Say goodbye to South Africa’s most important port as you know it

South African port and logistics firm Transnet signed a concession agreement with a company headed by Filipino billionaire Enrique Razon to expand the main terminal at the continent’s top container hub in Durban.

The signing of South Africa’s first port-privatization deal comes two years after Transnet awarded International Container Terminal Services Inc. the right to buy almost half of Container Terminal Pier 2 and manage the facility for 25 years.

Razon’s firm will spend about R11 billion on its plans.

“This ground-breaking partnership is a step forward in Transet’s ambition to be among the world’s best ports,” Transnet Chief Executive Officer Michelle Phillips said at a ceremony in Durban on Wednesday.

The agreement marks the biggest attempt yet to bring in private expertise to revive state-owned ports, which rank among the least efficient globally, according to the World Bank.

Pier 2 handles about 70% of Durban port’s total throughput and more than 40% of South Africa’s container volumes, she said.