international
construction
july-august 2014
REGIONAL REPORT
28
South African Hope
These investment plans have been dangled in front of the
industry for some time now, but little actual cash has been
spent. However, the signs are that by the end of this year the
first spending packages will be released.
Eskom for instance is considering another mega-coal generator
as well as up to five nuclear plants. It has commissioned dozens
of solar, wind and renewable generation projects, with more to
come. Energy is probably the one bright spot on an otherwise
bleak horizon. By the end of this year 400 wind turbines will
have been installed in South Africa.
Development driver
In other sectors however, movement has been slow. The bright
spot is that the government is now just as desperate as the
construction industry to unblock the project pipeline. It will
need annual economic growth of +5%, twice what it is now, if
the country is to tackle unemployment effectively and maintain
its development plans. With youth unemployment running
at more than 35%, the ruling African National Congress is
anxiously aware that this represents a sizeable constituency it
will have to answer to in future elections.
Figures released by Statistics South Africa (StatsSA) in March
show the construction sector shed 8,000 jobs in 2013, 7,000 of
which came in the final quarter. StatsSA said that while many
of the job losses were the result of project completion, the flow
of new work had failed to soak up excess labour. It does now
appear that government and the industry are beginning to work
together to get those numbers turned around.
“The willingness of the private sector to engage with
government around speeding up infrastructure delivery is very
clear; there are many initiatives,” said Ketso Gordhan, the CEO
of PPC, the country’s largest cement maker. “The business
leadership of South Africa has created a working group that is
interacting with government. Everybody is very excited, it is
clear everybody needs a new way in which infrastructure can
be delivered.”
In the meantime the industry has other issues to contend with.
Heavy rains and flooding caused delays on building sites across
the country in February and March. According to the South
Mining has been
the biggest private
sector driver
of construction
but the industry
is now having
troubles of its own
following strikes
and the fall in
commodity prices
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