Hon Deputy Speaker, in keeping with the vision of greater regional integration on the continent, we welcome the extension of the operations of this Bank to any national territory in Africa or its associated oceanic islands.
Development finance institutions, DFIs, play a key role in the facilitation of the flow of capital and foster greater economic growth and sustainable development, and must form a substantive part of our financial development arsenal. Whilst Africa is currently still ranked lower in the portfolio spreads of larger DFIs, it is growing in prominence as an investment destination.
The Development Bank of Southern Africa, DBSA, focuses on the development of key infrastructure sectors, such as water, sanitation, energy, transport, education and health. This is mainly achieved via the conduits of municipalities, state-owned companies, SOEs, independent power producers and public-private partnerships.
The problem inherent within these conduit channels are hindering in the extreme. Infrastructure development and maintenance through local government and state-owned companies remain a hit-and-miss affair.
Maladministration, incompetence and outright fraud and corruption in the supply chain management of these entities have rendered their outputs way below par. How will the DBSA counter such waste and mismanagement of funds? What greater form of oversight and accountability will be levied on the DBSA loans? These are the questions that we need to be asking ourselves.
The Bill envisages the Minister being able to initiate regulations without having to be requested by shareholders of the board to do so, and to unilaterally determine which other African countries outside the Southern African Development Countries, SADC, the DBSA may operate in.
What if one of these countries defaults on a loan? What risk-control measures are in place? Are they adequate? These are the questions we again need to ask.
Besides this Bill extending the bank's operations to other African countries beyond SADC, it also seeks to increase the authorised share capital of the DBSA to R20,2 billion. Furthermore, the Bill seeks to enable further increases to address the growing demand for infrastructure funding and enhance the Bank's capital base.
What checks and balances are in place to ensure that this money, if utilised, is put into sound investments? That is another question. The IFP supports this Bill, but would actually like the House to note all the concerns that we have raised. I thank you.