UK’s Reeves announces South Africa infrastructure partnership

UK Chancellor Rachel Reeves announced an infrastructure partnership with the South African government to boost investment in Africa’s biggest economy.

“Infrastructure investment in both of our countries is absolutely key to driving productivity, economic growth and importantly job creation,” Reeves said.

The pact, announced in the South African port city of Durban on the sidelines of a Group of 20 meeting, is designed to speed up the delivery of major infrastructure projects in the nation as it scrambles to clear a backlog that’s hindering economic growth.

South Africa’s economy has grown at less than 1% a year on average for more than a decade.

Under the partnership, Reeves said, the UK will offer South Africa technical expertise to get a pipeline of projects ready for investment. She cited a similar programme with Peru as a model for the collaboration.

British expertise

“British expertise will be brought in to unblock these barriers on building, speeding up a pipeline of projects which British firms are well-placed to win tenders for,” the UK Treasury said in a statement on Thursday. “This will help growth and development in South Africa, and also help Britain get better return on its investments in the country.”

South African President Cyril Ramaphosa has estimated that the nation needs 4.8 trillion rand ($269 billion) in public and private infrastructure investment by 2030 to meet its goals. The country’s Treasury has allocated 1 trillion rand to public infrastructure over the next three years.

South Africa’s public infrastructure deficit ranges from inadequate water treatment and supply facilities to a need for investment in power transmission lines and the rehabilitation of rundown city centers in major metropolitan areas such as Durban and Johannesburg.

The country’s Minister of Public Works and Infrastructure, Dean Macpherson, has stated that his department seeks to boost investment in cities through more private investment.

He has bemoaned the fact that many municipalities return infrastructure allocations to treasury because they lack the expertise to implement projects.

“By injecting technical expertise and delivery support into stalled projects” through the partnership, the department aims to use neglected buildings and vacant state land to boost economic growth and create jobs, Macpherson said in the statement.

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At $7.7 billion in two-way trade, the UK is South Africa’s seventh-biggest trading partner and one of its largest investors. It is also part of the Just Energy Transition Partnership between South Africa and some of the world’s richest nations. Under that agreement $8.3 billion in climate finance could flow to South Africa.

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