Region-wide fuel levy for rail proposed

A region-wide southern Africa fuel levy could endow a rail infrastructure fund to make rail competitive with road transport and assist economic growth, delegates proposed at the conclusion of this year’s Southern African Railway Association (SARA) conference held last week in Swaziland. SARA member rail systems have long contended that while countries subsidise road freight transport by building and maintaining road infrastructure, no similar investment is given rail, although several national rail systems are state owned. The proposed rail fund would come from a levy set on the price of diesel. Commercial road freight is primarily moved by diesel-powered vehicles, and a tax targeting diesel would have the effect of making the road transport industry partly subsidise rail. “Railways contribute significantly to the development of economies in the region yet there is no fund set aside to maintain the infrastructure,” said Swaziland Railways acting CEO Stephenson Ngubane. With a cost of R8m to build one kilometre of new track, rail infrastructure is expensive, he said.