SA Launches Project Preparation Bid Window to Boost Infrastructure Development

Public Works and Infrastructure Minister Dean Macpherson, alongside Acting Head of Infrastructure South Africa (ISA), Mameetse Masemola, unveiled the bid window in Johannesburg on Tuesday.

In a significant move to enhance infrastructure investment and economic growth, the South African government has announced the launch of a groundbreaking project preparation bid window. This initiative allows state-owned entities, public entities, and municipalities to apply for project preparation support, aiming to address critical infrastructure gaps across the nation.

Commitment to Economic Growth

Public Works and Infrastructure Minister Dean Macpherson, alongside Acting Head of Infrastructure South Africa (ISA), Mameetse Masemola, unveiled the bid window in Johannesburg on Tuesday. Minister Macpherson emphasized the initiative’s importance, stating, “As we unveil the first-of-its-kind project preparation bid window, we are taking a decisive step towards achieving the economic growth and job creation that our country so desperately needs.”

This bid window invites submissions from national and provincial governments, state-owned entities, public entities, municipalities, and private sector projects, offering much-needed support in preparing for infrastructure development.

A Shift from Planning to Action

Macpherson highlighted the transformative potential of infrastructure development, stating, “It is not just about bricks, mortar, or steel. It is about creating a solid foundation for our economy to thrive, for our people to prosper, and for our nation to rise.” He pointed out that the initiative marks a critical evolution in Infrastructure South Africa's approach, enabling the country to move from planning to action. “No longer are we talking about the pipeline of infrastructure projects, we are building,” he affirmed.

Historically, one of the significant barriers to infrastructure development in South Africa has been insufficient project preparation support. Macpherson stated that this new initiative provides essential tools to ensure that infrastructure projects are "shovel-ready," paving the way for efficient implementation.

Addressing Underinvestment Challenges

Acting ISA head Mameetse Masemola echoed Macpherson's sentiments, highlighting that the lack of adequate project preparation support has contributed to underinvestment in infrastructure. “To address these challenges and unlock the potential of infrastructure investments in South Africa, the National Treasury has granted ISA a project preparation fund to support project development and accelerate the pace and quality of infrastructure delivery,” she explained.

The project preparation support will significantly expand the capability of construction projects to be implemented in South Africa. Masemola outlined ISA's plans to catalyze seed funding that can be blended with other project preparation facilities, ensuring the development of viable and bankable infrastructure projects.

Alignment with National Initiatives

This new bid window builds on the twelve infrastructure initiatives previously announced by President Cyril Ramaphosa at the Sustainable Infrastructure Development Symposium South Africa (SIDSSA) in March 2024. The initiative has already benefited from an initial allocation of R179 million in project preparation funding from the National Treasury to support catalytic projects that would not otherwise progress to implementation.

Application Details and Priority Sectors

Applications for the project preparation bid window are now open and will close on December 6, 2024. This phase specifically targets projects valued at over R1 billion, with the potential to attract investment from alternative sources, including Multilateral Development Banks and Development Finance Institutions, rather than relying solely on national fiscal resources.

Selected projects will receive comprehensive project preparation assistance, encompassing funding structuring support, technical and legal assistance, institutional and governance arrangements, capacity deployment, and regulatory compliance studies.

The priority sectors eligible for project preparation financing include:

Energy

Water and Sanitation

Transport (major roads, airports, ports, and freight transport)

Human Settlements (excluding student accommodation)

Social Infrastructure (Education & Health)

Municipal Infrastructure (focusing on projects with potential for private sector financing)

Industrial Development Zones & Special Economic Zones (IDZs & SEZs)

Guidelines for the project preparation bid window can be accessed on the official website at www.infrastructuresa.org. This initiative represents a significant step forward in South Africa's infrastructure development journey, fostering an environment conducive to sustainable growth and job creation.