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Africa|Business|Container|Efficiency|Export|Freight|Ports|rail|System|Terminals|Transnet|transport|Infrastructure
Africa|Business|Container|Efficiency|Export|Freight|Ports|rail|System|Terminals|Transnet|transport|Infrastructure
africa|business|container|efficiency|export|freight|ports|rail|system|terminals|transnet|transport|infrastructure

South Africans look abroad as supply chain challenges increase

30th August 2022

By: Tasneem Bulbulia

Senior Contributing Editor Online

     

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Local container shipments for export declined by 17.5% year-on-year during the second quarter of the year as port activity was impacted by international supply chain disruptions, load-shedding and flooding in KwaZulu-Natal, PwC South Africa’s ‘South Africa Economic Outlook’ report for 2022 states.

In the eighth edition of the ‘South Africa Economic Outlook’, the firm focused on local companies finding growth opportunities abroad, ranging from exports to direct investment deals.

Apart from the transient supply chain challenges experienced, South African ports are also challenged by operational inefficiencies, the report notes.

On a positive note, Operation Vulindlela, a joint initiative of the Presidency and the National Treasury to accelerate economic recovery, has made some progress of late regarding its objective of creating a competitive and efficient freight transport system in the country, the report points out.

For example, with the necessary legislative and policy requirements now in place, rail operator Transnet is expected to release a request for proposals this month to set in place private partnerships in container terminals at the ports of Durban and Ngqura from January 2023.

“Reforms already achieved in the rail and port space, as well as ongoing and planned developments in these areas, will improve rail and port performance to the benefit of South African companies and their export business.

“Increased private sector involvement in the operation of railways and port terminals will bring key technical skills to the operation of key transport infrastructure and should improve operational efficiency,” says PwC South Africa chief economist Lullu Krugel.

INTERNATIONAL GROWTH

South Africa’s economic growth rate is slowing to a long-term potential of 1.5% a year, while the global growth trend is forecast at 2.6%.

Therefore, the report says there are faster-growing markets for South African firms who are willing to look abroad. During the second quarter, the country recorded a record-high value of R222-billion of outward merger and acquisition deals.

Some South African companies have focussed on neighbouring countries, with a notable deeper expansion into the rest of Africa, or beyond — to Europe, North America or Asia — with each company’s internationalisation route being different.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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