South Africa: Building On Optimism - - Big Infrastructure Projects Return to SA in Water, Housing, Energy Sectors

analysis

Municipalities, state-owned enterprises and private sector players are starting to open their wallets to spend money on developments that will enhance growth and create much-needed jobs.

The skylines of cities in South Africa might soon feature cranes and scaffolding, as the country is on the cusp of infrastructure projects returning after a 15-year drought.

Several players in the construction industry's long value chain - from cement producers to property developers - are reporting renewed interest in and preparation for new infrastructure projects, driven by optimism about the domestic economy and the government of national unity (GNU).

Take PPC, South Africa's largest cement maker. On 16 January, the company announced that it plans to spend R3-billion to build a new cement-making plant at its existing site in the Western Cape.

The plant will start production in 2026 and supply customers in the province as well as the Eastern and Northern Cape. Once operational, it will produce 1.5 million tonnes of cement a year, enough to build about 25 stadiums the size of Johannesburg's FNB Stadium.

It is a big undertaking by PPC at a time when South Africa is battling a cement oversupply, cheap imports from China, Pakistan and Vietnam that undercut local players, and an economy that is still in the doldrums.

However, PPC...

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