Infrastructure development is critical to stimulate economic growth during the prevailing turbulent economic conditions, where competition is rife, the Steel and Engineering Industries Federation of Southern Africa said on Wednesday.
Speaking ahead of the 2016 Southern African Metals and Engineering Indaba, to be held in May, CEO Kaizer Nyatsumba said in a statement that, to fast-track economic growth in South Africa and the rest of the Southern African Development Community (SADC) region, there was a need to develop infrastructure and transport logistics that would enable emerging economies to compete globally.
“With infrastructure development playing a fundamental role in accelerating any country’s economic growth, governments’ spend on infrastructure development not only provides a stimulus to a country’s economic growth, but it can also crowd in private sector and foreign direct investment (FDI),” he noted.
While current difficult economic conditions made raising money to finance SADC’s “huge infrastructure backlog” difficult, it was “almost impossible” for any developing country to prosper without reliable infrastructure.
“African countries in general and countries within the SADC region in particular are in dire need of FDI,” Nyatsumba stated.
“Infrastructure development has the potential to play a positive role in attracting FDI and private sector investment, but the difficulty in raising finance for infrastructure development poses a threat to accelerating economic growth.”
In line with this, he noted the importance of collaboration and deliberation between stakeholders from government, labour and business on strategies aimed at unlocking SADC’s economic growth through infrastructure development.