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Assessing the impact of Transnet's and Eskom's infrastructure investment programmes on the capital goods sector

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  • Marian Lydall

Abstract

Transnet and Eskom have embarked on a R160.8 billion capital expenditure (capex) programme to improve South Africa's logistics and energy infrastructure over the next 5 years. Although considerable backward linkages will be created in the process of procuring goods and services needed in the construction and operation of the planned projects, a significant portion of investment will be lost because of having to import foreign skills and components that are unavailable locally. It has thus become a government priority to increase local content in the procurement process. Drawing on a series of interviews with leading suppliers involved in the capex programme, this article assesses the impact of such expenditure on the domestic capital goods sector and the constraints that militate against increased local participation.

Suggested Citation

  • Marian Lydall, 2009. "Assessing the impact of Transnet's and Eskom's infrastructure investment programmes on the capital goods sector," Development Southern Africa, Taylor & Francis Journals, vol. 26(3), pages 429-446.
  • Handle: RePEc:taf:deveza:v:26:y:2009:i:3:p:429-446
    DOI: 10.1080/03768350903086812
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    References listed on IDEAS

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    1. Tahir A. Abdi, "undated". "Machinery & Equipment Investment and Growth: Evidence from the Canadian Manufacturing Sector," Working Papers-Department of Finance Canada 2004-04, Department of Finance Canada.
    2. Vuori, Synnöve & Ylä-Anttila, Pekka, 1992. "Industrial Transformation in Finland - From Factor Driven toTechnology-Based Growth," Discussion Papers 413, The Research Institute of the Finnish Economy.
    3. Sanjaya Lall, 2001. "National strategies for technology adoption in the industrial sector: Lessons of recent experience in the developing regions," Human Development Occasional Papers (1992-2007) HDOCPA-2001-08, Human Development Report Office (HDRO), United Nations Development Programme (UNDP).
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