The government needs to create a good balance between social infrastructure and economic infrastructure. South Africa’s infrastructure programme will only work if it crowds in private capital.
The government currently has a target of spending R1 trillion of mostly private money over the next decade on infrastructure. Secondly, policy reform to allow for the participation and investment of private capital into (traditionally) state owned infrastructure will drive efficiency through enhanced competition. Much of this should focus on alleviating supply side constraints to exports, such as rail and port infrastructure. The first, while considering the fiscal constraints that the country faces, is directing capital toward key implementable and economically enabling infrastructure programmes that will unlock economic growth and contribute to job creation. This is not a cyclical crisis, but a structural one that has been worsened by stagnant growth. South Africa has suffered a setback from not carrying out the bold reforms that the state-owned sector of our economy so desperately requires. The current challenge involving the Independent Communication Authority of South Africa (ICASA) and telecommunication companies’ over-allocation of spectrum, as well as the delayed auctioning of the wider spectrum, is the latest example of how reforms are stalled by policy inertia. Government will need to demonstrate how it will implement a dramatic reform agenda in South Africa. Structural reform is arguably one of the biggest issues that we face as a country. What is needed is a clear plan and tangible action on some of the most pressing problems facing the country. In addition, the nation will be anxious about a possible fourth wave of the COVID-19 pandemic and any further adjusted lockdown restrictions. JOHANNESBURG, South Africa, 3 November 2021. Finance Minister Enoch Godongwana will deliver his delayed maiden Medium-Term Budget Policy Statement (MTBPS) on 11 November 2021 at a time when the country’s cities and towns are in the process of installing political leadership following the local government elections.
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