South Africa, Nigeria, Egypt need to meet 69%

The Star Early Edition - - BUSINESS REPORT - Ka­belo Khu­malo

SOUTH Africa, to­gether with Nigeria and Egypt, were fore­cast to meet 69 per­cent of their in­fra­struc­ture needs by 2040, but South Africa would still need to spend 2.4 per­cent of its gross do­mes­tic prod­uct (GDP) a year to meet these needs in the next 13 years.

This is ac­cord­ing to the Global In­fra­struc­ture Out­look re­port re­leased yes­ter­day and con­ducted by the G20-backed Global In­fra­struc­ture Hub and Ox­ford Eco­nom­ics.

The re­port in­cluded a study of 50 coun­tries across the world and seven in­dus­try sec­tors. The re­sults found that African coun­tries had to spend $174 bil­lion (R2.26 tril­lion) col­lec­tively per year un­til 2040 if the con­ti­nent was to meet its in­fra­struc­ture needs un­der the UN Sus­tain­able De­vel­op­ment Goals (SDG).

“The in­fra­struc­ture in­vest­ment fore­casts for South Africa, Egypt, and Nigeria ap­pear the most af­ford­able out of the African coun­tries in our sam­ple, and amount to no more than 3.2 per­cent of GDP in the cur­rent trends sce­nario, or no more than 4.9 per­cent of GDP un­der the in­vest­ment needs sce­nario” the re­port said. If African economies wanted their per­for­mance to match that of their best per­form­ing peers, the to­tal in­fra­struc­ture in­vest­ment would need to be $240bn per an­num over the next 23 years.

Most African coun­tries had very large in­fra­struc­ture needs, rel­a­tive to the size of their economies and faced sig­nif­i­cant in­vest­ment gaps, but that South Africa, Morocco, Ethiopia and Egypt, had each con­trib­uted be­tween 6 per­cent and 11 per­cent of Africa’s in­fra­struc­ture in­vest­ment since 2007.

To achieve the SDGs by 2030, South Africa needs to com­mit an ad­di­tional $23bn in the wa­ter and elec­tric­ity sec­tors, tak­ing the to­tal to $464bn by 2040.

The re­port fur­ther found that South Africa would need to spend 0.5 per­cent of its GDP on wa­ter and san­i­ta­tion in­fra­struc­ture to meet the SGD re­quire­ments.

South Africa’s Trea­sury, in this fi­nan­cial year’s bud­get com­mit­ted to spend more than R50bn to fund na­tional and pro­vin­cial eco­nomic in­fra­struc­ture re­quire­ments.

The In­fra­struc­ture De­vel­op­ment Act No 23 of 2014 was signed into law by the Pres­i­dent Ja­cob Zuma. The Act, which fa­cil­i­tates and co-or­di­nates pub­lic in­fra­struc­ture de­vel­op­ment, also es­tab­lished co-or­di­na­tion struc­tures of the Pres­i­den­tial In­fra­struc­ture Co-or­di­nat­ing Com­mis­sion (Picc).

The Picc en­sures that all three spheres of gov­ern­ment are part of the Picc and that all the main ex­ec­u­tive au­thor­i­ties across the pub­lic sec­tor meet on a reg­u­lar ba­sis to drive the im­ple­men­ta­tion of in­fra­struc­ture de­vel­op­ment plans.

A World Bank re­port re­leased ear­lier this year found that only 35 per­cent of sub-Sa­ha­ran Africa’s pop­u­la­tion had ac­cess to elec­tric­ity, with ru­ral ac­cess rates less than onethird of ur­ban ones. Trans­port in­fra­struc­ture is like­wise lag­ging, with sub-Sa­ha­ran Africa be­ing the only re­gion in the world where road den­sity has de­clined over the past 20 years. How­ever, ac­cess to safe wa­ter has in­creased, from 51 per­cent of the pop­u­la­tion in 1990 to 77 per­cent in 2015.


Part of the N2/Um­geni Road in­ter­change has fi­nally been com­pleted and open to traf­fic. In­fra­struc­ture in­vest­ment fore­casts for South Africa would re­quire 2.4% of GDP for the next 13 years.

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