Understanding the critical role of infrastructure as an engine for fuelling economic growth , infrastructure investment has formed a central pillar of China ’ s economic strategy for decades . Between 2002 and 2016 , the Chinese government tripled its infrastructure investment as a share of GDP from 8 % to almost 24 % - during which time the country experienced an average annual real GDP growth of 9.6 %.
By contrast , the Infrastructure Consortium of Africa ( ICA ) estimates that poor and ageing road , rail and harbour infrastructure in African countries generally may currently be adding as much as 30-40 % to the cost of goods traded across the continent . This is placing an undue burden on consumers and businesses , and strangling growth .
So , by continuing its diligent efforts to lift the various logistics constraints facing the country , as well as to roll out world-class national infrastructure to support the needs of South Africa ’ s expanding population , government can achieve the 5 % growth target needed to stimulate job creation and eliminate poverty and unemployment .
As a result , South Africans should be comforted that government has allocated R8.47 billion to Public Works and Infrastructure in the 2023 / 24 year as evidence of its commitment , as outlined in the Medium-Term Budget Policy Statement ( MTBPS ). Furthermore , an additional R1.18 billion was allocated this year for reconstructing and rehabilitating municipal infrastructure damaged by disastrous floods in KwaZulu-Natal , Eastern Cape , Limpopo and Mpumalanga .
The role of the private sector Critically , however , infrastructure development and the task of reaching the 5 % growth target cannot and should not be the responsibility of government alone . There is no denying that South Africa has suffered a difficult few years , as the aftereffects of the pandemic , geopolitical shocks , and what the International Monetary Fund has described as a “ limping ” world economy have weighed heavily upon our own economy and the fiscus .
So , as government faces the enormous challenge of balancing the many urgent demands on its limited budget , the private sector must engage to seek where it can be of service in investing in vital infrastructure projects . Quality infrastructure acts to boost investment confidence in countries , which in turn attracts further investment in areas such as infrastructure . So , by leading the way in supporting infrastructure projects in South Africa , local investors can spark a virtuous economic cycle that benefits all .
Developers , too , have a role to play in nation-building by ensuring that infrastructure is delivered at a high standard , on time , and within budget . In many cases in the past , private companies have played a role in causing wastage and cost overruns in major projects . In response , the entire industry must make every effort to improve governance , transparency , and accountability in public infrastructure projects .
As the Gap Infrastructure Corporation ( GIC ), for example , we are proud to be leading the way through finalising a fully digital cutting-edge project management programme that will provide real-time dashboards for monitoring projects ’ progress . This will not only provide internal teams with greater insights and a holistic view of ongoing work but will also benefit government partners and other clients and stakeholders .
By embracing this type of innovative solution , GIC hopes to bolster confidence , attract infrastructure investment , improve living and working conditions for local communities , and support the public sector in positively changing lives .
Many governments across Africa have increased their infrastructure spending , and the Africa Finance Corporation has even described Africa as on the precipice of a 30-year infrastructure boom . As the continent ’ s most industrialised nation , it is encouraging to see South Africa ’ s public sector and private developers at the forefront of this shift , working in tandem to address the formidable infrastructure and service delivery challenges in our path and unlock economic growth to enhance the welfare of our communities .
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