• Financial sustainability of projects funding: The Diagnostic Analysis
highlighted the challenges related to the financial sustainability of project
funding. In order for projects to be successfully funded, it is necessary
that they are financially viable and sustainable. The overall estimates of the
investment programme of the RIDMP are summarised below, however, it
has to be noted that some of the approved projects have not been costed
and therefore have not been accounted for in the summary;
Sector
Energy
Program Description
Energy generation and grid
connections
Transport
Construction and maintenance
ICT
Complete broadband
connectivity
Meteorology Improved equipment,
manpower and expertise
Water
Investment projects and
studies
Tourism
TFCA facilities investment
(TFCAs)
plans
Total
Initial Investment Cost
(US$ million – US$ billion)
290.00 – 420.00
100.00 – 100.00
21.40 – 21.40
0.19 – 0.19
15.41 – 15.41
1.10 – 1.10
428.10 – 558.10
• Partnership with private sector in infrastructure development:
Research studies and, as determined by the RIDMP, public financing of
infrastructure, continues to face challenges owing to fiscal limitations and
competing needs from other urgent socio-economic sectors. In order to
address this challenge, the RIDMP advocates the adoption of joint publicprivate partnership participation in regional infrastructure development.
In practice, some SADC Member States have invited the private sector
to partner with government on investment in infrastructure, either as sole
investors or in the form of PPPs. The RIDMP also recommends that Member
States need to explore the elimination of monopolies and institutionalise
open access options where the services are more amenable to the private
sector; and
• Adoption of the user pays principle: One of the key challenges to
the sustainability and rehabilitation of infrastructure, as observed by
the Diagnostic Analysis of the RIDMP, is the lack of cost-reflective tariffs
application for the usage of infrastructure, which has resulted in limited
resources for maintenance and the dilapidation of infrastructure. In the
case of power projects, this has adversely affected the securing of Power
Purchase Agreements owing to the non-viability of projects operated
on current sub-economic tariffs. If the region is to attract investment, it is
important that it migrates to cost-reflective tariffs across all sectors and that
Member States examine, if necessary, the cushioning of the disadvantaged
through other means that do not prejudice the ability to foster maintenance
to prescribed standards.
Executive Summary
17