Infrastructure key to recovery

SA’s much-anticipated Covid-19 economic recovery plan will be unveiled soon, and infrastructure will play a “key role” in unlocking investment and getting the economy out of the hole it is in.

That’s the word from President Cyril Ramaphosa, who was speaking at the launch of JSE-listed Balwin Properties’ multi-billion-rand Mooikloof Mega City development, east of Pretoria.

The president did not give any details on the plan.

“We need to unlock energy in the economy,” he said, citing the new inclusionary housing development as an example of mega infrastructure projects that can help kickstart economic growth.

Light-heartedly dubbing the development “Steve Brookes City” – after the CEO of Balwin Properties – Ramaphosa called for infrastructure to be seriously built up in the country in a more “synchronised manner” together with the private sector.

“Infrastructure [investment] is a key part of the economic recovery plan of the country post Covid-19.

“It’s no longer about talk … to make our dreams come true, we must move ahead with implementation. We must khawuleza or hurry up in meeting our people’s needs.”

He added that he is excited to see the Mooikloof development moving ahead with 50 000 sectional title units planned, making it one of the largest developments of residential inclusionary housing in the country.

“Once completed, Mooikloof Mega City may end up becoming the world’s largest sectional [title] property development, with land also earmarked for schools, shops and offices,” he added.

The overall Mooikloof Integrated Development has a total project value of over R84 billion and is one of the 62 Strategic Integrated Projects (SIPs) that were gazetted at the end of July, Ramaphosa said.

Balwin’s residential side of the development is touted to be valued at between R30 billion and R44 billion, and will be developed in phases over several years.

The government, through its proposed R350 billion infrastructure fund [latest exact figure to be revealed in its economic recovery plan], is investing R1.4 billion in bulk infrastructure to unlock the development.

This includes the expansion of the Garsfontein provincial road, which runs adjacent to the site.

Ramaphosa noted that the Mooikloof development will make a big contribution to inclusionary housing in South Africa, helping to address spatial integration.

Housing for the ‘missing middle’

“This housing development addresses what may be referred to as the ‘missing middle’ – people who earn too much to qualify for fully subsidised housing but who don’t earn enough to afford debt-financed housing,” he said.

“We continue to feel the effects of apartheid spatial design in what may be termed the 40/40/40 principle,” said Ramaphosa.

“This means most people are housed 40km from employment opportunities, as a result, they spend over 40 minutes travelling to and from work, and spend over 40% of their incomes on transport expenses.

“In many cases those affected are the poor who live in 40m2 houses,” he added.

Ramaphosa said that the department of human settlements, through the Housing Development Agency, will assist in making it possible for more low-income households to benefit from the Mooikloof development.

“Potential homeowners will also be able to apply for assistance from government’s Finance Linked Individual Subsidy Programme,” he said.

This article first appeared on Moneyweb and was republished with permission.

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