President Cyril Ramaphosa announced the establishment of the Transnet National Ports Authority
President Cyril Ramaphosa has announced the establishment of the Transnet National Ports Authority. Photo: SANews

President Cyril Ramaphosa today announced the establishment of the Transnet National Ports Authority as an independent subsidiary of Transnet.

Following his visit to the Port of Cape Town, the South African President said:

“This is an important part of the Economic Reconstruction and Recovery Plan… The weak performance of our ports is the result of structural challenges in our logistics system and operational inefficiencies. It is for this reason that we are today announcing the establishment of the Transnet National Ports Authority as an independent subsidiary of Transnet, in line with the National Ports Act of 2005.

“This will mean the establishment of an independent National Ports Authority as a wholly-owned subsidiary of Transnet, with its own board appointed by the Minister of Public Enterprises.”

This means there will be a clear functional and legal separation between the roles of the infrastructure owner (Transnet National Ports Authority), and the terminal operator (Transnet Port Terminals).

It will mean for instance that “revenues generated by the ports can be invested in port infrastructure, both for the replacement of old equipment and for the upgrading and expansion of our ports,” said the President.

“The creation of a separate subsidiary will allow the ports authority to make its own investment decisions and will ensure that it treats all terminal operators fairly and equally in the interests of port users.”

The President said Transnet will remain the sole shareholder of the subsidiary to prevent any negative impact on the group’s balance sheet, and to ensure the ports authority remains an important part of the Transnet group.

He said this was a significant development because this reform has been delayed for more than 15 years since the National Ports Act was promulgated.

The President is on a mission to overcome long-standing obstacles and delays in the implementation of reforms.

“Together with the restructuring of Eskom, this is part of our ongoing effort to reposition and transform our state-owned enterprises so that they can be profitable, sustainable and competitive and can play a developmental role in our economy.”

He said the reforms will not only impact port users but “also have an impact on the lives of ordinary South Africans, who will benefit from lower prices of goods and more jobs throughout the export value chain.

“It may not be obvious to us, but almost every single product that we purchase is affected in one way or another by our ports.”

Reforms crucial in accelerating recovery, create jobs

“Most importantly, these reforms are necessary to accelerate the creation of jobs,” said Ramaphosa. “It is for this reason that we have focused on reforms in electricity, water, digital communications and transport, as well as reforms to our visa regime.”

He said South Africa’s ports are vital to the country’s trade with the rest of the world and play a crucial role both South Africa’s own economy and that of the wider Southern African region.

“The Port of Cape Town is strategically located on one of the busiest international shipping routes and is our second-largest container port by volume. It is particularly important for the export of our fresh fruit and wine.

“If the port functions efficiently, the economy of the Western Cape and indeed the entire country benefits.”

Western Cape Government welcomes “corporatisation” of Transnet National Ports Authority

Western Cape Minister of Finance and Economic Opportunities, David Maynier, said the WC Government “welcomes the corporatisation of Transnet National Ports Authority”.

During the visit to the Port of Cape Town, Premier Alan Winde also welcomed the announcement, and the engagement with President Ramaphosa. “The Port of Cape Town is among the world’s most popular trade routes, and certainly one of the busiest in South Africa. It has immense potential, and with the right maintenance and investment, it could play a leading role in driving our province and country’s economy forward.

“An efficient and world class port would also go a long way in bolstering the province’s agricultural sector which is a significant exporter in our province. By supporting the port, and this industry, we will unlock a greater number of job opportunities for those who need it most. We must strive to match the outputs of other major port cities and in doing so, bring on board private partners who can assist us in achieving this.”

Maynier, added: “The Port of Cape Town has experienced significant operational challenges as a result of ageing infrastructure and equipment, staffing shortages and weather disruptions.

“And so, we welcome the short-term measures being put in place to improve port efficiencies and we remain committed to working with the management team at the Port of Cape Town.”

Sources – and DA