Finance minister Trevor Manuel
says the “electricity outages
that South Africans experienced
in the first quarter of this year
signal capacity constraints in
several areas of infrastructure,
including roads, rail, ports and
most critically in skills”.
Delivering his medium term
Budget in parliament last week,
Manuel said “these capacity
constraints have also slowed
economic activity and will
restrict growth in the near term.
“To break these constraints,
we must invest more.”
However, financing these
investments in the period ahead
will be challenging.
Government will support our
state-owned enterprises through
providing selective guarantees
on their borrowing and through
increasing the capacity of
our development finance
institutions to contribute to
funding major infrastructure
projects, he said.
Signalling that the days
of cheap power and water
are over, Manuel said: “At
the same time, it is essential
to price utility services
appropriately so that we
encourage more efficient use
of these inputs and generate
the resources to fund greater
expansion in capacity.
“We must also create a
more amenable environment
for the private sector to
invest in economic and social
infrastructure.”
Additional expenditure
announced by Manuel includes
a R2.5 billion bail-out for the
Road Accident Fund.
Provincial budgets for
“increasing investment in
housing, roads and other
economic infrastructure” have
also been increased.
According to the annexure
provided by the Department of
Transport, expenditure in the
first six months of 2008/09 was
R11.541 billion, or 47.1% of
the adjusted appropriation of
R24.493 billion for the year as
a whole.
Expenditure in the first six
months of 2008/09 increased
by R4.881 billion, or 73.3%
compared to spending in the
first six months of 2007/08.
The main increases for 2008
are “related to the transfer of
conditional grants funding
to provinces for the Gautrain
Rapid Rail Link.
Falling behind in its
spending is the Department of
Public Works, which reported
that expenditure in the first six
months of 2008/09 was
R1.71 billion, or 39.7%of
the adjusted appropriation of
R4.302 billion for the year as
a whole.
Expenditure in the first six
months of 2008/09 decreased
by R260.7 million or 13.2%
compared to spending in the
first six months of 2007/08.
The department said the
main decreases were due to
“the slow pace of spending on
capital projects”.
Capacity constraints hit economic growth
31 Oct 2008 - by Ed Richardson
0 Comments
FTW - 31 Oct 08
31 Oct 2008
31 Oct 2008
31 Oct 2008
31 Oct 2008
31 Oct 2008
31 Oct 2008
31 Oct 2008
31 Oct 2008