South African President Cyril Ramaphosa directed executives of state-owned rail and port operator Transnet to come up with a plan to end the nation’s logistics crisis.
The embattled company has struggled with major inefficiencies that have led to traffic being redirected to ports outside South Africa and spawned stockpiles of commodities that can’t be railed.
“We must remain focused on structural reforms to improve the efficiency and competitiveness of the transport sector in the long term,” Ramaphosa told Transnet management at a previously unannounced meeting in Pretoria, the capital, on Tuesday.
“One of these reforms is to enable third-party access to the freight rail network by private rail operators, while the network itself remains in the ownership of the state.”
Thungela Resources Ltd., South Africa’s largest exporter of thermal coal, said on Monday it expects sales to drop for a second year because of bottlenecks at Transnet.
The state company has rejected an offer from Anglo American Plc to take over the running of its ore line, which is one of its most profitable routes, but battles to move sufficient volumes.
“Transnet must quickly embark on a clear path to take us out of this crisis and ensure that the operation of our railways and ports contributes to the growth of our economy,” Ramaphosa said.