Industrialisation and the provision of infrastructure will accelerate Africa’s economic growth, says State-owned logistics provider Transnet CEO Siyabonga Gama.

Speaking at the International Heavy Haul Association (IHHA) Conference promotion breakfast, in Johannesburg, earlier this month, he highlighted that members of the IHHA and the heavy haul industry, who will gather in Cape Town for the eleventh IHHA conference in early September, have a significant role to play in ensuring that the countries in which they operate continue and increasingly drive their economies forward in this way.

“We do play a pivotal role by promoting and investing in industrialisation,” he said, suggesting that “the renaissance in rail”, which he believes is taking place across the continent, could create greater economic growth and stability, but was also critical in terms of infrastructure development.

Gama underscored the imperative of dealing with the infrastructure backlog, noting that the logistics infrastructure deficit in Africa amounted to more than R100-billion a year and had been growing by 2% yearly.

“We have a combination of years of delinquent underinvestment in infrastructure, not only in Africa, not only in our roads and rail, but also at our ports, so we are not able to repatriate raw materials from production areas to markets in the manner in which we could,” he lamented.

“We need to make sure that Africa’s share of global trade continues to grow, as it [remains] miniscule on a continent that has [a population of] more than one-billion people,” he said, noting that intra-African trade stood at about 17%, compared with intra-American continental trade of 60% and intracontinental trade in Europe and Asia of up to 40%.

“[Further,] industrialisation has actually been declining in real terms over the past decade [in Africa], which means we need to catch up on the investment and accelerate on that,” he said.

He cited the PwC ‘Gearing Up’ report, which pointed to some weak policy sectors, such as transport, holding back investment in African countries.

Key to the industrialisation and acceleration of economic growth, also through the provision of infrastructure, was the need for private-sector involvement and collaboration, Gama said.

“We must look at what is the best way . . . to attract the private sector to crowd in . . . investment into the . . . different infrastructure projects that we might have,” he said.

Gama added that, as South Africa as a country tried to modernise its infrastructure, Transnet was also embarking on a journey of significant and pervasive research and development, which would be at the epicentre of the company’s business.

“We are [investigating how to] position this company from a digital perspective,” he stated.

He further suggested that Transnet was “ideally placed to take advantage of the changes taking place on the continent and in the rest of the world, particularly in areas where it could extend its remit to incorporate other value-add services across the logistics supply chain.

“Industrialisation is key in terms of that, but, also, we believe that our success in the Market Demand Strategy is a testament to the strong and agile manner in which we are navigating tough macroeconomic challenges,” Gama added.