Benefits of freeway investment through innovative procurement

Abstract

South Africa’s pressing development challenges include an ageing road network and sharp growth in road traffic. The construction of adequate transport infrastructure, and the capital investment required to fund it sustainably, are prerequisites for social and economic development. Furthermore, there is a legal and moral obligation to spread the economic benefits of such investment to smaller firms and historically disadvantaged South Africans. In 2008, the South African National Roads Agency Ltd launched the Gauteng freeway improvement project, covering 560 km of roads. The first 185 km of roads include the construction of additional lanes, reconfiguring interchanges and the introduction of a multi-lane free flow electronic toll collection system, all to be financed through capital borrowings and toll income. This paper will discuss innovations in the procurement of the civil works that enabled the involvement of firms owned by black South Africans and prevented the consolidation of large firms in joint ventures.