The South African government has set aside ZAR827-billion for infrastructure over the next three years, writes Vicky Sidler.

This is according to Garth Strachan, Deputy Director General for Industrial Development and Policy Development at the South African Department of Trade and Industry (DTI), who was speaking at the Bauma Africa 2013 opening ceremony.

“The pipeline of infrastructure projects falling under Minister Patel and the Presidential Infrastructure Coordinating Committee projects up to 2030 has, thus far, been proposed as ZAR4,3-trillion for national and cross-border infrastructure development in 18 strategic projects, on which the DTI is working with other departments in a very concentrated way to go ahead,” says Strachan.

Strachan adds that a complicated set of factors has to be put in place to support the development of upstream and downstream economic activity and linkages and to move the region away from export resource dependence.

This should include, in the opinion of government, support from small- and medium-enterprise development and BEE in communities adjacent to the mines as well as further afield, to reach the desired transformation.

“In South Africa alone, the mining sector procurement amounts to somewhere close to R200-billion a year,” Strachan notes. “Africa is sitting on the wave of a very large infrastructure program. This is important because infrastructure development is not only an enabler of competitiveness, trade and economic growth, but it is a stimulant to economic growth in many different ways.”

Infrastructure development is therefore critical to both resource extraction and a new, inclusive and developmental growth path: “The African Development Bank estimates that sub-Saharan African infrastructure spending stands, in the last financial year, at USD$45-billion per annum, and will continue to increase steadily. It is obvious, therefore, that apart from procurement by mining companies, there are enormous opportunities, which are in the pipeline and all around us from infrastructure expansion.”

Strachan explained that government in South Africa must work closely with the private sector to maximize this opportunity, in order to encourage inward investment into manufacturing in the sector and deploy a set of policy measures to support existing companies as they upgrade competitiveness, innovation, research and development, new products and systems development, technology acquisition, and of course transformation and BEE, amongst others.

The inaugural Bauma Africa, international trade fair for construction machinery, building material machines, mining machines and construction vehicles, kicked off on Wednesday 18 September and will continue until Saturday 21 September.

Strachan, on behalf of Government, thanked and commended the organizers, individuals and companies involved in organizing the event, calling it “…very impressive. We are very pleased that there are both international and national companies and exhibitors here, including those from China, Korea, Africa, Europe and elsewhere.”

He explained that the DTI was honoured to be associated with such a premier event: “We are also very pleased that South African companies, including those that are globally competitive in the space, are exhibiting and are present; including the fact that industry associations are represented here.”

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