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• Create Date March 20, 2024
• Last Updated March 26, 2024

Estimated Civil Tender Values: February 2024

After a slow start to the year, civil tender activity rebound in February, as the estimated value of tenders released during the month increased by 78 percent y-y.  A slow start in January 2024 means overall tender values rose 8.8 percent y-y for the first two months of 2024.  Considering the current water crisis faced by South Africa, there seems to have been a shift towards higher value water projects released to tender. Water higher value (CIDB Grade 9) project represented 50 percent of these higher grade projects to tender, and as a result the tender values for water projects more than doubled in February 2024 but remains moderately lower compared to the same two months in 2023.  It was a better month for majority of the provinces, with the strongest increase reported in Kwazulu Natal for the month, followed by Limpopo where tender values rose by more than R1bn to RR2.4bn (February 2024).  The pace of awards, particularly in the CIDB Grade 9 projects, is slow, resulting in the value of awards under performing against tender activity, and was still 24 percent y-y lower in the first two months of 2023 (current prices). Encouraged by the improvement in tender activity in February, it doesn't distract from the concerning increase in the number of projects that were cancelled during the first two months. It remains to be seen if the positive momentum in February will continue, as the 2023/24 financial years come to a close for provincial and local governments. The outlook for 2024/25 in terms of government infrastructure expenditure is less positive with budgetary allocations reduced for the 2024/25 financial year, across most market segments, except for energy and water infrastructure.

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