SA’s largest black-owned and managed industrial equipment supplier responds to SONA 2022
11 February 2022: The biggest opportunity for the construction industry lies in road and related infrastructure projects, comments Shumani Industrial Equipment MD Victor Nemukula. This is in line with the declaration by President Cyril Ramaphosa in his State of the Nation address on 10 February that “infrastructure is central to our economic reconstruction and recovery.”
“We have prioritised infrastructure projects to support economic growth and better livelihoods, especially in energy, roads and water management through innovative funding and improved technical capabilities,” said Ramaphosa.
The Infrastructure Fund is at the centre of this effort, with a R100 billion allocation from the fiscus over the next decade. Government will make an initial investment of R1.8 billion in bulk infrastructure to unlock seven private sector projects worth R133 billion.
However, Nemukula adds a caveat: “We still need to rebuild the damage caused by the unrest and looting in KwaZulu-Natal and certain parts of Gauteng in mid-July last year. The industry is currently recovering slowly and is not in the state it was before the Covid-19 pandemic.
“There are a lot of government infrastructure projects that went out on tender, but no contractors have been awarded the work yet, so these projects are still on hold. This has had a negative impact on construction equipment sales, as construction companies are not willing to make capital investment decisions when they do not know when their next job will come,” stresses Nemukula.
“I believe the road to recovery is a long one. Most of the infrastructure projects are dependent on government funding, and government seems to be prioritising Covid-19 relief schemes and unemployment grants ahead of infrastructure projects,” he adds.
Shumani is the largest black-owned and managed industrial equipment supplier in South Africa. “All of this mooted infrastructure development will require capital equipment, so one can expect the demand for capital equipment to increase.”
Nemukula reveals that Shumani has quoted various municipalities for road construction and maintenance projects. “However, once again its currently a waiting game for the government to award the tenders and give the go ahead for work to start,” he concludes.