South Africa could unlock $293 billion for infrastructure with financial system overhaul

South Africa could unlock as much as 5 trillion rand ($293 billion) in infrastructure and clean-energy investment if it undertakes a major overhaul of its financial system, according to a new study prepared for the National Planning Commission (NPC).

The findings show how structural reforms to the country’s monetary and financial framework could open the door to large-scale capital flows urgently needed to revive economic growth.

The report, expected to be released later on Tuesday, contends that South Africa’s existing financial architecture is not adequately designed to channel investment into priority areas, such as infrastructure development, renewable energy, and strategic sectors identified in the National Development Plan (NDP), as reported by Business Day.

More than a decade after the NDP was adopted, South Africa is grappling with some of the world’s highest unemployment levels, persistent inequality, and an economy that has expanded by less than 1% per year over the past decade.

Growth has been constrained by ageing infrastructure, chronic electricity shortages, rail and port bottlenecks, crime, and corruption, all of which have deterred both domestic and foreign investment. Business Insider Africa earlier reported that Johannesburg, Africa’s richest city, needs approximately $12 billion (R221 billion) for infrastructure repairs.

To meet the NDP’s 2030 targets, the country needs an estimated 1.6 trillion rand in public-sector infrastructure investment and an additional 3.2 trillion rand from private-sector partners.

Reforms, the study notes, would help unlock infrastructure funding pipelines and accelerate South Africa’s shift toward renewable power, grid expansion, and sustainable economic growth.

President Cyril Ramaphosa, speaking in June about his government’s infrastructure drive, emphasised its importance to South Africa’s future.

“Infrastructure is the flywheel that our economy needs to boost growth and to create jobs. Infrastructure that is well constructed and maintained encourages investors to see our country as a great investment destination.”

In March, South Africa, in partnership with the World Bank, launched a $3 billion initiative to restore essential services and improve infrastructure in eight of its largest cities.