The Richards Bay logistics “nightmare” last week when more than 600 gridlocked trucks carrying bulk commodities brought the port city to a halt and blocked the N2 for 12km is the result of a broken rail system straining highways to breaking point, says Juanita Maree, CEO of the SA Association of Freight Forwarders (SAAFF).
“What's happening at Richards Bay is a nightmare that's been happening for some time and will continue happening because transporting bulk commodities is not what our roads were designed for. Our road infrastructure just cannot cope.”
Contributing to the chaos at Richards Bay bulk terminal, one of the most important export terminals in the country, which also used to be one of the best in the world, is that “the infrastructure in the port is broken”.
What's happening at Richards Bay is another stark warning that Transnet is out of its depth, she says.
“Transnet has demonstrated it can't do this. It needs the private sector to help.”
An illustration is that unlike the Richards Bay bulk commodities terminal run by Transnet, the privately run Richards Bay coal terminal works perfectly.
“The private sector is more than willing to help but we don't have the reforms in place for the private sector to participate.”
These reforms are happening at a fatally slow pace, she says.
“Just like our slow rollout of Covid vaccines this slow pace is killing us because it's not facilitating the growth in trade we need. As with the vaccine rollout we don't have the urgency.”
Data analysis by the SAAFF shows that instead of the flow of freight from rail to road being reversed as Transnet insists, it's still going the other way.
“On the container lines we're only using 20% of the capacity they were designed for, which is atrocious,” says Maree.
They have talks with Transnet about private sector participation, “but we don't come to the implementation. They're more worried about new locomotives than looking at the rail infrastructure and third-party access that is conducive.”
Talk about third-party access and outsourcing the container corridor between Johannesburg and Durban is just that, she says — talk.
“If they were really serious they'd spend less time talking and concentrate more on results. You can talk forever about this but it doesn't bring results.”
Does she agree with Minerals Council South Africa that Transnet CEO Portia Derby and the CEO of Transnet Freight Rail, Siza Mzimela, need to go?
“For us it's not about people it's about getting to deliverables, and currently we are not getting to deliverables.”
In the private sector they wouldn't have been given so many chances to deliver on their promises, they'd be gone already, she says.
“If you don't deliver on the core value then what are you there for? Transnet's core value is to move rail-friendly cargo on the rail network and that is not happening.”
Derby and Mzimela blame cable theft and sabotage.
“That's not true. Cable theft and sabotage are components of the problem but that can be fixed. If you're really serious about your network you will work with your stakeholders to maintain it, do whatever it takes.”
President Cyril Ramaphosa promised third-party access more than two years ago, and only one company has taken up the offer.
“They must ask themselves why?”
They ignored advice from the private sector that the restrictive terms and conditions imposed by Transnet would discourage private operators.
“If I have an asset like a locomotive and a wagon, I will only invest in that and put it on the railway line if I know the model's going to work, if I know I'm not going to have a derailment, if I know the track is kept in good order, if I know it is being audited and maintained, if I know there is a strong, independent regulator to protect my interests,” says Maree.
“If private sector companies think the risks are too high they won't participate.”
She says she can only conclude that the process was bungled because there are more capable people in the private sector than in Transnet.
If we all know we're in such dire straits with the logistics network surely there must be an urgency to involve the experts
“If we all know we're in such dire straits with the logistics network surely there must be an urgency to involve the experts. But it seems they don't want to listen to people outside.
“But this is a shared infrastructure and good people need to speak up because it's just going one way, and we can't let it happen. Our logistics network is too important for us to just let it go.”
The government needs to create an enabling environment for meaningful private sector participation, she says.
“It's their responsibility as government to create that environment. We as private sector can participate in that environment, we can't create it.”
She doesn't see enough political will from the government to do that.
“If they say they are doing it then they're taking too long, and business is losing its appetite to participate. Look where the capital is going, where the multinationals are going. Not to South Africa.
“They're investing in infrastructure in the rest of Africa but foreign direct investment is not coming to South Africa.
“Business works on risk and reward. If they don't see government creating an enabling environment they look at other opportunities, and this is what they're doing.”
Maree says their economists have looked at the linkage between South Africa's GDP growth and infrastructure, “and we're on a downward spiral. We're not even stabilising”.
“That's why we're saying to the government: 'Wake up, create an enabling environment'.”
To what extent is the rail disaster a result of politically-connected people profiting from it?
“Let me put it like this. For us in the private sector it's very easy to resolve this problem. We're in this very dire position because we depend on the government to create an enabling environment so we can help to fix it. It would be very easy for us to fix it if we were allowed to.
“We know what needs to be done to fix the rail network, but it's not happening. The question is why not?
“We don't have clear evidence, we can only speculate. But the question is out there. It's so simple, why isn't it being fixed?”
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