There is a genuine disconnect between South Africa’s infrastructure plans and aspirations, and the level of activity in the actual project economy.

There is no question that the National Infrastructure Plan is ambitious, but well intentioned. However, it is failing to translate into new awards at contractor level, with most of South Africa’s large construction companies venturing elsewhere to fill their order books.

The reality is that the growth outlook for South Africa remains weak and well below the 5.4% yearly growth target outlined in the National Development Plan.

The megaprojects that are being pursued, most notably in the electricity environment, are facing significant challenges. State-owned electricity utility Eskom, for example, is implementing some of the largest capital projects ever undertaken in South Africa to alleviate the country’s electricity supply shortfalls, but the projects are over budget and well behind schedule.

Local business confidence levels have been significantly affected by a hostile labour-relations climate, particularly in the mining and manufacturing sectors. There is ongoing uncertainty about international macroeconomic conditions, while low investment and savings levels, together with weak demand and energy constraints, continue to weigh heavily on the domestic outlook.

The main positive countervailing force is the resilience being shown by South Africa’s neighbours and several other African countries, which continue on their upward growth trajectories. There is a concern, though, that the benefits of this growth are not being properly distributed.

But, while fixed investment is running well below potential, it nevertheless continues to take place.

There are pockets of strength, as reflected in the roll-out of greenfield renewable-energy projects by private producers. In addition, there has been welcome progression on some large freight and passenger rail projects.

The resources sector continues to dominate the private-project pipeline. That includes expansion and replacement projects in the coal, diamond, gold, platinum, ferrous minerals and uranium sectors.

The latest edition of the Projects in Progress supplement will provide insight into some of the larger public and private projects being undertaken across South Africa, as well as selected African economies, including Botswana, Ghana, Mozambique, Namibia and Zambia; while demonstrating that serious gaps remain in progressing some important transformational projects from planning to implementation.

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