Operation Vulindlela Phase II is a joint initiative of the Presidency and National Treasury to accelerate the implementation of priority structural reforms. These support economic growth, improve service delivery, and strengthen state capability. There are seven reform focus areas.

Challenging times The National Treasury said that despite a challenging global economic environment, strong and sustained progress in implementing growth-enhancing structural reforms has lifted. The reforms currently underway aim to reduce input costs, improve competitiveness, and create opportunities for private investment in key sectors of the economy. This is reflected in the South African Chamber of Commerce and Industry Business Confidence Index, which in the first quarter 2026 reached its highest level in more than a decade.

Electricity sector During the first quarter 2026, further progress was recorded in the electricity sector. The Eskom Restructuring Task Team (ERTT) was established. This will lead the transition toward a fully independent state-owned transmission entity.

This is a critical step to ensure that the restructuring of Eskom. It needs to be conducted in a manner that minimises financial, operational, and fiscal risk. At the same time it needs to maintain energy security and investor confidence.

Additional progress was made towards establishing the Credit Guarantee Vehicle (CGV) in preparation for issuing the final Request for Proposals (RFP) for the first phase of independent transmission projects (ITPs). Consequently, government remains focused on advancing the transition to a competitive electricity market. This will be achieved by launching the South African Wholesale Electricity Market (SAWEM).

In addition, it will finalise the Electricity Distribution Industry (EDI) Reform Roadmap. Freight sector In the freight logistics sector, progress was made towards the implementation of institutional reforms with Cabinet’s approval of the publication of the National Rail Master Plan (NRMP) for public comment. The award of capacity on the freight rail network to 11 private train operating companies has paved the way for investment in new rolling stock.

Several companies announced firm commitments in this regard. Water sector The Treasury said water and sanitation reforms gained significant momentum over the period. This related to institutional restructuring, stronger regulation and the promotion of infrastructure investment.

Accordingly, President Cyril Ramaphosa has directed the establishment of the National Water Crisis Committee (WATERCOM). WATERCOM will promote the overall coordination of the response to the water crisis. It will also ensure the effective implementation of the National Water Action Plan (NWAP). The National Treasury said regulatory approvals and institutional developments that promote investment in water infrastructure are well advanced.