https://www.miningweekly.com

South African rail sector under pressure, but PPPs can help

23rd July 2021

By: Simone Liedtke

Creamer Media Social Media Editor & Senior Writer

     

Font size: - +

Public-private partnerships (PPPs) create a platform for numerous opportunities for the South African rail sector, an industry which is currently in dire straits, says Traxtion CEO James Holley.

While the local rail industry is under pressure, Holley is hopeful that the Draft White Paper on the National Rail Policy, as well as the implementation of a Rail Economic Regulator and the South African Economic Reconstruction and Recovery Plan will provide a proverbial light at the end of the tunnel.

South African rail has, in recent years, been negatively impacted on by vandalism, which has paralysed the available fleets, as well as widespread liquidations, retrenchments and corruption.

The State-owned Passenger Rail Agency of South Africa, for example, has recorded a decrease in passenger journeys to 208-million in 2018/19, compared with 645-million in 2008/9.

In spite of this, South Africa’s massive 36 000 km installed track network still stands to benefit from excess capacity, as Transnet is responsible for transporting only 17% of South Africa’s general freight.

Holley says government can use the excess capacity to its benefit by implementing toll or access fees for private rail operators using the underused parts of the network.

“International precedent shows these are significant incremental cash flows,” Holley comments, noting that track maintenance costs should be largely fixed costs.

In addition, he notes that regional trading partners have moved to this model, supporting interoperability and regional trade for pan-African operations.

Key sectors, such as agriculture, minerals, cars and containers, liquid bulk and even hazardous chemicals, stand to benefit if this model is adopted in South Africa.

While the viability is likely still open to question, Holley says no new regulation will be required to implement the model, with access agreements playing a significant part in its success.

Edited by Chanel de Bruyn
Creamer Media Online Managing Editor

Article Enquiry

Email Article

Save Article

Feedback

To advertise email advertising@creamermedia.co.za or click here

Showroom

ZF Aftermarket
ZF Aftermarket

ZF Aftermarket is the after-sales division of the world-renowned German ZF group, a global leader in mobility technology.

VISIT SHOWROOM 
ABB Electrification
ABB Electrification

Electrifying the world in a safe, smart, and sustainable way, ABB Electrification is a global technology leader in electrical distribution and...

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.041 1.166s - 110pq - 2rq
Subscribe Now