South African logistics group Transnet has unveiled a R300 billion plan which is set to create almost 600,000 new jobs across the economy.
The government-owned company’s Market Demand Strategy (MDS) will see it invest R300 billion on capital projects over a seven-year period. The strategy is designed to expand South Africa’s rail, port and pipelines infrastructure, resulting in a significant increase in freight volumes, especially in commodities such as iron ore, coal and manganese. It will also lead to a significant modal shift from road to rail, the company said.
The MDS will transform Transnet Freight Rail (TFR), which has the lion’s share of the investment programme, into the world’s fifth biggest rail freight company. Rail volumes will increase from approximately 200 million tons to 350 million tons during the period; and by 2019, it is expected that TFR will increase its market share of container traffic from its current 79 per cent to 92 per cent.
In addition, the shift from road to rail will address issues surrounding costs, congestion and carbon emissions, Transnet said.
Other features of the strategy include expansion of export coal from 68 million tons per annum (mtpa) to 97.5 mtpa, and expansion of export iron ore from 53 mtpa to 82.5 mtpa. Container volumes handled through the ports are projected to increase from 4.3 million to 7.6 million twenty-foot equivalent unit containers (TEUs).
Another area set to benefit from the MDS is employment. Transnet said its employee headcount will peak at 74,000 in 2018/19, with the total number of jobs expected to be created via the MDS to be 588,000, which includes direct, indirect and economy-wide jobs.
Spending on training will total R7.7 billion by 2018/19, including R4.7 billion on bursaries and grants.
Implementation of the MDS will also see Transnet’s revenue almost triple from R46 billion to R128 billion over the next seven years.
