The Department of Transport has identified private sector participation as one of the key areas for rehabilitating South Africa’s dilapidated rail system.
This was revealed by the department’s rail policy and strategy development team during a multi-stakeholder engagement to discuss government’s White Paper on National Rail Policy, which was organised and facilitated by the Nelson Mandela Bay Business Chamber.
The department’s Rail Transport Deputy Director General Ngwako Makaepea says the National Rail Policy was approved by cabinet in May this year and reiterated that not only does it create certainty, but also introduces radical reforms in the rail sector as it would open up opportunities for private-sector investment and effective economic regulation to enable access to both the primary and secondary networks.
He said the policy sets out to revitalise the country's railway sector by investing substantially to establish a high-performance rail sector that will recapture rail's proper contribution to the national transport task. To this end, the government will spearhead the development of a Private Sector Participation Framework (PSP) to guide the collaboration between the major state owned corporations and private sector companies, to deliver new economic infrastructure projects to augment the current level of infrastructure projects.
The framework will cover broad railway private sector participation issues, different forms of participation, a clear procurement framework as well as detail on the number of opportunities and the areas of PSP in the rail industry. It further provides an important opportunity to build and strengthen local manufacturing capacity in South Africa for job creation and acquiring of new skills.
Chamber chief operations officer Ashwin Daya said: “We welcome the White Paper and intention of government to include private sector in the rehabilitation of the railway system and urge that these initiatives are implemented urgently given the challenges facing business in Nelson Mandela Bay, where our major exporters face increased cost of doing business mainly as a result of having to use road transport to haul their product to ports.”
He emphasised that the policy provides a good roadmap for rail but needs to be accelerated into implementation mode. “Exporters need to be make decisions today for 5-7 year investment cycles and cannot wait years for rail to become operational again.”
The Chamber’s Transport and Logistics task team head Lance Petersen said: “Shipping lines are bypassing our ports due to lack of a dependable rail link inland resulting in Gauteng cargo only being handled via Durban port which results in congestion and logistical delays. This impacts negatively on the automotive, perishables and wool industries and we need an efficient north south rail corridor to maximise the potential of our region’s economy while alleviating pressure on other ports. We must also leverage the advantage we have as a city with two ports of which one is a deep-water port.”