South Africa eyes sovereign wealth fund to drive infrastructure, industrial growth

SOUTH Africa is intensifying discussions around the creation of a sovereign wealth fund.

- SIPHELELE DLUDLA

Policymakers, economists and development finance leaders on Tuesday highlighted the fund's potential to unlock long-term investment, strengthen economic sovereignty, and accelerate infrastructure development across the country and the broader African region.

Speaking at a high-level investment dialogue during the 6th SA Investment Conference, participants emphasised that while South Africa has long debated the idea of a sovereign wealth fund, the time has come to move from concept to implementation—anchored by strong institutional design and clear policy direction.

A central theme emerging from the discussion was the need for a robust legislative and governance framework to ensure credibility and effectiveness.

Panellists argued that without enabling legislation and strong oversight, a sovereign wealth fund risks failing to attract the partnerships and capital required to succeed.

Patrick Dlamini, CEO of the Public Investment Corporation (PIC), the largest asset manager in Africa with about R3.8 trillion assets under management, said there must be enabling legislation that lends credibility to the institution, supported by optimal governance structures.

"I think it's an overdue issue for South Africa if you ask me," Dlamini said. "But I think I was also quite happy to see in the G20 legacy, social legacy project that this matter was looked into quite deeply.”

Dlamini also pointed out to the country's mineral endowment and how that can be leveraged to kickstart the fund.