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CPCS strengthens South Africa’s PPP framework

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PPP framework anticipated to speed up infrastructure delivery, and has triggered additional procurement reforms within the Government of South Africa (GoSA).

 

Client: World Bank

Client type: International financial institution

Location: South Africa

Project type: Public-private partnerships

Advisory services: Institutional development, capacity building, enabling laws and legislation, regulatory analysis and design

 

 

Assignment

​Our review included a meticulous examination of South Africa’s PPP regulatory framework and manual, at the federal and municipal levels. Through this process, our team recommended changes to streamline processes, strengthen institutions and create a more conducive environment for PPP projects.

Services provided

  • Reviewed PPP legal and regulatory framework.

  • Reviewed South Africa’s PPP manual, taking into consideration the sectors that the process applies to, the regulations that impact the manual, and the best practice references.

  • Reviewed municipal PPP framework and guideline, including six modules and three toolkits.

  • Recommended appropriate changes to the framework, PPP manual, and municipal PPP framework and guideline.

  • Consulted stakeholders, including workshops and meetings.

Outcome

CPCS’s study informed GoSA’s procurement reforms at all levels of government. Our report’s recommendations were endorsed and implemented by GoSA with the intention of creating clearer mechanisms for accountability, cooperation and coordination.

New financing instruments will be introduced, including infrastructure bonds and concessional loans. Legislative amendments will also be proposed to create two pathways for PPPs, one for high-value projects and a simplified version for projects valued below ZAR 2 billion.

The amendments will facilitate PPP implementation by fixing regulatory gaps, streamlining institutional relationships across the PPP project cycle, facilitating private sector engagement, strengthening fiscal governance, and boosting a bankable pipeline of transactions to mobilize private capital.

Zoom out: GoSA needed a reliable PPP framework to help meet South Africa’s growing infrastructure demand. Faster growth in capital investment is needed to expand the economy and reduce unemployment and poverty. PPPs were deemed an effective way for public and private sectors to collaborate and deliver better quality infrastructure projects more rapidly, as well as ease pressure on stretched government finances.

Keep learning: Refer to the Budget Documentation for more information on GoSA’s procurement reforms, which were informed by CPCS’s work.

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