The 2023 Medium Term Budget Policy Statement (MTPBS) recognises, reflects and has been structured to respond to key headwinds facing the global and South African economy.
The policy positions contained in this mini-budget are welcome for the fact that they communicate important reform signals. The only way to place the economy on a solid and sustainable trajectory is through economic growth and to achieve that, reform is critical. Particularly reform in the delivery of large-scale infrastructure projects.
For the steel sector, one of the most important policy considerations communicated is the opportunity for the private-public-partnerships (PPPs) in the financing and execution of large infrastructure projects. This will ensure that projects are executed with efficiency and speed.
The MTPBS posits the creation of new mechanisms to facilitate co-investing with the private sector and multilateral institutions on selected infrastructure projects and employing alternative financing instruments for priority projects.
These infrastructure projects are a crucial demand source for the metals and engineering sector, which has been languishing in a low demand environment for the last 15 years, therefore their speedy and successful execution is of significant importance to the sustainability of the sector.
We eagerly await the details that will underpin this PPP framework. However, even prior to this announcement in the MTPBS today, SEIFSA have already begun engaging relevant departments, including National Treasury to fast track this objective.