FEATURE
Infrastructure
development
Banks and the NDP: reality checks
and relevant financing models
Ramaphosa’s address stood out as instructive for several
reasons. First, he placed his finger on a socio-economic problem
that has dogged the South African economy since the birth of the
new republic: the seemingly double-digit rate of unemployment
(23% or higher), even in the face of recorded economic growth.
Second, he acknowledged a universal veracity about SMEs being
he Banking Association South Africa’s annual
affirmed as a source of job creation and economic growth. Third
summit, held in September, focused on how the
and most relevant to the theme of the summit, he pointed to
banking industry can aid realisation of the National
the sore spot of the banking industry’s less than spectacular
Development Plan’s (NDP) aspirations, which can
financial intermediation role1. It is a regular refrain of critics
be summarised as:
• Job creation through services-based SMEs;
of the banking industry to point to banks’ “refusal” to fund the
• Development of public infrastructure;
country’s engine of growth in the face of trillions of investable
• Increased provision of affordable housing; and
rands lying fallow at South African banks. Is this a fair criticism?
• Reduction of poverty and inequality.
This article takes off from this question to: (1) contextualise
Among several salient points of the keynote address by ANC
the issues implicit in the question, (2) map the economic
Deputy President Cyril Ramaphosa, was the clear burden
landscape within which demands are made of banks, and (3)
of expectations which the NDP appears to place on
suggest relatively more appropriate financial arrangements
the banking industry. He specifically fla