Swazi Rail gets privatisation go-ahead

JAMES HALL
MBABANE – Swaziland Railways looks forward to an influx of cash that private investment can bring, now that legal mechanisms enabling privatisation of the company are in place. The Swaziland Railways Act, approved by cabinet in 2002, was recently amended by parliament to permit privatisation.
“Our form of privatisation is known as a concession. An investor comes in to run the company, but the assets are owned by government and leased to the company. After the privatisation period lapses, the assets return to government,” Gideon Mahlalela, CEO of Swaziland Railways, told FTW.
Mahlalela said further assets would be brought in by new investors. A Railway Authority would be established to monitor the privatised company.
Mahlalela said Swaziland Railways was currently worth R806 million.
The rail transport system primarily services the country’s export industries, and principal clients include the coal and garment industries. All coal excavated in Swaziland is shipped via rail to South Africa. That market is stable, but the garment factories’ imported raw materials and exported products have fluctuated with the industry’s change of fortunes.
Investors would be expected to bring innovative thinking to the privatised rail line, company sources said.