<\/p>\n
Reform of our logistics sector is critical to our future economic success. We cannot be a competitive exporting nation without efficient ports and efficient access to them.<\/p>\n
Our farms, factories and mines need to be able to get their output to markets around the world at prices that are competitive with other producers. That is critical to enabling economic growth and job creation.<\/p>\n
This is urgent. Last week\u2019s unemployment figures showing an increase to 32.7% in the first quarter, up from 31.4% in the previous quarter, brings the number of unemployed to 8.1-million people.<\/p>\n
The economy shed 345 000 jobs in the quarter. I agree with Cosatu that these figures are \u201cbeyond depressing\u201d. But I hope we can spring into action to implement the reforms that will turn it around.<\/p>\n
Growth is the only path to creating the jobs we desperately need. And growth requires competitive logistics that enable our exporters to succeed in global markets.<\/p>\n
Read: South Africa jobless rate rises before Iran war fallout hits<\/p>\n
Progress has been slow<\/p>\n
This is why organised business has had a sharp focus on reforms in this critical economic infrastructure. BLSA contributed funding and expertise to the National Logistics Crisis Committee and continues to support B4SA\u2019s efforts to partner with government in turning around the performance of our logistics system.<\/p>\n
While there definitely has been progress, it has been slower going than we would have liked. The plans drawn up by the NLCC are clear \u2013 we need considerable new investment in the logistics system and that can only be achieved through greater private sector participation.<\/p>\n
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That has been adopted into policy, but the process of enabling private access to the rail network and concessioning of port operations has not gone smoothly.<\/p>\n
As BLSA\u2019s Reform Tracker noted in its quarterly update last month, transaction terms push risk disproportionately onto private providers while Transnet continues to design the terms on which private investors are given access to operate public infrastructure.<\/p>\n
Still, there are encouraging signs of progress. Statistics reported last week for freight volumes through South Africa\u2019s ports in 2025 show a genuine recovery.<\/p>\n
A total of 8 630 vessels called at our ports, a level not seen for 15 years. That is key to the success of export industries, including our citrus industry, which overtook Spain last year to become the biggest citrus exporter by volume in the world.<\/p>\n
Read:
Transnet hikes container surcharge to R78
How Transnet plans to \u2018Uberise\u2019 rail in SA
Transnet bottlenecks spur fresh private rail investment push<\/p>\n
Ports are winning<\/p>\n
Those volumes are set to increase thanks to reforms that have enabled private investment. Philippines-based International Container Terminal Services, a global port operator, took over the Durban Gateway Terminal in January and is investing R11 billion to boost capacity by 40%.<\/p>\n
FFS Tank Terminals is taking over the Cape Town Liquid Bulk Terminal, investing close to R200 million to modernise infrastructure and double terminal capacity.<\/p>\n
In Durban, Transnet has signed a 20-year agreement with FPT group for the Durban Fresh Produce Terminal. The Richards Bay Dry Bulk Terminal and Ngqura Manganese Export Corridor are also being prepared for private participation.<\/p>\n
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Transnet\u2019s own investment has contributed to capacity gains, including upgrades of container handling at Durban and Cape Town, with plans for further expansion. But sustainable growth requires genuine competition, and Transnet will have to guard against constraining private participation.<\/p>\n
These port wins prove what\u2019s possible when government enables rather than obstructs private investment. This approach must become the norm.<\/p>\n
Another win last week was the finalisation of 11 private rail operators\u2019 contracts with Transnet Freight Rail Infrastructure to operate various routes on the network.<\/p>\n
After difficult negotiations to ensure projects were bankable, these operators are expected to add 24 million tonnes of freight capacity across coal, manganese, containers, fuel and general freight. Some are expected to begin operating before the end of this year, though most will begin next year.<\/p>\n
Read:
Southern Africa\u2019s ports miss out as global shipping routes shift
Port of Cape Town secures FFS Tank Terminals for 25-year liquid bulk concession
Miners and Transnet eye Ngqura terminal to boost SA exports<\/p>\n
To ensure the open access rail system now envisaged by policy continues to boost volumes and efficiencies, we urgently need the fourth Network Statement, which the Transnet Rail Logistics Manager says is at an advanced stage of finalisation.<\/p>\n
Delays mean ongoing losses in competitiveness. We\u2019re making progress, but we\u2019re still years behind where we should be.<\/p>\n
Momentum in transport reform<\/p>\n
Transport minister Barbara Creecy and Transnet CEO Michelle Phillips (and her team) deserve credit for this progress. The Minister\u2019s leadership extends beyond ports and rail.<\/p>\n
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Last week, she announced a new legislative framework for the Road Accident Fund (RAF), which has faced severe governance and financial challenges for years and is technically insolvent.<\/p>\n
The Minister dissolved the RAF board last year and is planning a hybrid funding model through a Road Accident Benefit Scheme Bill to be introduced to parliament later this year.<\/p>\n
Read: DoT considering private and public contributions to fund the RAF<\/p>\n
These logistics and transport wins demonstrate what decisive leadership can achieve. The reforms are delivering measurable results \u2013 record vessel volumes, billions in private investment, new rail capacity, progress on long-neglected problems.<\/p>\n
This is how we create the conditions for exporters to compete, for businesses to grow, and for jobs to be created. With 8.1 million South Africans unemployed, we cannot afford delays or half-measures.<\/p>\n
Momentum must accelerate. We need the Network Statement completed. We need more port concessions finalised. We need transaction terms that genuinely enable private investment rather than protecting Transnet\u2019s monopoly.<\/p>\n
Ultimately, South African business needs a choice of port operators and rail providers, competing to offer the best service and prices. We\u2019re moving in that direction, where growth and jobs await.<\/p>\n
Busi Mavuso is CEO Business Leadership South Africa.<\/p>\n
#South #Africas #logistics #reforms #afford #slow<\/p>\n","protected":false},"excerpt":{"rendered":"
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