South Africa must regain its competitive advantage.

Minister addresses Transnet challenges

SOUTH AFRICA: “Our competitors in the broader Southern African region have taken advantage of challenges in the South African logistics sector,” Minister of Transport, Barbara Creecy told guests at the launch of the World Bank Driving Inclusive Growth in South Africa Report on Friday.

“Despite our competitive advantage as the logistics hub of the subcontinent, South Africa’s logistics sector has not been operating optimally, which has had negative implications for the country’s economy and its citizens,” she said as she emphasised the challenges within Transnet during her keynote address.

“Widespread theft and vandalism of our rail infrastructure and inefficiencies in our ports have hampered economic opportunities in a post-pandemic period where growth is much needed.”

Describing the progress being made in the broader southern African region – Creecy noted the investment in port infrastructure in Namibia and Mozambique. “South Africa is losing its competitive advantage,” she admitted.

“Urgent reforms must be implemented in our transport sector to ensure that our economy does not stagnate or lose out on growth opportunities,” she added.

With oversight of Transnet having moved to the Department of Transport following the closing of the Department of Public Entities, the Minister is now tasked to address the challenges across the various Transnet divisions.

Creecy confirmed that part of the recovery plan for the ports include the replacement and refurbishment of crucial ports infrastructure such as cranes, gantries and straddle carriers. She highlighted that the SOE is focused on collaborating with original equipment manufacturers (OEMs) to ensure that spare parts for essential machinery can be easily secured when needed.

New straddle carriers have already been delivered for the Port of Durban and rubber-tyred gantries are expected to arrive for the Port of Cape Town during the course of this month.

“At our ports, the target is to improve gross crane moves per hour from the 2024 average of 16 to 30 by 2030,” she said admitting that these ambitious targets would not be achievable within the existing Transnet systems.  “These will require significant private and public investments in infrastructure, rolling stock and digital systems,” she added.

Praising the collaborative approach to address inefficiencies in the Port of Cape Town, she reported that this had help eradicate the delays experienced last year and mitigate the impact of wind. “The port is meeting agreed shipping plans with no vessel waiting to berth due to poor operations performance.”

From road to rail

With targets of moving 250 million tonnes of freight on rail by 2030, Creecy confirmed that the rejuvenation of the rail sector was a priority. Referring to the White Paper on National Rail Policy that was approved three years ago, she highlighted the importance of private sector investment.

“As part of this process a Private Sector Participation (PSP) unit is being established by the Department in collaboration with the Development Bank of Southern Africa. Once established, this unit will help direct and coordinate private sector investments in priority rail projects requiring capital investment,” she announced.

“The rejuvenation of the rail sector is a key objective of this administration,” she said, adding that an undertaking to survey the entire Transnet rail network would provide parameters for third party access to the network.

“(This) will attract much needed investment, whilst fulfilling government’s overarching objective of shifting freight from our roads back onto our rail network.”

Noting the establishment of a single Transport Economic Regulator as the body that will regulate both ports, rail and other areas of the transport industry, Creecy did not provide any feedback on when the country will move from sector-based regulators to this new system.

PHOTO: Adobe Photostock.

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