The Department of Transport (DoT) is undertaking a two-part consultation programme on the Roadmap for the Freight Logistics System in South Africa ahead of Cabinet approval, which is unlikely before February.
Following a Cabinet meeting, Minister in the Presidency Khumbudzo Ntshavheni said that the roadmap consultations were “part of measures to address the challenges facing the freight and logistics sector and the strengthening of South Africa’s economic recovery efforts”.
She reported that the DoT consultations were progressing with direct stakeholders and experts in the sector, including Transnet and private industry participants.
Once a draft had been finalised the document will be released for broader public consultations before returning to Cabinet for approval.
Given that the Cabinet meeting cycle was winding down for 2023, Ntshavheni said it was unlikely that Cabinet would consider the roadmap for approval before February.
Finance Minister Enoch Godongwana said in his Medium-Term Budget Policy Statement that the roadmap would guide reforms in the sector, including increasing private participation in the ports and rail networks.
He also indicated that, only once Transnet’s corporate and operational plans were aligned with the roadmap would there “be a conversation about whether and how government can provide financial support to transform the logistics sector”.
It has been reported that Transnet is seeking debt relief and a capital injection worth more than R100-billion and it has indicated that its recently released recovery plan will not succeed absent such support.
The State-owned enterprise currently has debt of R130-billion and has reported a sharp decline in rail volumes on the back of locomotive shortages, inadequate maintenance, as well as theft and vandalism on its network.
The group, which recently shed its CEO, CFO and rail head, reported a R5.7-billion loss last year and will also report a loss during the current financial year.
Transnet recently advertised the CEO position internally and externally, with a closing date of October 19.