SA to launch R15 billion infrastructure bond to boost project investment levels

THE government will launch a R15 billion infrastructure bond soon to help fund badly needed infrastructure projects, which, in turn, should provide a stimulus for faster economic growth and job creation in the economy.

- EDWARD WEST

Finance Minister Enoch Godongwana said in the MTBPS that the government will also contribute R2bn to capitalise a Credit Guarantee Vehicle. Initially, this vehicle will support electricity transmission expansion - South Africa's renewable energy rollout is being stymied by a shortage of thousands of kilometres of transmission lines, such as between the Northern Cape, where many new renewable energy operations are based, and other parts of the country.

“This heralds a new era in PPPs (Public-Private Partnerships), where private investment in high-voltage transmission lines is enabled,” he said.

South Africa has, for at least two decades, suffered from declining infrastructure investment.

Capital investment has been flat overall in the past two years because slowly rising public sector investment has offset falling private sector investment.

President Cyril Ramaphosa has consistently described infrastructure development as the flywheel required to get the economy to grow faster.

“We are shifting the composition of spending from consumption to investment. Capital payments are the fastest-growing expenditure item at 7.5 per cent over the medium term,” said Godongwana.

He said amendments to PPP regulations took effect on June 1, 2025, and these were expected to unlock the potential across spheres of government, and streamline approvals for smaller projects.