South Africa’s infrastructure needs far exceed the country’s available fiscal resources. This is according to Andries Nel Deputy Minister of Cooperative Governance and Traditional Affairs.

Addressing the BRICS Friendship Cities, Local Government Cooperation and Urbanisation forum recently the minister said the South African Financial and Fiscal Commission (FFC) estimated that an additional R4 billion per sector would be required yearly for five years in the case of water and sanitation, and for just under seven years in the case of electricity to get infrastructure to suitable standards.

Nel said that just the energy, waste, water and sanitation networks are typically responsible for nearly 50% of city budgets in South Africa.

“Research shows that whilst capital requirement for water services (and water resources) will decrease with water demand management, approximately R97 billion is still required to rehabilitate existing assets,” the Deputy Minister said.

Sustainable growth

He said infrastructure development is integral to overcoming poverty and inequality, as well as building environmental sustainability and urban resilience, particularly in the light of rapidly risen urbanization rates.

Physical infrastructure is a critical enabler of faster, inclusive and sustainable economic growth.

President Cyril Ramaphosa has embarked on a drive targeting $100 billion dollars in investment over the next five years. South Africa will host an investment conference in September to further advance this goal.