Gauteng needs to take a lead in turning around South Africa’s economic situation, according to Gauteng Premier David Makhura, who avers that, “if Gauteng works better, 35% of South Africa’s economy will work better”.

Addressing delegates at the second Gauteng Infrastructure Investment Summit, in Midrand, the Premier highlighted infrastructure investment as among the top priorities of the Gauteng provincial government's programme for transformation, modernisation and re-industrialisation, which is in line with South Africa's National Development Plan Vision 2030.

Makhura reiterated that, with the country’s economy in a technical recession and its sovereign credit rating downgraded, “major interventions” are needed to reignite inclusive growth.

“Over many decades, infrastructure development and investment has played a major role as a stimulus for growth in many countries,” he added, further noting that, between 2013 and 2016, the Gauteng government invested R30-billion in infrastructure development, which is the largest rate of growth in infrastructure investment by any provincial authorities in the country.

Makhura highlighted that this investment created 92 000 direct jobs that now contribute to the Gauteng economy. It has also injected R15-billion into the economy to support household incomes, R6-billion to government revenue and has generated additional economic activity worth R26-billion for the provincial economy.

The Premier noted that, for every R1 that the province has spent on infrastructure, an additional 92c was added to the Gauteng economy.

He further highlighted that infrastructure spend was a key driver of economic transformation, with 91% spent on black-owned companies, especially in terms of construction and professional services.

“In the next three years, the Gauteng provincial government will spend R42-billion on infrastructure development, while our municipalities will spend R95-billion on social and economic infrastructure.”

Makhura added that Gauteng had 412 active infrastructure projects worth R200-billion, which were at various stages of development and implementation.

“All these infrastructure investments are part of the Gauteng city region's fifteen-year Infrastructure Master Plan, which will cost R1.6-trillion over the next decade and half,” he said.
 
Makhura explained that the Infrastructure Master Plan was the backbone of the provinces plan to develop Gauteng into a globally competitive city region, characterised by seamless spatial integration, economic inclusion and social cohesion. The Premier envisages Gauteng as a dynamic African city region driven by “smart, green, innovation-driven and knowledge-based industries”.

He further pointed out that Gauteng was a significant player in Africa’s economy, contributing between 8% and 10% of Africa’s total gross domestic product (GDP).

“Together with the State of Lagos, we are the sixth-largest economy in Africa, bigger than forty-nine of the fifty-four national economies on our continent,” he said.

In addition, Makhura noted that Africa’s $100-billion yearly infrastructure deficit presented many opportunities for African investors, developers, construction companies and professional services firms.

“We know that infrastructure investment plays a central role in integrating Africa’s markets – improving connectivity as well as facilitating the movement of goods, services and people across borders.”

He said that a one percentage point increase in infrastructure investment would raise Africa’s GDP by about 1.3% and employment by 0.7%.