The government has initiated long-overdue rail policy reforms to tame the state monopoly and open the way for the private sector to invest in the creaking national rail network. If properly implemented the reforms will be a boon for an economy whose potential has been undermined by persistent rail inefficiencies.
The rail network has suffered years of underinvestment in security and information technology systems, as well as a lack of general maintenance. The white paper estimates that underinvestment began during the apartheid era in the mid-1980s. The idea at that time was to sweat existing assets. The policy document is critical of the current trajectory of SA’s rail network. Among other observations it makes is that Transnet Freight Rail — the largest subsidiary of the Transnet Group — has focused on extending the life of uncompetitive assets rather than replacing them with competitive ones. It is therefore out of touch with the needs of the market.
The consequences of excessive port charges and inefficiencies in port management are indeed dire. Among them has been landlocked neighbouring countries shifting their business to ports outside SA, with a concomitant loss of jobs and revenue in SA. Despite some disturbing observations contained in the white paper, we should appreciate it as an honest assessment. Good policy can only be an outcome of proper, even uncomfortable, introspection. It is also encouraging that
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