The Chartered Institute of Logistics and Transport (Ciltsa) has taken a measured, fair, and thoroughly considered approach to Wednesday’s High Court ruling, which halted Transnet’s selection of International Container Terminal Services (ICTSI) as its concession partner.
Following a tender process culminating in a July 2023 announcement that the Philippines port manager would run Pier 2 at Durban Container Terminal (DCT), the local freight industry’s hopes were dashed by the successful interdict application brought by APM Terminals (APM T).
In response, Ciltsa said it would abide by the Court’s decision, and that it remained to be seen whether any party involved in the proceedings would seek leave to appeal the judgement.
Ayanda Shezi, executive spokesperson for Transnet, has indicated that the state-owned logistics company “is currently evaluating its options”.
Ciltsa pointed out that it was important to maintain perspective, especially considering what private sector involvement at the port could mean for the supply chain industry, including the importance of following due process.
“The challenges in South Africa’s transport and logistics system are well known and have been meticulously articulated,” said Ciltsa president Elvin Harris.
“Given the desperate need for speedy actions to resolve some of South Africa’s most urgent problems and constraints in our logistical system, specifically in our port and rail environments, Ciltsa was glad to see progress finally being made by Transnet on securing a global terminal operator as a partner for DCT Pier 2.
“This terminal was once the jewel of container terminals on the continent, but has unfortunately deteriorated significantly in stature over the past two decades.”
Referring to the successful interdict application, Harris said: “Ciltsa was concerned, as many others in the industry no doubt were, when it came to light that there may have been inconsistencies in the RFQ/RFP (request for quote/request for proposal) processes and the subsequent decision by Transnet to award the tender to ICTSI, and that the matter was set to be challenged by APM T.”
However, Harris added: “South Africa, the economy and the transport and logistics sectors did not need to suffer the blow of delays in the improvement of performance at DCT Pier 2 and its potential march to the top tier of container terminals on the continent once more.
“The promise of improvement is not limited to South Africa either, as Durban continues to be a major entry point for imports and exports to many countries in the SADC region. The performance of the South African economy is inextricably linked to the performance of DCT Pier 2, the largest container terminal in the country at the ocean end of our most important trade and transport corridor to the economic dynamo of the country, Gauteng.”
Looking at the ruling itself, Harris said: “The judgement would seem to suggest that APM T indeed had sufficient grounds to challenge Transnet’s decision. The judgement effectively puts a halt to Transnet’s efforts to procure a private-sector partner for DCT Pier 2 pending a full review of the challenge brought by APM T. We may be concerned about the effects of the delay on the transport and logistics industry and the economy of this judgement, but it is equally important that significant procurement processes such as these are conducted and concluded with supreme integrity, for our country needs huge doses of this too.”
Harris stressed the importance of the right private sector partner becoming involved at DCT Pier 2.
“Ciltsa has no preference for any particular partner that Transnet may ultimately choose, but we do believe that any partner with the appropriate global experience and capabilities will be good for Transnet, the port and rail system, our transport and logistics system and the South African and regional economies.
“We hold thumbs that Transnet and other parties will resolve this matter speedily and we look forward to the day that a container terminal operator with a strong pedigree can join forces with Transnet to turn around the performance of DCT Pier 2 and bring it up to acceptable international standards and improve the efficiency of South Africa’s supply chains.”
“That day cannot come soon enough,” a Ciltsa statement said.
