Ship repair sector needs to up its game Delay to terminal extension will deal economic blow

RAY SMUTS THE IMMINENT arrival of two oil rigs in Cape Town for a combined R1 billion repair and upgrade spend – half of which will accrue to the Western Cape by way of services and jobs – underscores the potential importance of this sector to the country’s second largest port. The booming oil and gas business in West Africa is already having a significant spin-off for Cape engineering contractors, and Albert Schuitmaker, executive director of the Cape Chamber of Commerce and Industry, believes more can be achieved. “Although still in its infancy, ship repair and maintenance have been successful growth areas. But much still needs to be done as we have not worked to schedule on some of the projects, which has not done our reputation any good." Schuitmaker points out that repairs to oil and gas industry vessels can really be carried out anywhere in the world. “Cost-effectiveness and quality of repairs are key, and if we do not deliver those vessels will simply go to another port.” Alluding to the declared intention by US president George W Bush to decrease his country’s dependency on Middle East reserves, Schuitmaker believes if ship repair grows well in Cape Town, it could well spread to Saldanha and other ports, given South Africa’s close proximity to West Africa. Turning to a grave issue, Schuitmaker says crime in the Western Cape is proving a real deterrent to domestic and foreign investment. “While South Africa is almost established as a springboard to Africa, many companies are looking at establishing their headquarters in the country, some for further expansion into Africa. But it must be borne in mind that once crime reaches a certain point, investors are going to look in other directions. “The temperature needs to come down a bit before investors put South Africa back on their radar screen.” Long a proponent of a larger container terminal in Cape Town, Schuitmaker says: “It is not a question of if it happens, it must happen. “If Cape Town does not get the extension, it will lose its status as a major port city and cargo will be diverted to Durban and the new deepwater port at Ngqura (Coega), resulting in an enormous loss in business and a dampening effect on our economy.”