Government is investing on a large scale to provide water, transportation, electricity, telecommunications, housing and other infrastructure.
Over the mid-term expenditure framework period in the three years ahead, approved and budgeted infrastructure plans amount to R845 billion, of which just under R300 billion is in the energy sector and R262 billion in transport and logistics projects, finance minister Pravin Gordhan said this afternoon, presenting his budget to Parliament.
However, there are only two ICT projects included in government's 43 infrastructure projects. One is an R800 million investment by state signal provider Sentech into digital television infrastructure, and the other is the R1 billion to be invested by Broadband Infraco in additional broadband capacity.
The aim of the planned spending is to remove critical bottlenecks and allow the economy and jobs to grow at a more rapid pace. "Improved planning and management of these projects are critical if these outcomes are to be achieved, alongside accelerated private-sector investment," states the 2012 budget review.
Gordhan, presenting SA's first R1 trillion budget, said an expansion in infrastructure investment is one of the central priorities of the 2012 budget. In addition, government is placing "special emphasis" on improving industry competitiveness, investing in technology and encouraging enterprise development.
"Government has supported the recovery from the 2008 recession, but as we expand infrastructure investment over the period ahead, we have to see business investing in our future as well."
Tough times
Gordhan said the global environment remains highly uncertain. "While there are signs of a revival in the US economy, much of Europe is in recession, and significant financial risks cloud the global economic outlook."
SA's economic growth is expected to slow to about 2.7% this year as a result of the global slowdown, he said. Gross domestic product growth should pick up to 3.6% in 2013 and 4.2% in 2014.
Last year, the economy was expected to grow at 3.1%.
However, SA's finances are in good health as the country is expected to reach a budget deficit of 4.6% of gross domestic product in the new financial year, which should drop to 3% by 2014/5.
Gordhan said the budget continues to support job creation, with a particular focus on unemployed youth. The bulk of spending will go on education, health and social assistance, he said.
Share
