South Africa Announces Major Logistics and Rail Investment Plan to Boost Economic Growth
As Transport Minister Barbara Creecy unveils an ambitious investment plan, South Africa’s struggling logistics and rail sector is set for a major transformation. Aimed at improving freight efficiency, attracting private sector investment, and driving economic growth, this bold initiative marks a crucial step toward revitalizing the country’s transport infrastructure.
Years of derailments, inefficiencies, and port congestion have taken a toll on trade and economic performance. In response, Minister Creecy’s strategy focuses on modernizing key transport networks and encouraging private investment to restore South Africa’s competitive edge and support long-term economic recovery.
“Driving Inclusive Growth in South Africa: Quick Wins with Competitive Markets and Efficient Institutions.” She made the remarks during the unveiling of the World Bank report”.
“Government has established the National Logistics Crisis Committee comprised of representatives from the Presidency, various government departments and the private sector”.
“Its work includes securing strategic logistics corridors handling commodities that are essential to the export market and economic growth; addressing backlogs and congestion at strategic border crossings; combatting congestion in key national highway corridors such as the N1 and N3, as well as interventions to combat cable theft and maintenance backlogs at Transnet”.
“This collaboration has seen modest improvements in our logistics performance,” she said.
Investment
Creecy emphasized that revitalizing the rail sector is a key priority, starting with the Cabinet’s approval of the White Paper on National Rail Policy in March 2022.
“The Rail Policy introduces structural reforms in the sectors intended to enable private sector investment, optimal utilisation of the rail network, and effective economic regulation of rail that will facilitate equitable access to the rail network and ensure that it is properly managed”.
“As part of this process, a Private Sector Participation Unit is being established by the department in collaboration with the Development Bank of Southern Africa. Once established, this unit will help direct and coordinate private sector investments in priority rail projects requiring capital investment.”
The Minister revealed that the department is actively issuing Requests for Information (RFIs) to assess market interest, gather industry insights, and explore potential partnerships. This initiative aims to attract private sector participation and drive the modernization of South Africa’s logistics and rail infrastructure.
“This serves to share information with the public regarding possible PSP projects, but also to allow the department, and by extension Transnet, to gather information on projects with the potential for third party involvement.
“I want to emphasise again that throughout this process all rail and port infrastructure will remain under the government’s ownership. We are also in the process of consulting with organised labour regarding the details of our freight logistics roadmap”.
“We cannot continue with the status quo, where derailments and port blockages cost our economy billions of rands, and thousands of jobs in all sectors of our economy are at risk, Creecy said.
The Minister stated that Transnet has implemented a recovery plan to increase and stabilize port and rail capacity. “The establishment of various war rooms for specific corridors and commodities has allowed Transnet and the private sector to collaborate and share expertise and address challenges such as derailments and unplanned maintenance”.
“As part of Transnet’s Recovery Plan, replacement and refurbishment of crucial ports infrastructure such as cranes, gantries and straddles is planned in the short, medium and long term, and continued collaboration with original equipment manufacturers (OEMs) has ensured that spare parts for essential machinery can be secured when necessary.
“This has resulted in improvements we are seeing in our ports, which have cut down on ship waiting times and queuing times for trucks,” she said.
