A Province you can Invest in
Good morning,
Members of the Provincial Executive,
Members of the Diplomatic Corps,
Heads of Departments,
Mayors,
Academia,
Leaders of the finance and banking sector,
Introduction
Your presence here today speaks to the urgency of our shared task, which is to secure the Western Cape’s future when fiscal growth does not keep pace with population growth.
South Africa’s economy saw sluggish growth at 0.6% growth last year, and our projections for 2025 offer little optimism for a quick recovery. Just last week, the International Monetary Fund released their latest growth projections indicating that South Africa’s growth estimate for 2025 now stands at a nearly negligible 1 per cent. This is in line with Provincial Treasury projections of 0.8 per cent for the national economy in 2025.
Yet, here in the Western Cape the story is different. People continue to migrate to our province, driven by hope, opportunity, and the promise of a brighter future. While more and more people call our province home, each arrival rightly expects safe roads, affordable homes, reliable electricity, clean water, and quality education and healthcare.
But we must be frank with one another. The economy is not growing fast enough to bridge every funding gap we face to build infrastructure and improve and expand access to social services. Our provincial budget is already stretched across competing priorities. We are increasingly realising that we cannot single-handedly deliver the economic-, digital-, energy-, social-, and ecological- infrastructure that our society and aspirations demand. Relying solely on traditional public finance is not an option anymore and it is a constraint we must move beyond.
That is why, today, we are excited and proud to launch the Western Cape Government’s new Alternative & Blended Finance (ABF) Framework.
This document is a blueprint that will enable us to leverage our good governance, stable provincial fiscus by leveraging public funds with innovative private and commercial finance mechanisms, and/or philanthropic capital, in order to realise the objectives of our 2025-2030 Provincial Strategic Plan, our 2050 Western Cape Infrastructure Framework, and 2023-2035 Growth for Jobs Strategy.
Through the ABF Framework we will be able to mobilise the resources needed to unlock strategic infrastructure projects, deliver measurable social outcomes, grow our economy and create jobs, whilst protecting a balance sheet that keeps investors on board. No shortcuts, no gimmicks, simply a smarter and more innovative way to fund what matters.
Having established a clear need for new solutions, our focus now turns to how they will function to deliver meaningful results.
Vision of the ABF Policy Framework
The ABF framework fundamentally reforms how we approach private, commercial, development and/or philanthropic funding. Its core vision is to transform collaboration into capital, and over our term it will open fresh channels for investment that will expand infrastructure and service delivery, all while ensuring every rand spent is carefully accounted for.
Public funds will serve as catalytic capital that will be leveraged to strategically lower investment risks and render sizable projects attractive and viable. With the right financial structures in place, the aim is to ensure every rand of provincial funding can leverage additional resources from the market to enable projects, using both on- and off balance sheet instruments. Whilst complying with Constitutional provisions, legislative requirements, and National Treasury regulations, this Framework aims to foster confidence among stakeholders that the WCG’s blended finance activities are lawful, just, and fiscally prudent.
We have prioritised five Key Sectors for potential investment - economic, digital, energy, social and ecological. Each was selected specifically for its powerful multiplier effects on economic growth and job creation.
We will further inform our decision-making process through the Guiding Principles of additionality, policy alignment and holistic impact, result orientation, accountability, fiscal sustainability, legal compliance, transparency, integrity and fairness, collaboration, and capacity development.
A Province you can invest in
Trust is the bedrock of all sound investment. To realise our vision for mobilising capital on an unprecedented scale, this document rests securely on clear legal and strategic principles.
Every transaction undertaken within this framework will fit squarely within the Public Finance Management Act (PFMA) and the Borrowing Powers of Provincial Governments Act and maintains oversight by the National Treasury. This guarantees that all associated loans, guarantees and partnerships remain lawful, transparent, and fully accountable, and thereby safeguards both public money and private confidence.
Clear lines of responsibility are essential for turning strategy into tangible results. To achieve this, distinct roles are assigned.
The ABF Framework outlines in detail the Project Preparation and Approval Processes departments need to follow for on-balance sheet instruments and its integration with the Provincial Budget Process and the Infrastructure Delivery Management Stage (IDMS) Gates.
We will establish a Provincial Loans Coordinating Committee (PLCC), to review and recommend projects to our Provincial Cabinet for approval, and ultimately the National Loans Coordinating Committee (NLCC). Our PLCC will consist of our Premier, Minister of Finance and Minister of Local Government, and chaired by myself as the provincial Executive Authority for Finance.
The PLCC is tasked with vetting funding terms and monitoring aggregate debt levels, and line departments will shape projects and carry them to close. Provincial Treasury will provide crucial central oversight. We will act as the single point of control for establishing standards to ensure consistent reporting and manage portfolio-level risk.
We will further establish a Technical Provincial Loans Coordinating Committee to advise the committee by screening and assessing proposed projects that are technically compliant to serve before the PLCC. Finally, all ABF on- and off balance sheet instruments will be reported on to our Innovation, Culture, and Governance Cabinet Sub-Committee as well as through respective financial documentation.
Where a project involves a municipality, our Department of Local Government will coordinate to ensure Municipal Finance Management Act (MFMA) and local council compliance.
The Western Cape Government’s established good governance record, positive bank balance, debt-free books, 100 per cent clean audits, and quality financial statements gives us a clear edge and is the platform upon which swift, high‑impact action can proceed without delay or doubt.
We already have world-class infrastructure, effective local and provincial governments, a growing provincial economy and stable provincial government.
Therefore the Western Cape Government is a Province you can Invest in!
Building an investment-ready pipeline
Ladies and gentlemen, a clear plan fails without projects ready to break ground.
In conjunction with our Western Cape Infrastructure Framework, the ABF Framework will maintain a rolling pipeline across our identified priorities. We thank our colleagues in the Department of Infrastructure for finalising our infrastructure pipeline for our government and we look forward to being an enabling and reliable partner.
Through our Infrastructure Framework, the Western Cape thus will always remain ready with bankable and shovel-ready projects for lenders, DFIs, and industry leaders in finance and banking.
Versatile financing tools
Realising our ambitious pipeline of projects requires the right financing tools, which must be carefully matched to project scale, risk, and expected returns.
Firstly, our toolkit includes potential instruments such as public-private partnerships, project finance, and outcomes-based contracts like social impact bonds. Employing these structures would allow fiscal flexibility.
When direct financing aligns better with our goals, we turn to potential concessional loans from development finance institutions or issuance of provincial bonds (always with approval from National Treasury). These have the potential to finance essential long-term assets that directly support our core policy objectives.
Our choice of financing instrument will be context-appropriate. For instance, a utility-scale solar plant might utilise project finance involving private equity and debt, whereas an early-childhood development programme could rely on a social impact bond where payments are tied directly to achieving proven results. Regardless of the structure chosen, every approach respects fiscal ceilings and is designed to secure value for money.
Proof of this approach's success already exists. The City of Cape Town's Green Bond, for example, channelled R1 billion rand into vital water and energy projects using similar principles. We've also seen how the Gautrain public-private partnership fundamentally reshaped commuter transport in Johannesburg. Here in the Western Cape, our own Impact Bond Innovation Fund has improved early learning outcomes by orders of magnitude.
Managing such a diverse range of instruments naturally demands rigorous oversight. Our ABF framework ensures every commitment is tracked, risks are clearly defined and controlled, and performance is transparently reported to give both investors and residents full confidence in every rand spent.
Safeguarding fiscal stability
Ladies and gentlemen, sound financial management is what underpins bold ideas. As we have done in the past, the Western Cape Government will ensure that each contract is structured such that risk is allocated appropriately.
Before approval, each project will undergo a thorough affordability check, confirming that savings, tariffs, or allocated budget funds can comfortably cover costs throughout its lifespan.
These checks rest on strong institutions and audited reporting, and once again, reassures investors and residents alike that there does not have to be a trade-off between financial innovation and our fiscal integrity. In fact, we are the only provincial government in South Africa that can boast with 100 per cent clean audits across its departments and entities, as at the 2023/24 financial year.
The road ahead and next steps
The immediate next step involves launching pilot projects designed to test these new financing instruments in practice. Initially, these pilots could span multiple sectors, enabling us to quickly learn, adapt, and sharpen our approach based on real-world results.
We know finance evolves rapidly, and flexibility is essential. That’s why we encourage your ongoing input and feedback. Potential investors, residents and our colleagues within the Finance family nationally and locally are invited to engage with this framework, recommend improvements, suggest innovative tools, and co-design adaptable solutions.
Together, we can ensure the Framework continues to turn financial innovation into tangible results for residents across the province.
The Western Cape Government is open for business
Today is a big moment for the Provincial Treasury - we made a commitment in our own budget vote to shift towards a revenue-focussed Treasury. The cabinet adoption of this ABF Framework as a roadmap for our government is therefore a momentous step for us as we move from planning to action. The framework sets the stage for real investment, tangible projects, and measurable outcomes. It offers hope amidst uncertain and unprecedented times.
We are not sitting waiting around for someone to come save us - we are a Province you can Invest in, so we will save ourselves. It affords us the opportunity to open fresh lines of finance, give the Western Cape the means to build, to grow, and to serve its people better than ever before.
I thank the Premier, my Cabinet colleagues for their support and confidence in our Treasury, our Director-General and every official of our government who contributed input and feedback into this Framework, and our trusted provincial Treasurers who have drafted this Framework to enable our government to move from talk to transaction.
Ladies and Gentleman, the Western Cape Government is a Province you can Invest in, and we are open for business!
Let’s get to work.
I thank you.