South Africa has committed itself to a far-ranging strategy of logistical reform in a bid to lower the cost of doing business in South Africa.

Speaking at the official opening of the first session of the third democratic Parliament, President Thabo Mbeki said government planned to implement strategies to improve the national logistics system organised in Transnet.

“We will seek to work with Parliament to expedite the process of the restructuring of our ports to bring in new investment and lower the costs of moving imports and exports.

“The Coega Industrial Development Zone is already open and the first ship will be able to dock at the new Coega/Ngqura port by September next year.

“Spoornet will increase its freight capacity by 30% over the next five years, while the Rail Commuter Corporation is investing R220-million this financial year to improve commuter transport and safety,” Mbeki said.

He revealed, too, that National Treasury is in the final stages of registering the King Shaka International Airport and freight terminal as a public–private partnership.

“Construction will start after agreement has been reached with the Airports Company over land usage in the ongoing negotiations,” said Mbeki.

His statement comes on the back of severe criticism from the local business community which has stated on numerous occasions that South Africa’s undercapitalised railways and ports were becoming an impediment to export-led growth.

Government prioritised the issue at a Cabinet Lekgotla in the middle of last year following which it promised to divert fiscal resources to an improvement strategy.

However, the February Budget failed to come up with the money due to a fall in revenue collections on the back of lower corporate profits and therefore lower corporate tax payments.

It is understood that government and Transnet have been working on an alternative funding arrangement which Mbeki’s speech appears to confirm.