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The progress on
infrastructure funding
The Banking Association South Africa is making concrete progress in
developing plans to achieve what was discussed in the 2012 Banking Summit
on infrastructure.
T
he 2012 Banking Summit, which was addressed by
Deputy Finance Minister Nhlanhla Nene, focused on
addressing the need for public and private partnerships
to better fund South Africa’s infrastructure projects.
Last year Nene said South Africa’s R3.2-trillion
infrastructure programme would need funding support from the
private sector.
It was agreed that South Africa’s infrastructure programme could
not be solved by government alone simply out of the national fiscus.
Of the R3.2-trillion earmarked for infrastructure, about R1.9-trillion
has already been allocated for electricity, education and transport.
The Banking Association MD, Cas Coovadia said that his
organisation had worked on a model where banks would offer
project finance expertise on infrastructure along with experts from
the development finance institutions and state-owned enterprises
like Transnet.
Coovadia said government needed to put priority projects on the
table and the financial services sector would come on board. Once the
priority projects had been outlined the financial services sector would
put out how much it was setting aside to fund South Africa’s much
needed infrastructure programme.
The Banking Association, he said, was also participating in
engagements at Business Leadership South Africa (BLSA) with
other private-sector players to speed up work on infrastructure
funding. Coovadia said the broader BLSA initiative was working
on the conceptualisation and implementation of the major
infrastructure projects.
The Banking Association and the Association for Savings and
Investment are also working together on a document that will take
the discussions further. The document, which Coovadia says should
be finalised soon, will stipulate what needs to be done to deliver on
the infrastructure programme. Added to this, the two organisations
are involved in a National Treasury task team on private sector
financing of infrastructure.
The Presidential Infrastructure Coordination Commission and
the government’s investment manager, the Public Investment
Corporation and Finance Trade Union SASBO are also involved in
the process.
‘We are engaging substantively on getting the infrastructure
programme implemented,’ Coovadia reported in September to the
The Banking Association Managing Director Cas Coovadia,
Deputy Minister of Finance Nhlanhla Nene and FirstRand CEO
Chairman Sizwe Nxasana at th