South Africa’s water security has mainly been reliant on surface (fresh) water and its development
Andries Rossouw, PwC’s assurance partner highlighted the economic challenges that contributed to the difficulties faced in the construction industry.
“The tough economic conditions in 2016 did not spare the construction industry, with lower revenue, decreased spend on projects, and a long term industry settlement,” he said.
Deloitte Africa Construction Trends Report also showed that in Southern Africa the number of big-scale water projects dropped from 109 last year to 85. This is representative of almost 30% of all large projects on the continent.
In the last three years the number of large projects in southern Africa has declined, with its current project value sitting at US$ 93.4 billion, compared to US$ 140 billion last year.
South Africa had the highest number of projects (41), followed by Nigeria with 38 projects.
Some of the projects by South African companies included Stefanutti Stocks’ completion of two clay core, earth-filled embankment dams – the Abba Dam and the Katonga Dam, early in 2016. South Africa’s Wilson Bayly Holmes-Ovcon (WBHO) has also cemented its name in dam construction with several projects across Africa.
Deloitte associate director for corporate finance, JP Labuschagne said that infrastructure needs in the water sector remained largely unaddressed.
Overuse of water, inadequate water infrastructure and poor water management were identified by the World Economic Forum as some of the major risks associated with the country’s current water crisis.
Not enough water infrastructure projects in Africa
Labuschagne said that despite the “huge need for investment in water infrastructure”, big water projects were still few and far between in Africa. The water sector saw only 11 (3.8%) projects in 2016, with a total value of US$4.3 billion.
South Africa has three of the 11 projects. These included the Mokolo and Crocodile Water Augmentation Project worth US$ 1.1 billion, the Western Aqueduct Project Phase II worth US$ 0.15 billion, and the Brits Water Treatment Works worth US$ 0.03 billion.
Labuschagne said it was regrettable that there was not a “great push to improve water infrastructure”, as this was the case with energy projects on the continent.
He added that while smaller projects were happening at municipal level, this was insufficient. “The drought might put some focus on the need for infrastructure and more people are talking about it,” he said.
