South African Business 2018 edition

OVERVIEW
Transport and logistics
Investments in rail are increasing.
SECTOR INSIGHT
Sheltam is expanding its rail
operations into Africa.
South Africa has 21 000km of railway lines and 747 000km
of roads, 325 019 heavy-load vehicles and the road freight
industry employs 65 000 drivers. The logistics and courier
market is worth R10-billion. There are 135 licensed airports
in the country, 10 of which have international status.
Investment in improved infrastructure is being made at all of
South Africa’s ports. Special Economic Zones are in place at the
ports of Saldanha on the West Coast, Coega (Port Elizabeth), East
London, and Richards Bay in northern KwaZulu-Natal. The Maputo
Development Corridor is Africa’s most advanced spatial development
initiative. Run by the Maputo Development Corridor Logistics
Initiative (MCLI), the corridor runs from near Pretoria in Gauteng, to
Maputo in Mozambique.
The Harrismith Logistics Hub at the Maluti-A-Phofung SEZ on the
N3 is an inland port that can handle cargo containers and shift cargo
from road to rail, reducing congestion and costs.
Transnet is the state-owned enterprise focussed on transport and
logistics. It comprises Transnet Freight Rail, Transnet Engineering,
Transnet National Ports Authority, Transnet Port Terminals and Transnet
Pipelines. Transnet Freight Rail’s operations represent about 80% of
Africa’s rail infrastructure. With 25 000 employees TFR has specialist
divisions for hauling coal and iron ore together with a general freight
division which transports everything from grain to chemicals.
The major rail haulage lines are the manganese line from the
Northern Cape to Port Elizabeth; from Sishen in the Northern Cape to
the Port of Saldanha (iron ore); and from the coalfields of Mpumalanga
to Richards Bay. More than 55-million tons is regularly transported
along the former and upwards
of 70-million tons can travel annually
along the latter.
Almost 90% of freight is transported
by road and the logistics
sector is very reliable. However,
these volumes are not good for
the condition of the country’s
roads and Transnet is working
hard to attract more business to
the rail network. TFR has put 28
new electric locomotives on the
line supporting steel producer
ArcelorMittal to improve service.
The rail sector is receiving
many investments. The speedy
Gautrain which started life as
a service to the main airport in
Johannesburg has been tremendously
popular and there are
plans to expand its network. Bids
to supply 12 new trains will be
adjudicated on in 2018.
A total of 600 new passenger
trains will be added to Metrorail’s
fleet at a cost of R51-billion.
Transnet Freight Rail has ordered
1 064 diesel and electric locomotives
from four suppliers.
Sheltam Group is expanding
its services beyond rail services.
A new lease company (for rolling
SOUTH AFRICAN BUSINESS 2018 106