By Xolisa Phillip
Transport freight rail is the backbone in the movement of material. It is also worth noting that Transnet Freight Rail, beset by many problems, is the state-owned logistics company’s biggest operating division.
Even the best of intentions can have adverse outcomes. Intent, sometimes, does not necessarily equate to efficacy. There are too many factors and variables that can influence the usefulness of stated aims versus consequences. It is often the latter, which is more tangible and measurable, that can shape public perception.
In my previous life, “Olivia Pope-ing”, one of the most fascinating aspects of the job was sitting and listening in on policy committee meetings. In this realm, unfiltered views permeated and were ventilated. There was a refreshing frankness, but also a debilitating sense of déjà vu. Truly, there was no shortage of roundtable discussions.
A recurring theme was the state of the transport sector from a commercial perspective. In particular, the quest to shift the movement of bulk goods from road to rail. There are a multiplicity of factors that have slowed the realisation of this goal, chief among these being the fact that freight rail is the purview of a state monopoly.
This week, I revisited this conversation with Njombo Lekula, an MD at cement producer PPC, who looks after South Africa and Botswana. Lekula is a measured executive who has seen the ebbs and flows of the market. But he is also pragmatic about the confluence of factors that influence his sector’s performance.
Eskom is often, rightly, seen as the problem child among state-owned entities. It is obvious why: electricity is an enabler of economic growth. The 2008 experience has shown this. So, too, will the current round of erratic load shedding. But that is a conversation for another day.
Industry- and sector-speak tend to shift with the times. This is no different in the age of Covid-19.
One of the terms that has been repurposed is “comorbidities”, with reference to the South African economy. In this context, the economy’s “comorbidities” are the underlying issues that predate the pandemic and have become more pronounced as it unfolds.
However, this is not to make light of the death, the despair and the misery visited upon many people because of the coronavirus outbreak.
Cable theft and vandalism have been the focus of a previous column, looking at how these two problems pose a threat to the Passenger Rail Agency of South Africa (Prasa) and Transnet from an operational point of view. The two entities are collaborating to resolve the problems, so they’ve said.
But “during the lockdown, there was a lot of vandalism”, according to Lekula.
As such, Botswana Railways is performing better than Transnet Freight Rail (TFR), “which is quite embarrassing”, says Lekula.
As far as he is concerned, “TFR is one area I think we need to put a lot of effort in. If you have a rail network like South Africa’s, you should be operating as first-class or on par with some [developed countries].
“That is a conversation South Africa is shying away from, we focus just on Eskom.”
Admittedly, Eskom has its own issues, but transport freight rail is the backbone in the movement of material. It is also worth noting that TFR is the state-owned logistics company’s biggest operating division. So this is not alarmist speak from industry. Transnet concedes as much in its reporting.
This is also by no means a critique of the present leadership, which has inherited many of the legacy issues besetting the entity.
Failure to make inroads on the issues will undermine the goals of road to rail. The probability of the road transportation of materials becoming cheaper than rail, especially in terms of bulk materials, rises in the absence of resolution.
“That’s an indictment. I am trying to get an appointment with senior leadership of TFR to address that issue because it’s limiting,” Lekula reveals.
TFR was invited to comment. The invitation has not been taken up.
From an industry standpoint, some commodities are concentrated in the far-flung corners of South Africa – away from the market, where there is demand. In PPC’s case, the company has clinker manufacturing facilities in Thabazimbi and North West.
For this material to get to market, freight rail is an important component.
“It has a huge impact on the economy. I don’t know how many millions TFR is losing. We know for a fact we lose a lot of money, and they lose money in our route to Port Elizabeth. This is over and above the pandemic. It’s… the infrastructure that has been vandalised,” explains Lekula.
As that conversation evolves, another one is emerging: how the current disruptions in global supply chains have magnified the importance of local production.
Some projects are experiencing delays because of a steel and timber shortage. “It’s stuff we can produce ourselves in this country,” says Lekula.
The ironies abound.
*Source: Business Maverick