As South Africa escalates efforts to shift freight transport from road to rail, there needs to be a balance in investing in both modes of transport.
Department of Transport (DoT) freight logistics specialist Mihlali Gqada, speaking at a colloquium on the Freight Road to Rail Migration Plan (FRRMP) in Pretoria on Thursday, said the country’s current investment in rail infrastructure is small compared to the sum spent on roads.
According to National Treasury and the Minister of Transport’s Budget Vote Speech (2023/24), the allocation for roads (transfers and subsidies) is R42.4 billion.
For 2024/25, the estimate is R42.4 billion.
This figure excludes the equitable share grant municipalities get for infrastructure development, Gqada said.
“Rail infrastructure investment is limited to the allocation for the Passenger Rail Agency of South Africa (PRASA) from the DoT, about R7 billion, whilst freight rail relies on Transnet investment and competes with ports and pipelines.
“It is, therefore, imperative that a balance in investment be fostered so that the shift can be realised.”
Gqada added that public sector investment has historically been skewed towards road infrastructure investments.
“There is a need to leverage a wide range of public and private investment tools to finance the construction and operation of rail freight infrastructure.
“The national freight transportation system requires investment to maintain performance at high levels, upon which the country's economic growth depends.”
She appealed for private-sector funding for the railway sector.
“These investments must be in the form of infrastructure and operations as Transnet would not be in a position to meet all the investment required to get the railways competitive and responsive to the country's growth needs.”
She said historically, the public and private sectors have collaborated in relation to freight transport.
“The public sector has built, owned, and operated transport infrastructure on behalf of government, predominantly railways and highways. Furthermore, the private sector has used that infrastructure to conduct freight operations.
“This division of roles provides opportunities for government to leverage private sector efficiencies and expertise in the construction and operation of freight infrastructure.”
She said South Africa, with its well-developed network of ports and logistics infrastructure, held “immense potential” to become the gateway to African markets.
“The country's transportation system offers several advantages compared to other African nations. Despite its potential, South Africa's freight transport system faces significant challenges in meeting the growing demand for freight movement, especially on rail,” she said.
“These challenges stem from operational and infrastructure deficiencies in the road, rail and port sectors, which hinder the competitiveness of the South African economy.”
Gqada said poor rail performance had rendered the country unable to participate in the recent commodity boom.
As the country grapples with the lack of investment in rail, she stressed that the government must not stop investing in road infrastructure.
“We, however, need to be cautious of the role that the South African National Roads Agency Limited (Sanral) is being given by several provinces to manage their road network as this may overburden Sanral.
“This gradual migration of provincial networks onto Sanral's portfolio must be managed very well and must not undermine Sanral's effectiveness in infrastructure development and maintenance,” Gqada said. –SAnews.gov.za
