[Letter] Bailout won’t fix Transnet

While providing a short-term shot in the arm, another sugar- high bailout for Transnet is not the answer. SA’s railway networks and ports are perennial underperformers in terms of volumes and number of containers moved.

Neighbouring Namibian and Mozambican ports cannot match SA ports’ overall capacity, but they are sending strong signals of long-term, serious capital investment.

A bailout or subsidy “similar to Eskom’s R254bn relief package from the Treasury in 2023” can buy a few more cranes or truck brackets. However, no amount of money fixes the operational, process and management problems that afflict the country’s railways and ports.

Such a shot in the arm would no doubt help Transnet with its great debt burden, but what guarantee do citizens and taxpayers have that the problems of mismanagement, corruption and cadre deployment that gave rise to the current debt mountain have been alleviated?

The various structural and policy problems that keep SA’s railways and ports in a state of dysfunction are well known. They require detailed, hard work on a day-to-day basis; some of this work has already been undertaken by Transnet.

This freshly suggested form of bailout tries to find an easy shortcut to avoid the difficult but necessary long-term policy and political work. It is not what Transnet, or more importantly SA’s reputation as a reliable trade hub and partner, requires.

Letter originally appeared here.