Digital Transformation - Public Sector Success Stories

Progress on Infrastructure, Digital Transformation, Localisation and Procurement Reform

By Jessie Taylor

As South Africa navigates its post-2024 general election era, the public sector has made tangible strides in key priority areas: infrastructure development, digital transformation, localisation, and procurement reform. These efforts reflect a growing commitment to inclusive economic recovery, enhanced service delivery, and institutional integrity.

Among just some of the exciting projects showcasing progress is the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP). Since its inception, 123 projects delivering 6,200 MW of clean energy have been contracted, reinvigorating the green economy and attracting private investment pivotal to the energy transition. Another example includes the RFI launched by Transnet in early 2025, expected to translate into full RFPs by August, opening major freight infrastructure investments to private firms and rehabilitating key corridors between Limpopo, Mpumalanga, Richards Bay and Saldanha Bay.

Infrastructure Development

At the 2025 Sustainable Infrastructure Development Symposium (SIDSSA), President Cyril Ramaphosa reaffirmed infrastructure’s role as “the flywheel of economic progress,” signalling an intensified drive to implement Strategic Integrated Projects (SIPs) in energy, transport, and social sectors. These SIPs are designed to catalyse job creation, boost connectivity, and support long-term development objectives.

New infrastructure investments surged to R445-billion in 2024 - double the previous year - with over 78% of that spending coming from government and state-owned entities. Significant international financing has further amplified local momentum. In June 2025, the World Bank approved a $1.5-billion loan focused on revitalising rail, ports, and energy systems to remove economic bottlenecks. Complementing this, the African Development Bank committed $475-million to targeted upgrades in logistics and energy access.

Transnet and the Department of Transport also issued a Request for Information (RFI) to attract private sector interest in modernising bulk mineral export routes. These investments are expected to increase freight volumes, reduce logistical costs, and spur industrial activity around port cities - laying a stronger foundation for future economic resilience.

Digital Transformation

South Africa’s rise in the United Nations e-Government Development Index - from 65th in 2022 to 40th in 2024 - marks a turning point in state digitalisation. Public services are increasingly accessible online, with 134 of the 255 targeted services now live on the National e-Government Portal. This includes platforms for social grants, visa applications, and SARS tax submissions, all designed to reduce administrative burdens and ensure service equity.

The opening of Visa’s first African data centre in Johannesburg has enhanced digital infrastructure and improved local financial processing speeds. This not only reduces reliance on overseas data centres but also enhances cybersecurity and data sovereignty. Moreover, public cloud and mobile service expansion are helping bridge the digital divide in rural provinces.

Trust in digital governance is growing as the government streamlines IT procurement, negotiates favourable licensing terms, and implements data protection laws. A digitally transformed public service can reduce inefficiencies, eliminate ghost beneficiaries, and enhance transparency—ultimately making the government more responsive and accountable to citizens.

Localisation

The public sector’s renewed focus on localisation is evident in the Inclusive Procurement Scheme 2025, which mandates that 40% of all government contracts be allocated to enterprises owned by women, youth, and persons with disabilities. This inclusive approach addresses historic inequalities and stimulates local economies by giving SMEs meaningful access to state contracts.

This localisation agenda is bolstered by the Preferential Procurement Policy Framework Act and BroadBased Black Economic Empowerment (BBBEE) guidelines, reinforcing supplier diversity and incentivising mentorship, training, and technology transfers. Localisation becomes an engine for entrepreneurship and long-term capability development by tying government contracts to social outcomes.

Moreover, designated sectors - such as steel, textiles, and rail rolling stock—have introduced more structured localisation thresholds. By enforcing local content requirements, government procurement simultaneously grows domestic manufacturing and reduces dependence on imported goods. This is particularly relevant in strategic sectors that align with the Presidential Industrial Policy and Master Plans, positioning public procurement as a lever for national reindustrialisation.

Procurement Reform

South Africa’s procurement system has historically faced criticism for inefficiencies, delays, and vulnerability to corruption. But significant reform is underway. The Central Supplier Database (CSD), launched in 2015, continues to serve as a unified platform for supplier vetting, helping to eliminate fraudulent vendors and streamline the bidding process. The database currently hosts over 1.2 million registered suppliers, and recent upgrades now enable real-time compliance verification and tender status tracking.

The Procurement Act 28 of 2024 introduces modern regulatory frameworks aimed at curbing maladministration and making tender processes more transparent and accountable. The Act mandates open contracting data standards (OCDS), stricter audit trails, and automatic blacklisting for firms that breach compliance. Importantly, the Act also supports early contractor engagement, encouraging competitive and timely project delivery.

In practice, this reform has already started to bear fruit. In Limpopo, pilot evaluations of digitised procurement systems show faster turnaround times, fewer irregularities, and higher local contractor participation. These efforts dovetail with National Treasury’s broader goal of enabling infrastructure-led growth through a procurement system that balances speed, oversight, and inclusion.

After one transformative year under the Government of National Unity, South Africa’s public sector demonstrates clear momentum across its strategic priorities. Infrastructure projects are progressing with multilateral and private-sector partnerships; digital services are expanding access while reinforcing institutional resilience; localisation initiatives are unlocking market entry for historically excluded groups; and procurement reform is enhancing transparency and delivery efficiency.

The strategic direction is clear and cross-sector collaboration, policy coherence, and increased investment in institutional capability will be essential to maintain this trajectory.

In the years ahead, South Africa’s ability to align public investments with national priorities will determine whether it can realise its full developmental potential. With foundations now firmly being laid, the outlook for a more inclusive, transparent, and capable state is increasingly positive.

Source: SONA | AP News | Nedbank Infrastructure Investment Report | Reuters | Wits University | Government of South Africa | Statistics South Africa | United Nations | E-Government Survey 2024 | UN e-Government Country Data | National Treasury | Corruption Watch