|South Africa may struggle to overcome global funding constraints as it bids to find the cash to boost infrastructure spending over the next few years, Trade and Industry Minister Mandisi Mpahlwa said on Tuesday.
South Africa plans to spend about 787 billion rand over the next three years to upgrade its transport infrastructure, such as rail and airports, and to increase electricity generating capacity.
Much of the spending will be made by state-owned companies, funded through their own balance sheets or loans.
“We have to fight hard as S.A. Incorporated to maintain the government infrastructure programme,” Mpahlwa told reporters.
“There are new challenges, financing it is going to be a lot harder but we have to do what we can to maintain our public infrastructure programme.”
State-owned power utility Eskom plans to spend over 343 billion rand while logistics group Transnet aims to spend 80 billion rand.
Both companies want to tap into international credit markets for a portion of the funds they require. The Treasury has loaned Eskom 60 billion rand and has offered a further 176 billion rand in loan guarantees.
Mpahlwa said the infrastructure spending would help put South Africa in a strong position to grow faster once the world economy started recovering.