A file picture of the Coega Industrial Development Zone.
A file picture of the Coega Industrial Development Zone.

Transnet’s strike impasse at Port of Nqgura has debilitating impact on local economy

By African News Agency Time of article published Jul 15, 2019

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PORT ELIZABETH - The "go-slow" strike action at the Port of Nqgura, north of Port Elizabeth in the Eastern Cape, is costing the local economy millions of rand every day and it is doubtful that some companies will recover, according to the Nelson Mandela Bay Business Chamber (NMBBC).

The NMBBC is deeply concerned about the current impasse at the Port of Ngqura and Port of Port Elizabeth (PoPE) where exporting activities have literally ground to a halt due to the ongoing go-slow by Transnet Port Terminals (TPT) employees, chamber president Andrew Muir said in a letter to Transnet chairman Popo Molefe, and copied to President Cyril Ramaphosa, Public Enterprises Minister Pravin Gordhan, Trade and Industry Minister Ebrahim Patel, Eastern Cape premier Oscar Mabuyane, and Transnet acting group CEO Mohammed Mahomedy.

The Transnet National Ports Authority (TNPA) and TPT were NMBBC members and strategic economic drivers in the region and major contributors in the area of job creation.

"Over the years, we have watched keenly the work Transnet has done in the Nelson Mandela Bay Metropolitan (NMBM) region. NMBBC is encouraged by some of the successes in the last 10 years, most notably the Port of Ngqura," Muir said.

Its strategic location had ably anchored a number of key industries, including the automotive, citrus, and manufacturing sectors which accounted for the region’s core exports.

The NMBBC was thus concerned by the debilitating impact that this impasse had on the local economy, as it had a potential of retarding the city’s economic growth trajectory - in a region that desperately needed economic development - as it was located in one of the poorest provinces in South Africa.

More concerning was that the prolonged go-slow could potentially depress South Africa’s manufacturing export figures and ultimately the GDP number for 2019. Additionally, it posed reputational damage to companies that had an export footprint and faced stiff international competition.

In the automotive sector, one big manufacturer stood to lose an estimated R15 million worth of production per day due to down time. When extrapolated to sector level the numbers were estimated at R42 million losses per day, which was catastrophic. This was creating a ripple effect for the company as they would be forced to implement costly triple shifts for thousands of workers to regain lost ground. The down time had forced these companies to send staff home and this translated to huge loses in income and wages, he said.

The citrus industry had also been badly affected as they had not been able to transport their perishable goods, putting their international reputation and market share at risk. There were reliable estimates that the go-slow was costing the region’s citrus exporting industry between R50 and R100 million per week.

"We note that the go-slow action started on 28 June 2019 and thus far no concrete solutions have been communicated by Transnet. We are unsure if Transnet is following the correct legal dispute resolution mechanism to urgently address the matter," Muir said.

"It is doubtful that some of these companies and sectors will be able to recover from these losses in a metro with the highest unemployment rate in the country. The go-slow has contributed to reduced productivity. Furthermore, loss of productivity as shown by the reduced throughput levels (ie 10 containers per hour as opposed to capacity of 60 containers per hour) at both ports, due to lack of maintenance of the cranes and associated equipment is of great concern.

"In light of this, we request an urgent intervention by all relevant stakeholders and a faster resolution from Transnet to put an end to this drawn-out matter so that normalised operations can resume as soon as possible," Muir said.

Workers have staged the protest action at the Ngqura container terminal for 13 days in a show of dissatisfaction about promotions. This has forced truck drivers to wait up to 18 hours before they can drop off or collect goods, leaving products from the automotive, citrus, meat, textiles and electronic sectors stuck in transit.

On Thursday Transnet said it had suspended a number of its employees at the terminal in Port Elizabeth for engaging in illegal industrial action which had had hit citrus and automotive customers the hardest.

- African News Agency (ANA) 

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