3 billion for public infrastructure over the next three years, hoping to attract private sector involvement.
Years of underinvestment and mismanagement have left Africa’s most industrialized economy with a significant infrastructure backlog. Ramaphosa previously estimated that the country will need $89.6 billion in public sector infrastructure investment and around $180 billion from the private sector to meet its infrastructure goals by 2030.
However, Deputy Finance Minister Ashor Sarupen emphasized on Monday (26) that attracting private investment has been challenging, as the government’s public-private partnership (PPP) program is too “complicated” and investors remain wary of corruption and governance issues.
“We are not attracting funding fast enough. The infrastructure gap is very large and growing. And if you consider that investment relative to GDP is only 15%, that’s far too low to achieve a sustainable growth rate,” he stressed.
Source: Diário Económico
