The affordable education loan option
Fostering more innovative financing solutions such as Public-Private Partnerships (PPPs) and municipal bonds needed to be seriously looked at to expedite much-needed infrastructure development, especially at municipal level in KwaZulu-Natal.
This is according to KZN Treasury officials and bosses from auditing and consulting firm Deloitte, who on Tuesday announced a two-day event to be hosted in Pietermaritzburg later this month that would explore opportunities around infrastructure funding. Dubbed the KZN Infrastructure Funding Fair, it is a follow-up, but more niché-orientated, event to the KZN Funding Fair in Durban earlier this year.
Set to take place at the Royal Showgrounds on October 24 and 25, the first day will deal with innovative funding of infrastructure. Small business funding is set for day two.
Clive Coetzee, general manager for Infrastructure Management and Economic Services at the KZN Treasury, said the fair would offer an opportunity to KZN municipalities and provincial departments struggling with service delivery backlogs to secure financing for multimillion-rand projects.
“The partnership between the KwaZulu-Natal provincial government and Deloitte KZN follows the success of the inaugural KZN Funding Fair in April, which has to date seen more than R300 million|secured for business-related development projects,” he said.
Coetzee said 15 municipalities and provincial government departments were already signed up for the Pietermaritzburg event, with 60 projects that would pitch for funding worth more than R6 billion.
Guy Brazier, the managing partner of Deloitte KZN, said: “The inaugural event was hosted in partnership between Deloitte, the KZN Treasury and the Department of Economic Development and Tourism… It saw face-to-face contact between project promoters, entrepreneurs, business development bodies, venture capitalists, private equity investors and debt funders.”
The fair would focus on municipal and provincial infrastructure funding needs and what alternative financing solutions could be explored outside limited rates revenue and state grants.
“Deloitte is committed to the growth of KwaZulu-Natal and sound municipal infrastructure is a critical element for ensuring economic growth and development.
“PPP’s are going to become an increasingly important option to deliver on key infrastructure projects in the country,” said Brazier.
Coetzee said PPPs – jointly funded and executed projects that involved the government and private sector player working together – was a option that needed to be looked at in a new light.
“We only have a handful of PPPs in KZN. There may be a perception issue around the success of PPPs, but that needs to change and we need more of such joint projects to address our infrastructure and development needs as a country. We also need to look at municipal bonds and other options for financing municipal and other infrastructure, because the state fiscus is simply not sufficient,” he said.
André Pottas, Deloitte KZN’s corporate finance leader, said the KZN Infrastructure Funding Fair would build on the success of the funding fair in April. He said provinces like Gauteng and the Western Cape were also keen to host similar events.
“Provincial government cannot resolve the municipal infrastructure backlog with its current resources… Despite government funding being available via the Municipal Infrastructure Grant, there is insufficient capital for meeting service delivery requirements, especially in historically underserviced areas. This means funding must be sourced from alternative financiers and the fair provides a platform for translating those requests into reality,” Pottas said.
Funders invited to attend the fair include commercial banks, development finance institutions such as the Development Bank of South Africa, the European Investment Bank, the German government-owned development bank KfW, China Construction Bank, Ithala Development Finance Corporation and the Industrial Development Corporation.
* The Mercury is the official media partner of the event. To register to attend, or for more information go to www.kznfundingfair.co.za