SOUTH AFRICA (Commonwealth Union) – There has been quite the ado at the South African National Roads Agency (SANRAL). The uproar was caused when tenders that were previously awarded were then canceled by the agency. Of course, there is a plausible reasoning behind this and one can only assume that it was for legal or political reasons.
It seems that the construction industry in South Africa is not what it was 10 years ago. The industry has itself shrunk and this is largely due to the fact that the there has been a huge decline in infrastructure spending made by the state. Just between the years of 2018 and 2022 SANRAL has not even spent half of the government grants to improve or rebuild new roads or any other development. So, this has been the reason for the decline of the industry.
Now there were five tenders that were awarded in June this year to local construction companies to begin building new roads. Out of the five, three were canalled without a proper reason, so the media along with the companies assumed it had to do with the funds. However, then in an absolute turn around, the SANRAL gave those tenders to China.
The relationship between South Africa and China has always been a good one. There has rarely been any bad blood as both countries, which have worked together many times for the same purpose. Against this backdrop, it seems that earlier this year in June there were some tenders awarded to China to do many roads construction in South Africa. This didn’t appear unnatural as many of these contracts had been awarded to China by the South African Government. When researching the topic one can see that China has undertaken many projects like this all over the world and always delivered brilliant products.
This was a shocking turn of events for the construction companies as they were initally awarded the tenders then they were cancelled without any notice. The cancelled tenders were worth about R17.4 billion. This is a lot of money and could probably get the companies out of whatever rut they were in financially in and also help the industry possibly expand a little.
There is still no official reason given from any of the parties involved. There are rumors stating that the Chinese companies are better equipped to handle such big projects. If that is the case the, SANRAL made a good decision based on just that fact alone.
