SA probes Chinese locomotive deal

Cape Town - A South African public affairs watchdog is investigating a contract for 95 electric locomotives awarded last year by state logistics group Transnet to a joint venture led by a Chinese manufacturer, it said on Thursday.

The deal involving Zhuzhou Electric Locomotive Company, a unit of CSR Ltd, is part of a R300-billion upgrade to Transnet's railways and ports to overcome freight bottlenecks.

A spokesperson for the office of the Public Protector said the deal was under investigation after a complaint from the Workers International Vanguard Party, a Cape Town-based political group, but declined to give any further details.

An independent, state-appointed body, the public protector does not have the power to cancel the deal, but can recommend corrective action or report the matter to parliament to ensure suggestions are followed. It can summon people to give evidence under oath.

The written complaint from the Workers International Vanguard Party was lodged with the Public Protector in December, citing a deal CSR won in neighbouring Namibia.

“We would like the office of the Public Protector to investigate the Transnet deal with CSR due to the fact that CSR was awarded a deal in Namibia for 22 locomotives, which were so fault-prone that they had to be withdrawn from service within weeks of being delivered,” the complaint said.

“Transnet management must have been well aware of this history. This raises the question as to how did it come about that the tender was still awarded to them,” party secretary Shaheed Mahomed said in the letter of complaint.

Calls to the headquarters of CSR outside of normal business hours went unanswered.

Transnet, which hauls some of South Africa's key export commodities including coal, manganese and iron ore, said it was unaware of any investigation but would cooperate with the authorities if asked.

“We are confident of the fairness and openness of the processes followed,” said company spokesman Mboniso Sigonyela.

The spokesman was not immediately aware of any problems Namibia has had with its trains.

The winning bidder for the Transnet contract is a joint venture between CSR, which has a 70-percent stake, and black empowerment consortium Matsetse Basadi. The first batch of trains is expected to be delivered by the end of this year and the last in September 2014. - Reuters