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THE private sector will be able to bid to run SA’s port operations for the first time next year, a move which government hopes will usher in greater efficiency and lower costs for port users.
Concessions will be accompanied by a R2bn investment over the next two years in upgrading port infrastructure.
The investment aims to modernise ports and accommodate a rapid increase in the volume of cargo moving through them.
While the concessioning of port operations to the private sector has not been targeted by trade unions, it falls within the sphere of wide-ranging union opposition to privatisation or restructuring of any kind.
Public Enterprises Minister Jeff Radebe said at the launch yesterday of the new National Ports Authority of SA, which is to house the regulatory functions of state-owned ports entity Portnet, that government had inherited an inefficient ports system.
The seven commercial harbours were operating well below globally acceptable standards, posing an obstacle to SA’s economic growth and development.
This was particularly relevant as SA’s ports handled about 98% of the country’s imports and exports, with cargo volumes totalling 160-million tons last year.
“At present, government is of the view that port operations should be concessioned to private operators,” said Radebe.
The National Ports Authority of SA is to receive the proceeds of the concessions, which will be used to develop and maintain port infrastructure. It will also be responsible for monitoring the concession agreements.
The agreements will see the private sector being granted a long-term concession, or right, to manage aspects of port operations, notably cargo handling. However, private players will not own the ports, which are set to remain in government hands.
Government officials said there was significant interest from foreign players in SA’s ports. Transport Minister Dullah Omar said foreign delegations were constantly looking at the ports, with people from Malaysia and Kenya having visited last week.
Omar said the launch of the National Ports Authority marked the end of a process to separate Portnet into two entities, the port authority and port operations.
Portnet is a subsidiary of the state-owned transport utility Transnet. Its transformation into two separate operations has been under way since 1998. “We expect to see big gains in efficiency, service and the turnaround (time of cargo) due to private sector involvement,” said Omar. Siyabonga Gama, CEO of the National Ports Authority, said the entity would assume the role of infrastructure provider and landlord. Gama said this involved developing, managing and leasing land and facilities as well as the supply of marine navigation and related services to terminal operators and port users.
