In spite of South Africa’s construction sector being one of the country’s slowest-growing sectors of the last decade, economic consultancy Econometrix chief director and economist Dr Azar Jammine remains optimistic that, following the National Budget Speech earlier this week, the South African government has reiterated its commitment to investing in infrastructure spend.

The announcement of the Economic Recovery and Reconstruction Plan in 2020 included 51 projects, worth R340-billion. This subsequently increased to include an additional 55 well-defined projects, worth R595-billion at the time the Medium-Term Budget Policy Statement was published in November 2021.

Taking this into account, Jammine tells Engineering News that “if only a small fraction of these projects see the light of day, it will still have an enormous impact in boosting overall capital investment and improving the delivery of services in South Africa”.

To put it into perspective, he explains that even if only R5-billion of the cumulative R935-billion pipeline materialises, it is equivalent to 126% of yearly total fixed investment in the country which, if spread out across ten years, will amount to a 12.5% increase in capital investment.

In turn, this would boost economic growth by 2% a year and result in the creation of thousands of new jobs.

Jammine comments, however, that “one can only hope” that the projects materialise, as it has the potential to be “the most important and relevant” game changer in the South African economy.

Former South African Finance Minister Trevor Manuel, meanwhile, suggests that one should be more cautious when considering the lead time for these projects, as most of the planned infrastructure projects would require the acquisition of land for service and require adequate planning.

“It’s frequently impossible to do this with a lead time that’s shorter than three years before equipment is on site. And the worrying thing is that [South Africa] tends to follow the announcements, which come before the three-year lead time,” he tells Engineering News, stressing that discussions need to be held to “shorten the timeframe” on these projects.

“I think we underspend on all kinds of infrastructure, roads and bridges and even our energy infrastructure. When we do spend, we overspend, and no country can spend on that basis. We need to build into the efficiencies of spending and ensure that it’s not just infrastructure spend, but that it’s efficient infrastructure spend, which creates employment and provides economic outputs in the present,” Manuel elaborates.

AfriSam sales and marketing director Richard Tomes, meanwhile, says the gaps in infrastructure across the nation are also largely affected by the country’s skills shortage.

“Things aren’t looking positive, and it’s largely because of the lack of actual infrastructure spend that has caused large [construction] companies to find themselves where they are,” he comments.

However, Jammine comments that the relationship between the private sector and the government in terms of cooperating to implement such infrastructure projects, has improved.

“I believe the government itself has experienced a change in the last year or so in terms of wanting to embrace the private sector more actively to assist in implementing projects.

“The government has come to recognise that it itself is not capable of carrying through with these projects on its own, and it was one of the most the most forceful aspects of the State of the Nation Address of President [Cyril] Ramaphosa when he said that it's the private sector that creates jobs, not the government,” Jammine explains.

He suggests that what the private sector must now do is “to try and engage government more actively” because, theoretically, the private sector should receive a far better reception than has been the case in the past.

“With its superior skills, [the private sector] should be able to actually ensure more work for itself and more success in actu...