City Deep downgrade a fait accompli

Last week’s public hearings in Parliament on the draft Customs Control and Customs Duty Bills – which will replace the Customs and Excise Act – placed the issue of City Deep’s pending downgrade firmly in the spotlight once again. But while the SA Revenue Service (Sars) is determined to downgrade City Deep’s status as an inland port, the City of Johannesburg and Transnet still have plans to upgrade its infrastructure. The fate of City Deep is a result of the Customs Control Bill, which proposes that goods be cleared at the first port of entry into SA. This means that the inland ports such as City Deep will no longer be designated places of entry or exit for customs purposes. Voices in the freight industry have loudly proclaimed that this will lead to trade disruption and serious congestion once again plaguing the Port of Durban – that main port of entry for Gauteng cargoes. Currently, containerised cargo can move directly to inland ports upon arrival in the country under cover of a manifest – and can then be finally cleared there. While there is to be a new declaration detailing the nature, value, origin and duty payable on the goods which would replace the manifests, Sars is adamant that these contain insufficient information for them to conduct an effective risk assessment. Something which also came to the boil in the Parliamentary hearing was the limited four-day period after the new bills were published in the Government Gazette in which the freight industry was allowed to consider them. Representatives said they had not had enough time, especially as they were very different from previous drafts. Parliament’s standing committee on finance was asked for more time to consider the bills. However, despite a downgrading, freight still needs distribution hubs in Gauteng, and the idea now being proposed by the City of Johannesburg and Transnet is the creation of “logistics hubs and freight nodes” – and the further development of City Deep is to make it one of these. Its site in the centre of the city has always suffered from serious road congestion in its surrounds, and the city council is proposing to spend R100m over the next three years on improving its road connectivity, and to supply sufficient parking area for the trucks servicing the terminal which have faced serious bottlenecks at the facility up to now. And, according to Transnet Freight Rail (TFR) planning manager, Deirdre Strydom, Transnet’s planned R800m expenditure would bring City Deep “to the same standard as South Africa’s sea ports”. All this fits in with the plans to invest in the improvement of freight transport and logistics nodes in Johannesburg. Another part of this new scheme is the planned construction of Tambo Springs, which will be far larger than City Deep. It is to be built within the city of Ekurhuleni, 25km south-west of Johannesburg on the East Rand, and centred on Germiston. It has also been stressed that there is a need to create freight nodes close to areas in other parts of Gauteng, like Midrand, Centurion and Rosslyn, where suppliers are close to manufacturers. INSERT 1 The idea being proposed by the City of Johannesburg and Transnet is the creation of “logistics hubs and freight nodes” — and the further development of City Deep is to make it one of these. INSERT 2 R100m The proposed spend on City Deep upgrades in the next three years.