South Africa’s ports among the worst in the world

[Nat Quinn]

South Africa’s ports among the worst in the world

The volume of rail and port cargo handled in South Africa has declined significantly over the past few years, with the country’s ports now ranking among the worst in the world.

Financial services firm PwC revealed this in its South Africa Economic Outlook for March 2024, which focused on the country’s stagnant productivity.

The firm said that reliable infrastructure is the foundation of any modern economy and is a significant contributor to worker productivity.

Reliable infrastructure and well-maintained equipment can boost productivity, while a lack of adequate infrastructure investment will weigh heavily on productivity.

In the case of South Africa, capital investment declined every year from 2016 to 2020, while capital formation contributed just 0.5%, on average, of the country’s real GDP growth in 2021-2023.

South Africa’s key economic challenges over the past years—electricity generation, water supply, and railway and port services—are due to underinvestment over a much longer period.

The country’s deteriorating ports and railways are emblematic of this decline, with the number of containers handled at South African ports declining from nearly 4.5 million in 2021 to 4.1 million in 2023.

Railway freight volumes have declined from a peak of nearly 20 million tonnes per month in 2017 to an average of less than 14 million tonnes per month in 2023.

PwC said this is part of a broader trend of the state’s inability to deliver the quantity and quality of services it previously did, with many companies seeking private-sector alternatives.

Due to the poor performance of Transnet’s railways, road freight transported by trucks has increased from 60 million tonnes per month in 2017 to over 72 million tonnes a month in 2023.

This indicates that road haulage has, over the past six years, absorbed six million tonnes of goods per month from the deteriorating railway system and an additional six million tonnes of ‘new’ freight.

The deterioration of Transnet’s railways is compounded by the dismal performance of its ports across South Africa.

The World Bank Container Port Performance Index 2022 ranks harbours based on the time taken for each port call recorded by the ten largest liner shipping companies.

The data reflects information for 434 ports as recorded by S&P Global Market Intelligence, with the World Bank ranking 348 of the ports with a sufficient volume of ship traffic for results to be considered reliable.

Whether ranked out of 348 or 434 territories, South Africa’s port performance is dismal.

Durban, the busiest shipping terminal in Sub-Saharan Africa, is placed 341st. This ranks the port at the 79th or 98th percentile, respectively, depending on the size of the ranking population.

In turn, rival ports – competing for the business of South African exporters and importers – are doing much better.

Mozambique’s Port of Maputo (only 550 km from Johannesburg) is ranked 223rd, while Namibia’s Walvis Bay is placed 293rd.

 

source:South Africa’s ports among the worst in the world – Daily Investor

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