Capital Expenditure Project Listing
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CAPITAL EXPENDITURE PROJECT LISTING 1 January 1993 to 31 December 2015 NEDBANK GROUP ECONOMIC UNIT 16 March 2016 Comment: mixed-use development in Sedibeng worth R4,0 billion, the Menlyn Maine development precinct in The year 2015 was one of the most difficult for the South African economy, with weak global and Pretoria, worth R1,8 billion, and the final phase of the luxurious Umhlanga Pearl Sky in Durban, worth local demand, historically low global commodity prices, loadshedding, a sharp depreciation of the R1,3 billion. rand, as well as rising input costs, among other factors, weighing negatively on economic activity. These also hurt both consumer and business confidence. Although firms remained very cautious The transport, storage and communication sector announced 21 projects accounting for 25% of of committing to large-capacity expansion programmes, there was some improvement in capital the total and amounting to R21,3 billion, up from R8,9 billion in 2014. Most of the projects in this expenditure plans. Nedbank's Capital Expenditure Project Listing shows an increase in both sector involve the rehabilitation and construction of roads. The biggest project recorded in the second the number and value of projects announced in 2015. The projects amounted to R152,4 billion, up half was the Maluti-A-Phofung special economic zone (SEZ), worth R4,8 billion, which involves the from R58,6 billion in 2014. construction of a new 1 000 ha SEZ near Harrismith, which will provide road and rail logistics. It will Nedbank schedule: R billion (constant 2015 prices) Actual growth in capital formation % also act as a handling facility for the Gauteng–Durban port corridor and link it to the Bloemfontein– 1000 20 Cape Town corridor. The project will be undertaken by the Free State Development Corporation. Public sector Another major project, worth R2,2 billion, involves the construction, maintenance and rehabilitation of 900 Private sector Actual growth gross fixed capital formation some national and regional roads in the Eastern Cape by Sanral. 15 800 The manufacturing sector also showed some improvement in 2015, with 15 projects announced 700 worth R20 billion, up from R9,9 billion in 2014. The biggest project recorded is BMW's plan to spend 10 R6,0 billion to upgrade its Rosslyn plant in preparation for the production of the new-generation X3 600 model, followed by VWSA's investment plan, worth R4,5 billion, which involves the expansion of its 500 5 Uitenhage plant to produce two new models and increase the plant's capacity from 120 000 to 150 000 cars a year. Petra Diamonds is building a processing plant worth R1,7 billion, in Cullinan with 400 capacity of 6 million tonnes a year. 0 300 The electricity, gas and water sector announced eight new projects worth R51,2 billion. The value 200 was pushed up mainly by projects related to the Department of Energy's fourth round of the -5 Renewable Energy Independent Power Producer Procurement Programme worth R23 billion, as well 100 as Air Liquide's new air separation unit, worth R2,6 billion, in Secunda. Both of these were reported during the first half of 2015. The biggest project recorded in the second half was the KiPower 0 -10 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 independent power plant, worth R24,3 billion, a new 600 megawatt coal-fired power station in Delmas, Mpumalanga. All three major sectors recorded an increase in the number of projects compared to 2014. The The community, social and personal services sector announced eight projects worth R12,1 billion, private sector and public corporations also recorded an increase in the value of projects, while a down from R13,0 billion in 2014. Most of the projects (worth R11,2 billion) were recorded during the moderation in the value of projects was recorded in the government sector. The private sector first half of the year. The biggest project of the second half of the year is a mixed-used development remained the main source of project announcements, with 56 new projects accounting for 67% of worth R1,0 billion in Roodepoort, which will consist of more than 4 000 houses, a sports field, a the total number of projects. In value terms the projects amounted to R131,1 billion or 86% of the church, a crèche, a primary school and a multipurpose centre undertaken by the Department of total value. General government and public corporations announced 18 and 10 new projects Human Settlements and the City of Johannesburg. There were also a number of other mixed-use respectively, worth R10,7 billion and R10,6 billion. There was a pickup in the number and value of developments recorded in the first half of the year, as well as plans to develop infrastructure in tertiary large and medium projects following a reduction in 2014. institutions across the country. The breakdown shows that the finance, real estate and business services sector contributed The mining sector announced fewer new projects (four), but the value rose to R18,7 billion from the highest number of projects, with the 22 projects classified in this category accounting for 26% R8,0 billion in 2014, boosted by the Palabora Copper's Lift 2 project, worth R9,3 billion, which was of the total number of projects and amounting to R26,8 billion, up from R12,8 billion in 2014. Most recorded during the first half of the year and involves the rampup of the Palabora Copper mine in of the projects were recorded in the first half of the year. The majority of projects in this category Limpopo to extend its life to 2033. The biggest project recorded during the second half of the year is involve mixed-use and housing developments, as well as shopping malls and offices. The biggest Vedanta Resources' Gamsberg zinc mine project, worth R8,7 billion, which involves building a 4- project recorded during the second half was the Rainbow Mall, worth R2,5 billion, to be built in million tonnes a year open-pit mine with a processing plant that will process the ore into concentrate Pretoria. This 94 000 m² regional shopping centre will be developed by Retail Network Services and have an expected life of 13 years. and Rainbow Junction Development Company, and is part of the upcoming multibillion Rainbow Junction mixed-use development. Detailed information about it is not yet available, so it is not yet The wholesale, retail and motor trade, hotels and accommodation and the agriculture, forestry included in the statistics. Other projects include the R1,1 billion expansion of the Pavilion and fishing sectors also announced fewer projects, worth a total of R2,4 billion, while the Shopping Centre in Durban and the R1,2 billion Yatch Club mixed-use development in Cape construction sector announced no new projects. Town. Some of the major projects recorded during the first half include Steyn City Properties' Steyn City Lifestyle Resort in Fourways, Johannesburg, worth R6,5 billion, the Vaal River City The outlook for 2016 is very uncertain, with weak economic growth of only 0,2% projected on the back of weak demand both locally and abroad. This, together with falling commodity prices, rising input costs and infrastructure constraints, will weigh on business confidence and dissuade private sector investment. There are also risks that some of the projects already announced may be delayed or even scrapped given the challenging economic conditions. Government infrastructure programmes will continue as government attempts to create employment and address some of the social and infrastructure backlogs. However, the pace will be slow given budgetary and other constraints. Therefore, capital formation will probably remain weak in 2016 and 2017. SUMMARY TABLE 1: ANNOUNCED PROJECTS IN EACH YEAR - CURRENT PRICES TOTAL CAPEX BY TYPE OF ORGANISATION CAPEX BY SIZE OF THE PROJECT Number of projects by: Total value of projects by: Number of: Total value of: Total value of Total number Private General Public Private General Public Small Medium Large Small Medium Large announced of announced sector government corporations sector government corporations projects projects projects projects projects projects projects projects (R million) (R million) (R million) (R million) (R million) (R million) (R million) 1993 48649 165 99 39 27 31669 10253 6727 51 72 42 1648 7674 39327 1994 23502 124 83 31 10 15896 5593 2013 47 51 26 1597 5949 15956 1995 76693 159 99 38 22 25977 6119 44597 43 68 48 1519 7235 67939 1996 92086 217 164 28 25 47377 4958 39751 75 83 59 2417 10618 79051 1997 59671 179 115 38 26 24739 27653 7279 59 69 51 1930 8556 49185 1998 40179 190 116 48 26 29848 7066 3265 81 73 36 2666 8057 29456 1999 21579 101 66 27 8 17263 2528 1788 42 37 22 1196 3758 16625 2000 102157 109 67 32 10 36877 9605 55675 50 36 23 1814 4181 96162 2001 26743 83 51 23 9 14646 10763 1334 22 32 29 757 3521 22465 2002 76603 72 46 15 11 29011 29933 17659 12 29 31 405 3633 72565 2003 37588 62 40 13 9 25019 10073 2496 10 23 29 324 2925 34339 2004 54192 60 44 5 11 40665 4290 9237 5 27 28 175 3566 50451 2005 196826 102 84 9 9 119444 36038 41344 12 22 68 507 3435 192884 2006 520035 135 97 27 11 162896 73767 283372 12 23 100 515 2981 516539 2007 288746 125 91 28 6 111705 33287 143754 11 43 71 340 5353 283053 2008 184015 107 85 19 3 125474 53091 5450 9 26 72 296 3461 180258 2009 99499 59 46 13 0 74740 24759 0 6 20 33 189 3850 95460 2010 67461 57 43 6 8 51837 4224 11400 5 18 34 180 2367 64914 2011 248737 68 56 9 3 70860 22077 155800 1 15 52 24 2196 246517 2012 422886 99 71 26 2 77101 33785 312000 10 28 61 355 4083 418448 2013 209106 92 70 12