Infrastructure spending gains momentum

johannesburg - spending on economic infrastructure is gathering momentum. public corporations set the pace with a rise of more than 40 percent in capital formation in the fourth quarter from 24.5 percent in the third.

the figure is a quarterly change, which has been seasonally adjusted and annualised.

"the electricity sector increased real capital outlays… the transport sector increased investment to replace rolling stock. in addition, capital expenditure was stepped up at several airports to accommodate the rising numbers of travellers," according to the reserve bank's quarterly bulletin.

spending on capital projects rose 15.5 percent in the fourth quarter from 13 percent in the third. the central bank attributes the fourth-quarter growth to "strongly rising capital outlays by the mining, manufacturing, construction and commerce sectors".

"projects to expand mining production continued notably in the mining of iron ore. and real capital formation in the manufacturing sector continued to rise as manufacturers prepared for further demand pressure arising from the planned infrastructural investment," the central bank said.

government spending rose 13 percent in the fourth quarter after rising 11.5 percent in the third.

"all tiers of government increased their real capital investment, gearing up to address infrastructure backlogs," said the bank.

overall growth in capital spending increased from 13.5 percent in the third quarter to 16.5 percent in the fourth.