Highway aims to tame Wild Coast

2012-12-16 10:00

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Study projects the N2 toll road will create 540 000 jobs over 30 years

The proposed construction of the Wild Coast N2 toll highway will open the poverty-stricken former Transkei area to investment and create 540?000 jobs over a 30-year period.

A study compiled by the South African National Roads Agency Limited (Sanral) suggests the planned highway could, over three decades, inject up to R29.4?billion into businesses and families who live along the route.

The study lists agriculture; forestry; manufacturing; construction and property development; finance and real estate; and trade, tourism and catering as the six sectors to be the major beneficiaries of the toll highway that will cost R9?billion to construct.

Over a three-year construction period, the project is expected to create 6?800 direct jobs.

The report reads: “There is also a high potential to generate up to 21?300 indirect or non-project-related jobs annually during the construction phase, which would result in total employment creation of 28?100 jobs annually during construction.”

Once completed, it is projected the highway will help create a further 18?000 jobs annually for 30 years in the six sectors.

The toll road was given the green light by the environmental affairs department last year following opposition to it from environmental groups, who claim it would permanently damage the Wild Coast’s sensitive ecological system.

The proposed toll road would stretch from the Isipingo interchange near Durban in KwaZulu-Natal to the Gonubie interchange near East London in Eastern Cape.

The stretch would be about 560km and would connect major centres such as East London, Butterworth, Idutywa, Mthatha, Ndwalane, Lusikisiki, Port Edward, Port Shepstone and Durban.

The new route would be about 75km shorter than the existing N2 route via Kokstad, Harding, Mount Frere and Qumbu. Six toll plazas will be erected along the highway, of which four will be in Eastern Cape.

At this stage, Sanral has not shed light on how it planned to fund the project or when construction will start, and did not respond to City Press’ requests for more details.

Potential investors are also in the dark as to how the project will be funded.

Orville Cachia, the investment director at Harith General Partners, which manages a $630?million fund that invests in infrastructure across Africa, told City Press there was no clarity on whether Sanral was going to issue bonds to fund the project or whether it would simply do a public-private-partnership (PPP) transaction.

Cachia said: “Obviously we would like to get clarity from Sanral if it will fund the project on its balance sheet like it did with the Gauteng Toll highways or if it is going to do a PPP similar to the Maputo Corridor.”

Absa property analyst Jacques du Toit said the construction would open the “beautiful” Wild Coast to tourists, who are not able to access the area due to a lack of or poor infrastructure.

He said the coastal town of Port St. Johns, one of the towns the highway will pass through, had the potential to develop into another Knysna or Plettenberg Bay, the upmarket holiday and residential towns along the N2 between Port Elizabeth and Cape Town.

Du Toit said: “The influx of tourists will happen, but it will take time for Port St. Johns to develop to the level of Knysna and Plettenberg Bay. The construction of the highway will be a big step in the right direction.”

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