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Cape Town pleads for privatisation
Cape Town says the privatisation of its port could improve exports, employment and tax collections.
Last month, it was announced that the Philippines’ International Container Terminal Service would partly own and operate the Durban Container Terminal Pier 2.
Transnet said that close to 75% of the freight volume moved through the port goes through the terminal, and it accounts for nearly 50% of South Africa’s total port traffic.
This agreement “is a key catalyst for repositioning the Port of Durban as a container hub port,” Transnet said.
The City of Cape Town said that allowing private sector participation at its port could contribute an additional R6 billion in exports, add approximately 20,000 direct and indirect jobs and more than R1.6 billion in taxes over five years. It said that this was according to research done by the Western Cape’s Department of Economic Development and Tourism.
“The development in Durban is massive, and it really opens the door for some exciting innovations for our own harbour. Cape Town is now even more determined than before to achieve the same for our port, and I will be calling for an urgent meeting with the Ministers of Public Enterprises and Trade and Industry to discuss this,” James Vos, Cape Town’s Mayoral Committee Member for Economic Growth, said.
“We have willing partners to start working towards private sector participation in our port. We need to get the economic cluster in a room to talk business. We have no time to waste given the economic impact of our poorly run port.”
“Together with my provincial colleagues, I’ve been beating this drum for Cape Town for a very long time. As my business is talking to businesses, a common refrain I hear is ‘fix the harbour’. The door has been opened for Durban; now we want the same for Cape Town.”
In June, Transnet said that the Cape Town container terminal is severely underequipped, as only 16 rubber tyre gantries are available – required for moving cargo on and off ships – while the optimal number is 39.
Although bad weather has not helped the port’s performance, the city said there had been a substantial decline in the port’s performance across several indicators.
Since the start of 2023, the average vessel waiting time at anchor averaged 4.6 days – far higher than the target of one day.
The vessel turnaround time should also be four days, but it currently stands at 8.7. The average truck turnaround time of 64.5 minutes is also far higher than the target of 35 minutes.
“As soon as you get the private sector involved, there is fresh thinking; there are new ideas – and a completely different approach to the way we do business. It is always a good thing when the private sector steps up and is willing to become involved in managing key infrastructure,” Vos said.
“For a country that relies on trade and exports, it is essential that goods are moved through the ports as efficiently as possible. Cape Town, at the southern tip, cannot afford to have delays in our harbour because companies will go to other ports if they experience too many hiccups.”
“We need to get the economic cluster of the state in one room, where we can sit down with each other, look each other in the eye, and talk business. We need to discuss what privatisation entails, who pays for what, and what the private sector contributions are and what is their say over operations.
“The government needs to understand that business is a crucial player when it comes to ensuring there are no interruptions in the value chain.”
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