The answers to these questions are likely to provide important building blocks towards a more complete assessment of the state of infrastructure in South Africa, its performance, and any need for reform. It would also help frame the ongoing discussion in South Africa in a comparative perspective based on well-defined and widely accepted performance indicators.

The main results suggest the following. Compared to the benchmarks and other country groupings, South Africa’s utilities provide solid service at reasonable quality and, in some cases, very competitive prices. Despite recent gains, however, access remains a major issue in electricity and, especially, in water and sanitation (particularly in rural areas where most of the poor reside), and so does performance in local telecom services. Even transport performance appears comparatively less strong than what would be expected in an upper middle-income, though more in-depth analysis of comparative performance of transport may be warranted to develop a more nuanced picture, especially across different modes of transport. The main policy implication is that there remain significant needs to scale up infrastructure investments––especially in the yet unserved areas––and improve efficiency in all four major infrastructure sectors if South Africa’s infrastructure performance is to catch up with its group of upper middle-income countries.

The organization of the paper is the following. In the next section, we provide a brief overview of the data, the chosen comparators, and caveats. Then, in the following four sections, we present comparative assessments of the infrastructure performance in electricity, water and sanitation, information and communications technology, and transportation. This is followed by a brief section summarizing some of the larger deviations from the comparator groups of countries along with some reflections on policy implications. The final section provides concluding remarks.

# **The benchmarking database**

The data used for comparing South Africa’s performance comes from the World Bank research data base that was recently developed with a specific objective to be used for this type of benchmarking exercise (Eustache and Goicoechea, 2005). The database pulls together the latest available observations from a number of well documented, specialized data sources that contain more detailed data with longitudinal information. The data base aims to measure _sector performance_ by focusing on sector _outcomes_ — **_access, affordability/pricing, and quality_** (technical or perceived). It also provides information on sector institutional reform. Data cover 207 countries (although coverage varies by sector and indicator)<sup>1</sup> with a limited number of variables<sup>2</sup> measuring sector outcomes.

For the purpose of benchmarking South Africa, we compare it with all the world geographical comparator groups--Sub-Saharan Africa, OECD, South Asia, East Asia & Pacific, Middle East & North Africa, Latin America & the Caribbean, Europe and Central Asia, and the world—and four groups of countries clustered by level of income per capita—low income, middle income, upper middle income, and OECD countries. Therefore, both region and income level are used as comparator criteria. The main benchmarking group on which much of the analysis is focused is South Africa’s per capita income group of _upper middle-income countries_ . Because of the strong association between infrastructure and income level, this is economically the most meaningful group comparator for South Africa. This is supplemented by relevant comparisons with other income groups and major regions of the world to provide a wider, geographical comparison of South Africa’s infrastructure performance. Finally, from

> 1 The percentage of available country observations from the total number of countries (207) varies by indicators from close to 90% for measures of access to roads, 85-95% for ICT access and pricing measures, 75-85% for access to water, and 60% for access to electricity.  The quality indicators generally show lower degrees of completeness than those of access.

> 2 The numbers of indicators in each sector are as follows: 7 in energy, 4 in water & sanitation, 12 in ICT, and 12 in transport.

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