Infrastructure projects are indeed attracting private-sector capital, but the main challenge for South Africa is developing a robust pipeline of bankable projects that provide investors with the certainty required to deploy long-term capital at scale.

Infrastructure and energy-related funds attracted 71% of capital raised by private equity funds in 2025, says industry organisation Southern African Venture Capital and Private Equity Association (Savca).

Infrastructure and energy accounted for 40% of overall private equity deal value in 2025, which made it the single largest sector by investment value during the year.

Capital is already flowing into infrastructure opportunities, which reflects growing confidence in the sector's long-term investment potential, says Savca CEO Anusha Naidu.

She emphasises that developing a robust pipeline of bankable infrastructure projects requires a deliberate focus on project preparation, regulatory certainty and institutional capacity.

For investors, this translates into the need for clarity on policy direction, consistency in execution and confidence that projects will move from concept to completion within defined timelines.

Without this, even the most compelling investment narratives struggle to translate into deployed capital, she says.

Infrastructure is increasingly seen as a shared responsibility, requiring the mobilisation of institutional capital, technical expertise and innovative funding models.

Southern African allocators currently direct 42% of their Regulation 28 alternatives exposure to real assets and infrastructure, she points out.

“South Africa benefits from a sophisticated institutional investor base, deep capital markets, experienced fund managers and an increasingly mature private capital ecosystem. These advantages position the country well to continue attracting domestic and international capital into infrastructure projects.”

Additionally, some structural constraints are being addressed, such as reforms in the energy sector changing the conversation from crisis management to system transformation, says Naidu.

Similarly, transmission infrastructure, which has long been recognised as a critical bottleneck, is increasingly being opened up to private participation, which creates new opportunities for investment and enabling additional capacity to come online.

This is a significant structural shift and one that highlights the broader role that private capital can play beyond generation alone, she adds.

“Similar dynamics are evident in other sectors. Ageing water infrastructure assets and governance challenges have constrained delivery, and government is now introducing reforms aimed at improving municipal accountability and creating space for private-sector participation through blended finance and public-private partnerships.”

These developments indicate a gradual but meaningful shift in policy approach, with a clear recognition that infrastructure delivery at scale requires coordinated action between the public and private sectors, Naidu says.

Private capital brings discipline in project selection, governance and execution. It also introduces new financing mechanisms, including private credit and blended finance solutions, to bridge funding gaps and unlock projects that may not fit traditional financing models.

“As infrastructure needs become more complex, investors are increasingly exploring these alternative financing structures. The future of infrastructure finance will require greater collaboration between public institutions, private investors and innovative financing approaches,” Naidu reiterates.

The next phase of South Africa's infrastructure development will be defined by execution, and ensuring that implementation keeps pace with ambition.

“If that can be achieved, infrastructure-led growth will move from ambition to reality, supported by a deepening partnership between the public and private sectors.”