Minister Barbara Creecy Advocates for Private Sector Participation and Infrastructure Reform at SEIFSA Conference
On 17 September 2024, the Minister of Transport, Ms. Barbara Creecy led a One-Day Metals and Engineering Industry Ministerial Conference organised by the Steel and Engineering Industries Federation of Southern Africa (SEIFSA) at the Emperors Palace in Johannesburg.
The One-Day Conference was attended by captains of industry representing the metals and engineering sector and key members of government and business leaders. The sector is a key part of the domestic and global economy and supplier of inputs into major sectors such as agriculture, mining, the automotive, construction and other manufacturing sub-industries.
One of the speakers was Minister Creecy, who highlighted that the Department of Transport is developing a framework for Private Sector Participation (PSP). According to the Minister, the Department plans to establish a unit focused on private sector involvement that will operate under the DBSA. This initiative aims to draw lessons from the reforms implemented in the electricity sector, ensuring that when there is appetite to participate in the logistics sector, they’re able to take these particular bids to financial close. She also noted that the foundation of this reform program is the Transnet Network Statement.
She also addressed the freight-rail situation, highlighting that both the freight and passenger rail systems are functioning at less than optimal levels, especially regarding freight operations. Although the Department has made progress from the severe conditions faced in 2022 and 2023, they are still transporting only around 150 million tons of freight each year. “But industry requires us to be moving closer to the 250 million mark. Now, the reasons for this are historical, but in terms of the current situation, they relate to the poor state of infrastructure of our main freight corridors. It also relates to the poor state of equipment in our ports. And, of course, it relates to the difficulties we have with regard to accessing sufficient locomotives to move freight with the speed and efficiency that is requires.”, said the Minister of Transport.
She stressed the importance of prioritizing infrastructure development, emphasizing the vital role of steel in both the construction industry and infrastructure development. Additionally, she advocated for the continuation of the ongoing structural economic reforms through Operation Vulindlela, which includes creating a competitive electricity market and introducing private sector competition in port and rail operations.
The Minister concluded the program by expressing her wish for the interim economic regulator assisting the Department to put out the final network statement before the year’s end as this network statement is essential for the private sector to comprehend the available options for participation, including potential tariffs and opportunities for build, operate, and transfer projects. These factors are likely to greatly interest the private sector. It is important to note that the tariff must be appealing to third-party participants while also helping Transnet meet its revenue generation needs.
