Jun 19, 2012
$500bn infrastructrue plan to be presented to SADC leaders in AugustBack
Cairo|DRC|DURBAN|Luanda|Lubumbashi|Maputo|Africa|Hydropower|India|Power|PROJECT|Projects|Resources|Road|Standard Bank|Tourism|transport|Tripartite-Free Trade|Water|Africa|Europe|Angola|Brazil|China|Democratic Republic Of Congo|DRC|Germany|Japan|Kenya|Mozambique|South Africa|Tanzania|United Kingdom|United States|Zambia|USD|Bank|Energy|Finance|Finance Ministers|Metrology Infrastructure|Product|Transborder Infrastructure|Environmental|Infrastructure|East Africa
© Reuse this
The plan proposes the development of regional power, transport, water, communications, tourism and metrology infrastructure over the 15-year period, from 2012 to 2027.
The RIMP has been broken down into its respective subcomponents, with deployment expected to be pursued over three five-year intervals, with the first implementation period having been outlined for 2012 to 2017.
SADC secretariat deputy executive secretary for regional integration João Caholo says the master plan is the product of ‘deep’ stakeholder consultation and will be presented to regional infrastructure ministers in Luanda, Angola, next week and then to a gathering, in the same city, of the bloc’s finance ministers in July.
Chaolo and his team also hope to convince the finance ministers to align the implementation of the plan with the establishment of a SADC development fund, or bank, with an initial capitalisation of between $600-million and $1-billion.
He stresses, though, that the master plan is not dependent on the creation of such a regional financing mechamism. “But we need leadership and commitment from the 15 SADC member States,” he avers, explaining that these countries are the “sole custodians” of the RIMP.
The initiative is based on an assessment that intraregional trade is currently constrained by a lack of ‘connectivity’ and that the development of transborder infrastructure could stimulate further growth and development, as well as facilitate a transition away from the current over-reliance on mineral and agricultural resources within SADC economies.
At present, intraregional trade comprises less than 20% of total trade and the bulk of that trade takes place between South Africa and the other 14 member States. Recent research published by Standard Bank shows that South Africa’s trade with the rest of Africa rose to R220-billion, or 17% of the country’s total trade with the world. But the bank concludes that “South Africa does not trade enough with Africa” and that the country’s “weak economic diplomacy” on the continent means that full commercial value is not being gained.
“One of the critical missing links is infrastructure,” Caholo asserts. But he acknowledges that far more also needs to be done to reduce the red tape and improve standards harmonisation so as to facilitate greater intraregional trade and investment.
Power interconnector projects feature prominently in the plan, including transmission network proposals that move beyond the SADC boundaries into East Africa, such as the Zambia–Tanzania–Kenya Interconnector.
In fact, Caholo stresses that there has been a deliberate effort to align the RIMP with moves to foster the so-called Tripartite-Free Trade Area, or T-FTA, involving the SADC, the Common Market for Eastern and Southern Africa and the East African Community blocs.
The T-FTA negotiations began last year and should they be concluded, the area would span from Cape to Cairo, include 27 countries, 533-million citizens, and represent a combined gross domestic product of $833-billion. A preliminary date of 2013 has been set for the T-FTA’s launch.
Caholo reports that the RIMP has also be aligned with the 51 priority infrastructure projects identified by the African Union, under the Programme for Infrastructure Development in Africa, or Pida, which includes the much-vaunted Inga hydropower project, of the Democratic Republic of Congo (DRC), as well as the proposed North-South transport corridor, linking Lubumbashi, in the DRC, to Durban, in South Africa.
The Pida is also likely to receive support from the World Bank, whose newly appointed VP for the Africa region Makhtar Diop is on record as saying that infrastructure projects that promote further regional integration are likely to be prioritised by the bank in the coming years.
Once the plan has been officially endorsed, the SADC secretariat will conduct road shows in Brazil, China, Europe, India, Japan, the UK and the US to expose potential investors to the opportunities available within the RIMP.
Caholo says that, while the member States will be the primary drivers, the challenge is too large for the countries to tackle alone and there will be scope for foreign participation, as well as for the private sector. The investment need in the energy sector alone over the coming five years is estimated to be $42-billion.
The immediate priority, though, is to undertake technical, environmental and financial feasibility studies for the project so as to prepare them for presentation to investors.
A Project Preparation Development Facility (PPDF) has already been established at the Development Bank of Southern Africa, but Caholo says additional resources are required to enable it to carry out the feasibility investigations.
The PPDF has already received some grant funding from KfW, of Germany. The member States will be asked to inject further capital to enable it to prioritise, select and progress projects to a bankable stage.
Edited by: Creamer Media Reporter© Reuse this
To subscribe email firstname.lastname@example.org or click here
To advertise email email@example.com or click here
Other Electricity News
Recent Research Reports
Construction 2016: A review of South Africa's construction industry (PDF Report)
Creamer Media’s Construction 2016 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; key participants; local demand; geographic diversification; corporate activity; black economic...
Energy Roundup – February 2016 (PDF Report)
The February 2016 roundup covers activities across South Africa for December 2015 and January 2016 and includes details of a Government Gazette notice that confirms Cabinet’s decision to move ahead with the 9 600 MW nuclear procurement programme; State-owned power...
Energy Roundup - December 2015 (PDF Report)
The December 2015 roundup includes details of State-owned utility Eskom’s application to claw back R22.8-billion; South Africa’s ranking as an investment destination for renewable energy; and a nuclear expert’s thoughts on reactor designs for South Africa’s nuclear...
Water 2015: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2015 Report considers the aforementioned issues, not only in the South African context but also in the African and global context in terms of supply and demand, water stress and insecurity, and access to water and sanitation, besides others.
Input Sector Review: Pumps 2015 (PDF Report)
Creamer Media’s 2015 Input Sector Review on Pumps provides an overview of South Africa’s pumps industry with particular focus on pump manufacture and supply, aftermarket services, marketing strategies, local and export demand, imports, sector support, investment...
Liquid Fuels 2015: A review of South Africa's liquid fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2015 Report examines these issues in the context of South Africa’s business environment; oil and gas exploration; fuel pricing; the development of the country’s biofuels industry; the logistics of transporting liquid fuels; and...
This Week's Magazine
Updated 7 hours ago Lifting, transporting, installing and ballasting solutions provider Ale has expanded its global fleet of trailers and invested in the latest range of widening trailers that can be mechanically widened from 3 m to the desired width for any project. Ale ordered 48 axle...
Updated 7 hours ago The market for the BMW 7 Series in South Africa differs quite significantly from the rest of the world. China, the US and the Middle East almost exclusively buy the long-wheel-base version, using the German manufacturer’s luxury high-end sedan as a chaffeur-driven...
Updated 7 hours ago January new-vehicle sales fell by 6.9%, to 48 615 units, compared with the same month last year. Statistics released by the Department of Trade and Industry show that the domestic new passenger-car market declined by 6.1%, to 34 936 units, compared with 12 months ago.
Updated 7 hours ago Information technology (IT) equipment and infrastructure multinational Dell is providing open infrastructure systems for clients so that they can use any systems, including innovative new systems, that suit their business needs, says Dell Europe, Middle East and...
Updated 7 hours ago South Africa’s State-owned defence industrial group, Denel, has set up another international partnership, based in Hong Kong. This new subsidiary is Denel Asia and it is a joint venture (JV) with South African private sector company VR Laser.