About
The Infrastructure Fund (IF) was established through a tripartite Memorandum of Agreement between the Development Bank of Southern Africa (DBSA), National Treasury (NT), and the Department of Public Works and Infrastructure (DPWI) through Infrastructure South Africa (ISA). The IF is operationalised by the DBSA as a ring-fenced unit within the Bank and Infrastructure South Africa provides oversight of the Fund.
Mandate
The IF is mandated to create blended finance solutions to significantly crowd in private sector investment in the implementation of infrastructure projects and programmes in South Africa, thus contributing to increased gross fixed capital formation. The fund aims to improve the commercial viability of public infrastructure projects in South Africa by providing blended finance solutions and co-financing mechanisms, alleviating pressure on the fiscus by attracting private investment.
Blended finance model
In line with international best practice, the IF blended finance model is developed with reference to the Organisation for Economic Co-operation and Development (OECD) and the Global Environment Facility (GEF) models.
Progress to date
Since its inception, the IF has packaged a total of 26 approved blended finance infrastructure projects/programmes, with a capital value of R102 billion across several sectors, including water and sanitation, human settlements, transport, health and energy. Further, the Budget Facility for Infrastructure (BFI) has to date approved R37.5 billion of aggregated capital costs of these projects/programmes, out of the R100 billion provisionally allocated to the IF over a10-year period.
Development impact
The approved IF projects have a massive development impact, with an estimated 381395 megalitres of water delivered per annum under the water and sanitation projects, 35496 units delivered in the human settlements sector and 9500 beds anticipated to be completed in the current phase of the student accommodation programme.
