President Cyril Ramaphosa, delivering his state of the nation address earlier this month, placed a significant emphasis on developing innovative ways of funding infrastructure, saying the Government will spend more than R940 billion on infrastructure over the next three years including R375 billion in spending by state owned companies.
While many government initiatives may not necessarily be visible to the public, this is not the case with infrastructure projects that have stagnated in recent years, from water and electricity to ICT, logistics and transport, the country for decades has not put up the infrastructure to match the aspirations and basic needs of its citizenry.
There were great strides made post 1994 in the delivery of infrastructure to address the imbalances of the past but these have largely dried up, with ambitious projects stalling and leading to massive cost overruns.
Ramaphosa told the country that the government was engaging with local and international financial institutions and investors to unlock R 100 billion in infrastructure financing and a project preparation bid window had been launched to fast track investment readiness.
“This funding will revitalise our roads and bridges, build dams and waterways, modernise our ports and airports and power our economy.
“Through the Infrastructure Fund, twelve blended finance projects worth nearly R38 billion have been approved in the last year. These are projects in water and sanitation, student accommodation, transport, health and energy,” Ramaphosa said.
Global South countries understand that a transformative future requires resilient, sustainable infrastructure with innovative funding solutions, including public-private partnerships and cross-border investments, essential to close the financing gap.
India’s infrastructure boom is viewed as a quintessential example of how addressing the infrastructure needs of the country’s more than 1.4 billion population can assist in turning a country from one that is developing to a model of development.
The country’s Minister of Railways, Ashwini Vaishna, speaking on the sidelines of the World Economic Forum 2025 in Davos, listed out the four pillars of the strategy charted out by the central government to become a developed country.
These pillars are physical, digital and social Infrastructure, (ii) Inclusive development, manufacturing, and the focus on simplification of laws and processes.”
"Today the entire world is very excited about India's growth journey. People here wanted to understand Prime Minister Narendra Modi's economic thinking. So that was very clearly explained.
“The fourth pillar structure which Prime Minister Modi has created for economic growth - investment in social, physical, and digital infrastructure. The second pillar is a good focus on manufacturing and innovation. Third is inclusive growth. And fourth is simplification," he said.
This structured approach, he said, has improved confidence in India’s ability to grow at a very steady and healthy pace with moderate inflation.
This confidence prompted investment enabling state governments to engage in successful MOUs with global companies, he said.
“The success that we are seeing today is not a coincidence. This is the result of a clear, well thought out strategy, meticulously executed - a very clear strategy in the four pillars on infrastructure development,” Vaishna said.
Ramaphosa used his State of the Nation Address to highlight a burning issue in the country - the state of its municipal infrastructure - an issue that needs to be resolved for economic growth and stability to become a reality.
“In many cities and towns across the country, roads are not maintained, water and electricity supply is often disrupted, refuse is not collected and sewage runs in the streets….many municipalities have not reinvested the revenue they earn from these services into the upkeep of infrastructure.”
He said that the government will work with municipalities to establish professionally managed, ring-fenced utilities for water and electricity services to ensure that there is adequate investment and maintenance.
If there is a clear strategy in place, then South Africa can join others in the Global South who are using infrastructure growth to boost their economies.
* Dr Govender is an academic and a keen observer of issues related to international relations.
** The views expressed do not necessarily reflect the views of IOL or Independent Media.