Finance minister Enoch Godongwana has to be commended for proactively managing <a href="https://usglobalxpress.com/20-billion-us-fintech-circle-backs-south-african-payments-firm-operating-in-30-african-markets/" title="$20 billion US fintech Circle backs South African payments firm operating in 30 African markets”>South Africans’ expectations about the continued headwinds facing the economy
During his speech on the medium-term budget policy statement last Wednesday, he announced alower growth forecast for the year. Simultaneously, he pinned his hope on the continued implementation of reforms and infrastructure investment as pathways to economic growth
As was shown in yesterday’s presentation by Business Leadership South Africa, the big business lobby group, considerable progress is being made in the implementation of the economic reforms to free up the economy to grow faster
Still, thesereforms, evident in ending load-shedding, restructuring Eskom and stabilising the freight logistics system, have yet to translate into higher growth and new jobs. Which is understandable given that all reforms take time to be felt
For years, President Cyril Ramaphosa has been promising to turn the country into a major construction site as part of the government’s R1-trillion infrastructure investment programme
Big numbers. Little progress. And the country is not a construction site
There is no shortage of projects — new and old
Public infrastructure — roads, bridges and water systems — are collapsing thanks to lack of maintenance. New social and economic infrastructure is needed to support economic growth amid a rapidly growing population
Current infrastructure investment is largely driven by the private sector, with the public sector playing a limited role. Even private-sector investment is concentrated less on productive infrastructure and more on retail, commercial and residential developments
The private sector can only invest in private infrastructure projects. The state, however, has a monopoly on the provision of bulk infrastructure such as water, electricity and sanitation
Mike Nkuna, the property magnate and a significant shareholder in Kaizer Chiefs Football Club, often complains about how hard it is to undertake major commercial projects because of the state’s tardiness in laying out the requisite bulk infrastructure
In part this explains the rise of private sector-led infrastructure development projects
The daily public service delivery protests taking place across the country are a testament to the backlog and neglect of crucial public infrastructure
Potholes get fixed but can’t stand the next rains
New bridges soon get washed away by the next wave of rains
Mega state-led projects are notorious for cost and schedule overruns. Eskom and Transnet are textbook examples of how not to execute major infrastructure projects
Transnet’s multipurpose pipeline ran over budget and took years to complete. Kusile and Medupi, Eskom’s power stations, are sad cases in point of cost and schedule overruns
There is no doubt that infrastructure development — as in fixing old ones and building new assets — is a known engine of catalysing economies in terms of jobs and growth. However, this can only be realised in an environment where such an undertaking is feasible
The South African state is sorely lacking as far as capacity is concerned. Ramaphosa recognises this reality. So does the private sector
Unfortunately, the government is led by statistics
In his speech, Godongwana announced a raft of measures to accelerate the implementation of the ambitious infrastructure programme
Most of what he proposed are new institutions. These are noble proposals. Sadly, though, these will take years to set up and have an impact
In these pages, Sean Phillips, director-general at water affairs, wrote eloquently about the disabling public procurement system
Godongwana should read that opinion piece and accept the private sector’s helping hand to turn South Africa into a construction site