Sip 2 key to unlocking capacity along SA’s freight corridors – Transnet

5th July 2013

By: Shirley le Guern

Creamer Media Correspondent

  

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Government’s Strategic Infrastructure Project (Sip) 2 would be key to unlocking economic development and providing much needed capacity along key freight corridors in South Africa, provided that the diverse range of public and private sector stakeholders planned and coordinated the roll-out of infrastructure, Transnet Group strategy GM Irvindra Naidoo told the Transport Forum, in Durban, on Thursday.

Sip 2 was aimed at strengthening the logistics and transport corridors between the major industrial hubs in the country.

“We have a long-term plan and, if everybody comes together and works together, we can achieve a lot. A key challenge is to get everyone to agree on where we are going and how we are going to get there,” he said.

Naidoo identified the differing agendas of local and provincial authorities, as well as clashes with the private sector, as potential roadblocks. He said conflicts between the public and private sector had, in the past, prevented the realisation of the benefits of linking infrastructural projects. “We need to create more opportunities where we get together and talk. What we have seen in the past is that we have diverse plans so we tend to waste infrastructure.”

The Durban–Gauteng corridor, by far the most important economic corridor in the country, is expecting massive increases in freight volumes. “In 20 years, we will have double the amount of freight. We have to make sure that infrastructure can keep up. We don’t want to get into a situation – particularly on the port side – where we find that demand is outstripping capacity. Then we start to get congestion and unreliability, which has a whole lot of negative implications,” he said.

Figures presented by Naidoo indicated a 152% increase in freight along the corridor, from 762-million tons a year in 2011 to 1.93-billion tons a year in 2041 at a 3.1% compound annual growth rate. At the ports, he said they had been dealing with 2 600 vessel-equivalent units a year (or 3 864 actual vessels) in 2011. This was expected to grow to 7 000 vessel-equivalent units.

“In the hinterland, we are dealing with 2 800 trucks. We are expecting this to grow to 8 300. If we look at the Gauteng corridor, in particular, we currently have around 4 200 trucks going up the corridor to Gauteng. We expect to bring the number of trucks on the corridor down to 2 700,” he said.

The amount of freight will grow and, with it, the number of trucks in the short term. However, Naidoo is confident that this will lessen again with the increase in alternative forms of transport, such as rail.

“If you look at the corridor between Durban and Gauteng, the brief is to improve logistics between the main industrial hubs; improve access to the port; raise the efficiency; integrate the proposed intermodal terminal in Harrismith, in the Free State, into the corridor; and make sure that we can provide better services to the agricultural sector,” he explained.

One of the most critical issues is improving access for smaller towns along the corridor, he said. “What we find now is that, while you have reasonable connectivity between terminals, the feeder routes on the corridor are not that well established. The cost to actually bring your goods on to the corridor is quite high.”

For Naidoo, it is important to both accelerate and synchronise the infrastructure roll-out and to counter criticism that projects of this nature are seldom delivered on schedule, if at all. “We need to look at the demand along the corridor, how we sequence these projects, who the stakeholders are that need to come together to make sure that the projects happen, identify the risks, escalate them where we can and then keep the channels of dialogue open,” he said.

He listed the City Deep terminal and the enhancement of the road network around the terminal, the development of the Tambo Springs Inland Port and Logistics Gateway, the terminal just outside Heidelberg and the aerotropolis at the OR Tambo International Airport as key projects in the northern region.

In the central region, he said issues that needed to be dealt with included capacity requirements and unblocking congestion along the N3, developing the rail corridor to handle the expected volume increases, the finalisation of Transnet’s multiproduct pipeline and electricity transmission projects that would support the various projects. “You don’t want to get into the situation where electricity becomes a key constraint,” he pointed out.

According to Naidoo, the southern region is where the bulk of the money is being spent. Projects include the expansion of roads, terminals and rail infrastructure within the Port of Durban, the Durban dig-out port, the Dube TradePort, and the aerotropolis surrounding the King Shaka International Airport and the Cornubia integrated settlement, as well as development of logistics capabilities at Cato Ridge.

One of the key concerns within core urban areas such as Durban, Johannesburg and Pretoria is the need to decrease the number of heavy vehicles on the roads by providing hubs and increasing mobility on the peripheries and then using smaller trucks to distribute goods, he added.

“Stakeholders support the roll-out of infrastructure for intermodal facilities and they are very committed to the whole road-to-rail agenda and the provision of adequate public transport. They want to change the way people get to these facilities to work. The idea is that these facilities will form the core nodes of industrial complexes going forward,” he said.

In Gauteng, in particular, he said the emphasis was on improving safety and security around deliveries, delivering more freight at night to reduce congestion, improving overload control and greater use of smaller vehicles to lessen the negative impact on roads.

Going forward, Naidoo said there was a need for further research to establish the logistical elements that were of greatest concern to customers. Issues that needed to be examined included timing, whether it was easy to organise international shipments and tracking and tracing capabilities, besides others.

He said a recent World Bank port study had rated South Africa twenty-third out of 155 countries and the best-performing upper middle income country in the world. “What they found is that, among upper middle income countries, of which South Africa is one, infrastructure is the main driver. This is seen as the key constraint. So, if you begin to fix up your infrastructure ahead of other aspects, you are likely to get a bigger bang for your buck,” he said.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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