The United Kingdom has agreed to assist South Africa to improve its infrastructure and make better use of state-owned property.
A key focus will be restructuring and reforming the state’s property management trading entity, which owns and operates 88,000 buildings and more than 5 million hectares of land, none of which currently generate revenue.
Economists have long argued that infrastructure investment is key to driving productivity, economic growth, and, importantly, job creation in South Africa.
According to Business Day, this follows an agreement signed by UK chancellor of the exchequer, Rachel Reeves, and South Africa’s public works and infrastructure minister, Dean Macpherson, on the sidelines of the G20 finance leaders’ meeting.
Reeves said: “Our two governments …are working together to take forward this important agenda.” Reeves said it would stimulate economic growth and benefit businesses in both countries and deepen the relationship between South Africa and the UK.
According to Business Day, the UK investment focuses on providing technical expertise and strategic support for high-impact projects in infrastructure, asset management and municipal infrastructure.
Macpherson said: “Unfortunately, we do not have the critical skills any more to be able to enact the turbocharging of infrastructure development that we need.”
He added: “We need more co-ordination and a more centralised form of procurement and implementation of projects under an entity like Infrastructure SA.”
The UK high commissioner to South Africa, Antony Phillipson, said: “It’s not really about a fixed amount that we are putting on the table. It is about investing in relationships; it’s about bringing our companies and their expertise here.”
Macpherson pointed out: “We are the only landlord in SA that does not make money. We have become a benevolent society and charity for other government departments. That must change. These assets must make money for the state so that we can reinvest it into social infrastructure.”