TNPA’s ‘Reimagined Operating Model’ aims to reorganise ports to efficiently facilitate trade.
By Robin Hayes
HAS the Government finally realised that its biggest SOE Transnet, is choking the economic and social life out of South Africa, with the announcement of ‘plans’ to stop the rot and become a responsible provider?
Is it green shoots? Are these encouraging noises from Transnet and its subsidiaries? Talk of partially privatising some rail ‘slots’ between Durban and Gauteng, a revamp and back-on-track commitments from PRASA and this latest announcement from Transnet National Ports Authority (TNPA)
Perhaps this as a consequence of the damming World Bank report(s) – Container Port Performance Index which ranks the world’s container ports. In its administrative rating Durban came stone last out of 351, Ngqura 349th, Port Elizabeth at 348 and Cape Town at 347. Using its statistical approach, Ngqura comes stone last, Durban 349, Port Elizabeth at 348 and Cape Town at 347. This condemns SA to the bottom of the class with the lowest rankings in Africa with Mombasa (Kenya) coming 43rd and Djibouti at 93rd .
The modernisation of Durban is said to require an infrastructure spend of some R100-billion to make it competitive on the world stage and meet the needs of our, hopefully, expanding economy. Reports quote Transnet executives of seeking private investment to meet this commitment but vehemently rule out any suggestion of privatisation of the ports operations.
What investor would part with their money if they had no control on how the money was spent or not being allowed management input, especially with endemic corruption in SOE’s?
Transnet’s declining performance hasn’t escaped the international investment community either, with Moody’s Investor Index placing the SOE under a review for possible downgrade, which will make international borrowing that much harder and more expensive in interest repayments.
Against this sobering background, TNPA announced at the end of June The TNPA Reimagined Operating Model where the TNPA’s port operations is segmented into three regions – the ports of Port Elizabeth, Ngqura and East London in the Central Region; Mossel Bay, Saldanha and Cape Town in the Western Region with Durban and Richards Bay in the Eastern Region.
A further announcement early in July stated a “strategic repositioning its Western Region ports to efficiently facilitate trade enabled by a seven-year R16.1 billion capital investment programme for infrastructure development at the ports of Mossel Bay, Saldanha and Cape Town.”
The allocations are R2.2b to Mossel Bay, R8.4b to Saldanha and R5.5b to Cape Town over a seven-year period.
Some general details were contained in the statement: “At the Port of Mossel Bay some of the key capital projects include the slipway facility refurbishment and Quay 3 sheet pilling. These key projects form part of the Port of Mossel Bay’s R10.2m port infrastructure development plan for 2022/23. Projects that are spread across the seven-year period include the deepening of the port and Quay 4 as well as breakwater extension.
“The implementation of capital projects planned for the Port of Saldanha for 2022/23 is already underway, which includes the acquisition of a tugboat, installation of perimeter fencing and provision of bulk power. These will derive capital expenditure of R182m for the port in 2022/23. The broader seven-year programme includes the extension of Berth 205, berth construction of the ore expansion phase 2 as well as the refurbishment of the main breakwater and causeway rock revetment.
“In the current financial year 2022/23 the Port of Cape Town will see the delivery of a robust R260m capital programme, comprising the procurement of a helicopter and the replacement of two tugboats. Phase 2 of the Cape Town Container Terminal expansion and the acquisition of ten dry dock cranes form part of the port’s seven-year programme.”
TNPA Managing Executive for the Western Region, Advocate Phyllis Difeto was at pains to whip up some enthusiasm by stating: “Our capital investment plan demonstrates our commitment to the operationalization of our Reimagined TNPA operating model that was launched in 2021. We are intentional about prioritizing capital projects that will create future capacity whilst not neglecting the immediate needs required to enhance port efficiencies.
“Zooming into the current financial year – 2022/23, TNPA boasts a capital investment programme of R452 million in the Western Region ports.”
Thecla Mneney, TNPA General Manager: Infrastructure added “As we sharpen our focus on capital investment deliverables, we acknowledge the historical under expenditure. It is for this reason that we have adopted a fresh approach to project execution, an approach that ensures all hands on deck from the project sponsors, engineers and support teams through participation in CAPEX War Rooms,”
Hackneyed clichés and platitudes aside, we shall have to wait and see whether this initiative will bear fruit. The amount of R16.1-billion spread over seven years seems inadequate to tackle TNPA’s problems and when asked where the money is coming from, the response was “from port users”.
