Infrastructure needs investors: Zuma
19 October 2012
The government will require the support of investors to realise the speedy implementation of South Africa's proposed mega infrastructure programme, President Jacob Zuma said on Friday.
Zuma was speaking at the Presidential Infrastructure Investment Conference in Johannesburg, where a memorandum of understanding to take the infrastructure roll-out plan forward was signed between different ministers and potential investors.
Zuma told the gathering that infrastructure development was a catalyst to sustainable economic development, job creation and poverty alleviation.
The infrastructure plan, announced by the government in February, is expected to guide the construction of new infrastructure while speeding up current projects that support economic growth.
18 strategic integrated projects
It proposes 18 strategic integrated projects (SIPs) covering more than 150 specific infrastructure interventions, ranging across rail, road, ports, dams, irrigation systems, sanitation and energy.
Some of the projects are already commissioned. They include the Dube Trade Port in Durban as well as the expansion of the Port of Ngqura in the Eastern Cape.
Zuma said the summit was about the crucial role of partnerships on infrastructure development in the present and future South Africa.
He urged investors to take advantage of and support the plan. The costs of the 18 strategic projects are estimated at about R4-trillion over the next 15 years. The government is expected to contribute R844-billion of the R1.3-trillion needed for the projects over the next three years
Private sector support needed
Deputy President Kgalema Motlanthe, also addressing the conference, said the government, with the support of the private sector, wanted to make the plans a reality.
"We need their support for the projects included in the plan to be a success. The projects cannot be financed solely through domestic savings ... we need the support of other development institutions, banks as well as other partners," Motlanthe said.
Economic Development Minister Ebrahim Patel told reporters on Friday that the government was committed to mobilising public funds to speed up the progamme, but pointed out that the private sector would have to play its role.
"Construction needs money, it needs minds ... so there has to be co-investment; we have to ensure there is coordination between private sector investment and public sector investment."
Patel said the infrastructure programme would provide long-term opportunities for both the state and the private sector.
"Investors clearly do want to be part of these opportunities, and so if you look at the long-term demand, including commodity demand over the next 15 to 20 years ... what government is doing now in the short term will help create a conducive environment for investment in the long term."
Crucial jobs driver
The country's New Growth Path sets a target of five-million new jobs by 2020, and the government believes that infrastructure development will be a crucial jobs driver.
Zuma said the parties had been identified to be part of the conference because they were "crucial stakeholders with whom government can forge a partnership to enhance the implementation of the country's long-term infrastructure plan".
Zuma said the government had paid special attention to the lessons learnt from building infrastructure for the 2010 Fifa World Cup. That experience should be used to build new infrastructure crucial to the economic development of the country.
"We all have proud recollections of how we managed to build stadiums, roads and refurbished airports ahead of the World Cup. We must use that project management experience to change our country's landscape and improve living conditions while growing the economy."
This would include prioritising skills development, public and private investment as well as creating the right environment for economic growth.