The government is considering a development fund that could raise money for projects linked to the planned South African National Property Company, Public Works and Infrastructure Minister Dean Macpherson said in a Bloomberg TV interview.
Authorities recently discussed the proposed fundraising vehicle with the Johannesburg Stock Exchange after receiving advice from Middle Eastern sovereign wealth funds, although Macpherson did not identify the funds.
Turning property into capital
President Cyril Ramaphosa announced the South African National Property Company in February. The state-owned company will oversee about 88,000 government buildings and 5 million hectares of land.
The government hopes to make greater use of these assets as it seeks to close a large infrastructure funding gap. South Africa estimates it needs R1.6 trillion ($98.1 billion) in public-sector investment and another R3.2 trillion ($196.1 billion) from private companies to meet its infrastructure targets by 2030.
Gulf investors targeted
South Africa is also planning to establish an Infrastructure South Africa office in the Middle East, most likely in Dubai, to strengthen its links with Gulf investors.
Infrastructure South Africa last year presented investment opportunities in energy, water and logistics to sovereign wealth funds, state entities and government ministries in the UAE, Kuwait, Saudi Arabia and Qatar.
The country has a R350 billion ($21.5 billion) construction pipeline, with procurement and construction expected to begin within the next 12 to 18 months.
The push comes as South Africa seeks to accelerate construction, attract private capital and revive an economy constrained by weak growth and strained public finances.
