As business becomes consolidated across the continent through partnership pacts such as the African Continental Free Trade Area recently ratified in Mauritania, long-established corridors of cargo and commerce remain compromised by capacity and investor issues.
One of these corridors links Gauteng with Maputo and the Mozambican port’s Matola Bulk Terminal. The corridor is literally as old as South Africa’s democracy and yet it remains beset by some of the same dilemmas that have dogged it since 1994, says Barbara Mommen, CEO of the Maputo Corridor Logistics Initiative (MCLI).
She claims that on the bulk side, implementation of regional integration policies by some of the corridor’s primary stakeholders remains one of the most pressing challenges.
“Transnet Freight Rail’s pricing structure on the Maputo Corridor appears to favour South African ports at present. “The talk about regional integration is often vague, how trade is supposed to be supporting African growth, but when it cuts to the chase, the Maputo Corridor is a secondary corridor for South Africa.”
Through the years it has led MCLI to believe that there’s a marked disconnect between what corridor governments say at a political level and what actually happens on the ground. Mommen’s concerns hit the mark considering various presentations made by Transnet general manager of Capital Planning, Brian Monakeli, where the railways parastatal openly states that the bulk exportation of coal through Richards Bay is a flagship line for them.
It also doesn’t help that Maputo Port is not always price competitive, says Mommen. “Charges in dollars make pricing somewhat volatile against local currency and importers and exporters want pricing to be a predictable element of their logistics supply chain.”
With regard to capacity in Maputo, the container terminal was currently doubling the length of the quayside from 308m to 655m, for completion in 2019, which will address long-standing issues that have compromised traffic potential on the corridor, Mommen added.
“They are also currently developing dry port capacity in Komatipoort which could create a lot of momentum. We are watching these developments with keen interest, particularly for future seasonal citrus exports out of Maputo, and others of course.” Commenting on other capacity concerns, Mommen said railways authority Caminhos de Ferro de Moçambique (CFM) was developing a more competitive approach and was making moves to upgrade the line between Ressano Garcia and Maputo.
“But we have been speaking about this for years and we haven’t seen any major improvements yet. “Considering that CFM has made it clear that they are running at full capacity, it’s come as welcome news that $200m has apparently been set aside for electrifying the line, doubling it in certain spots, and adding in extra loops so that that have extended capacity.
“But it’s not just a rail line capacity issue,” Mommen stressed. “It’s also about rolling stock and locomotive capacity, both of which are hugely capital intensive.” Meanwhile the MCLI finds itself hard-pressed to maintain relations while simultaneously red-flagging issues constraining the corridor.
“All we have, as a private sector NGO, is the relationships we’ve built and the ability to lobby influential politicians and private sector stakeholders. It makes current institutional arrangements difficult in the long term.”
Much of that lobbying has borne fruit as the MCLI says it finds itself in the middle of a process to get the three governments to sign a revised memorandum of understanding and set up a proper public-private partnership.
“It’s an important step for us,” Mommen stressed. Most important of all, she says, is that there’s a real need for capital investment.
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There’s a real need for capital investment in rail and I can’t see it happen anytime soon. – Barbara Mommen
