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Monday, 20 November 2023 20:11

DA calls on government to resolve the Transnet port and rail crisis.

By Lehlohonolo Lehana.

The Democratic Alliance (DA) is calling on the National Logistics Crisis Committee and the Department of Public Enterprise and Transport to urgently resolve the Transnet rail and port crisis.

Two weeks ago, the Umhlathuze Municipality in Richards Bay took government and Transnet to court over failure to maintain rail infrastructure, which has resulted in severe congestion of trucks transporting cargo, particularly coal, to the port.

Transnet has since confirmed the suspension of cargo brought into the Richards Bay port via road freight.

Cape Town's port is seeing delays of 14 days to offload cargo. Average delays at the Durban Multipurpose Terminal were 365 hours (15 days), while the waiting time at Container Terminal Pier 2 was 457 hours, or 19 days, according to a Transnet Port Terminals (TPT) national recovery update.

As of last week, there were roughly 70,000 shipping containers stranded on ships off Durban alone.

Several shipping lines are now imposing surcharges of around R8,000 per container, claiming that delays in South Africa are disrupting their international schedules. Among them are Hapag-Lloyd, Maersk, MSC and CMA CGM.

Working on just the 70,000 containers delayed in Durban, and this surcharge costs South African businesses over half a billion rand – roughly R560,000,000.

Additionally, port sources said more shipping firms were likely to reconfigure their routes to save money and time. A large container vessel costs about R643,000 to operate a day.

The surcharge is likely to hit South African consumers as well, as it will make imported goods more expensive. 

DA shadow minister of Public Enterprises Mimmy Gondwe says the situation is threatening to collapse South Africa's entire export sector and the national economy at large.

"The DA is therefore calling for: A public address by the National Logistics Crisis Committee on steps being taken by the national government to resolve the ongoing port crisis. A clear plan from Transnet to expedite the processing of ships at ports, including the repair and maintenance of port infrastructure.

"A national summit, comprising stakeholders in the export sector, Transnet and government to find solutions that will resolve the ongoing crisis while offering long term interventions to make our port operations more efficient."

The collapse of South Africa's rail and port utility, Transnet, has cost the country R1 billion a day in economic output, equivalent to 4.9% of annual GDP or R353 billion. This was revealed in a study by the GAIN Group, a boutique consultancy focusing on contract research of freight transport.

Rudi Dicks, joint head of President Cyril Ramaphosa's much-vaunted turnaround plan, noted that the government recognise the problem and the scope of it.

Thus, the transport crisis is rapidly displacing electricity as the main hurdle to reviving South Africa's stagnant economy.

Dicks noted that to fix our harbours, Transnet National Ports Authority will need about R50 billion in capital expenditure that is not in its budget. "The questions now are where we will get the money from and when. We cannot afford to wait a year," said Dicks.