South African ports, ranked poorly on the global stage despite their crucial importance to continental and global trade, are getting a new lease on life, with President Cyril Ramaphosa yesterday announcing the establishment of Transnet National Ports Authority as an independent subsidiary of Transnet. Photographer: Armand Hough/African News Agency(ANA)
South African ports, ranked poorly on the global stage despite their crucial importance to continental and global trade, are getting a new lease on life, with President Cyril Ramaphosa yesterday announcing the establishment of Transnet National Ports Authority as an independent subsidiary of Transnet. Photographer: Armand Hough/African News Agency(ANA)

Independent national authority will give ports a new lease on life

By Banele Ginindza Time of article published Jun 23, 2021

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SOUTH African ports, ranked poorly on the global stage despite their crucial importance to continental and global trade, are getting a new lease on life, with President Cyril Ramaphosa yesterday announcing the establishment of Transnet National Ports Authority (TNPA) as an independent subsidiary of Transnet.

Ramaphosa said the establishment of the independent National Ports Authority with its own board was an essential part of addressing the challenges at the ports.

He said the authority would create a clear separation between the roles of the infrastructure owner and Transnet, the terminal operator. “The functional and legal separation of these roles, which are currently operating divisions of the same company, will enable each to be fulfilled more independently and with greater efficiency,” Ramaphosa said.

“In particular, it will mean 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.” Economists and the business community lauded the move, saying it would improve the efficiency of the country’s ports.

The World Bank and IHS Markit global Container Port Performance Index recently said that South African ports performed exceedingly poorly.

Business Unity South Africa (Busa) said the establishment of the authority, on the back of Ramaphosa’s lifting the ceiling for embedded generation to 100 megwatts, was a welcome trend.

Busa said Ramaphosa was taking decisive steps necessary to instil confidence among investors and to signal that the country was on the road to economic growth.

“Whereas business has been concerned about the underperformance of our ports for some time and has been vocal in its interactions with social partners on the topic, the establishment of an independent TNPA will allow the collective focus to move away from challenges towards innovative solutions,” said Busa chief executive Cas Coovadia.

Coovadia said it was high time for innovative reorganisation, and the announcement constituted a significant step in the right direction, because it would unlock investment and increase opportunities for co-operation with the private sector – users of the ports. “It is well known that South Africa’s ports are currently beset by numerous challenges, and are ranked poorly in international comparisons, including when compared to ports on our continent. While it is common cause that these constraints significantly impact on the competitiveness of South Africa’s exports, the impact on the broader economy is equally significant,” Coovadia said.

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