Infrastructure in South Africa: Who is to finance and who is to pay?

Stellenbosch Working Paper Series No. WP15/2007
 
Publication date: 2007
 
Author(s):
[protected email address] (Department of Economics, Stellenbosch University)
[protected email address] (Department of Economics, Stellenbosch University)
 
Abstract:

Against the backdrop of shifting views on the role of government in the provision of infrastructure, this paper distinguishes between the payment for and financing of the South African Government’s infrastructure investment programme. The paper also presents a classification system that enables a systematic mapping of all prospective projects, with reference to considerations of efficiency and equity. This mapping should assist in macro planning and in any analysis of the financial implications of project financing and cost recovery at all levels of government. The government’s financing strategy is questioned and alternatives are identified. The prospects for mobilising funds other than tax revenue are assessed, namely government loans, private equity, development finance and donor funds. Four investment projects are considered with a view to testing the classification system and evaluating the chosen financing options in terms of economic criteria.

 
JEL Classification:

H54, H81, H72

Keywords:

Infrastructure financing, government loans, benefit taxation, guarantees, private-public partnerships, South Africa

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14 October 2019
While incoming data on the global economy remains downbeat, the mood was lifted last week after progress was made on US-China trade talks and Brexit negotiations. On the domestic data front, mining and manufacturing data for August added to growing evidence that real GDP growth likely slowed significantly in 2019Q3 after the nice rebound recorded in...

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