Johannesburg: SA's proposed R3,2-trillion infrastructure drive is predicated on building infrastructure links across Africa. "SA is committed to the development of Africa — this is evident in our foreign policy," Energy Minister Dipuo Peters told delegates at this week's Infrastructure Africa Business Forum in Johannesburg.
But President Jacob Zuma, who is heading the Presidential Infrastructure Champion Initiative on behalf of the African Union, as well as championing domestic infrastructure build, will have his work cut out aligning policy and regulation with cost-effective and relevant projects in energy, transport, water, agriculture, information communications technology, health and education.
SA has outlined 17 strategic investment projects in infrastructure made up of hundreds of sub-components in various stages of planning. While many will likely not come about, the idea is to engender economic access across the country, enhancing competitiveness.
However, as many observers warn, infrastructure is an economic enabler rather than an end in itself. This means potential projects in SA and across the continent will have to be vetted, funded, approved and implemented in a coherent and sustainable way.
Along with Mr Zuma's role in the Presidential Infrastructure Championship Initiative on behalf of the African Union and SA's own Presidential Infrastructure Co-ordinating Commission, the New Partnership for Africa's Development oversees the Programme for Infrastructure Development in Africa, bringing together the public sector, private sector and various development agencies.
The African Development Bank (AfDB) says it has budgeted $360bn for building infrastructure to 2040.
But much more money will be needed. The World Bank estimates it will cost about $93bn a year to address the continent's infrastructure needs.
Ms Peters says this will be derived from sources including the AfDB, the World Bank, and the private sector. However, with African countries among the least competitive in the world, and lack of infrastructure estimated to drain Africa's gross domestic product by 2% a year, governments will have to bring in private sector expertise from the beginning.
"Nobody's balance sheet is big enough — full stop," says Raenette Taljaard, senior lecturer in public policy at the University of Cape Town. "It is up to the private sector to hold the feet of politicians to the fire," she says, adding that Africans also need to be a "little more aggressive" in international debt markets.
Miriam Altman, a commissioner to the National Planning Commission in the Presidency, says Africa faces a "resource curse". This means "infrastructure will generally be orientated to the commodity that is being developed" and will not be oriented to social development. "How do you marry public and private interests?" she says.
One method is to ensure that private participation in infrastructure build is not "solely profit driven", says Ellen Hagerman, an international development consultant. But she says Brazil, Russia, India and China are not being asked to link African infrastructure investment to social responsibility.
Transnet is in London this week to assess market conditions for pricing an international bond to help fund its R300bn infrastructure investment programme over seven years.
While domestic funding will help meet future infrastructure needs, SA also needs to tap considerable external capital and technical expertise.
But threats of nationalisation have cast a negative light on the attractiveness of the country as an investment destination. And some see economic empowerment prescriptions as hampering cost-containment and industrial competitiveness.
Ms Altman says "commercial transport in Africa costs five times the global average", and this hampers the development of both manufacturing and beneficiation.
To this end, the Infrastructure Africa forum heard that the continent needed to move towards regionally integrated value chains, while devising a far more structured way for governments and private enterprise to interact and understand external and internal trade flows.