Durban - Fixing ailing Transnet has become a major priority for the government but there are already warnings that the entity’s R130 billion debt should not be absorbed by the state.
President Cyril Ramaphosa has set up a national logistics crisis committee to look at Transnet’s weaknesses and to find solutions for urgent interventions.
Transnet recently reported a loss of R5.7 billion in 2022/23 and a drop of 23.6 million tons in rail freight, down to 149.5 million tons.
The Durban Chamber of Commerce and Industry, in a letter signed by chamber chief executive Palesa Phili, wrote to Public Enterprises Minister Pravin Gordhan in September appealing to him to intervene in Transnet’s affairs and for the removal of Transnet CEO Portia Derby and her executive team.
The chamber claimed that Derby and her team were sabotaging businesses because of the port’s inability to provide service delivery.
“We would like to bring to your attention our concern regarding the current chief executive of Transnet Ms Portia Derby and her executive team. The business community of eThekwini has reached a point where we can no longer tolerate her behaviour.”
Derby, Transnet Freight Rail CEO Siza Mzimela and group CFO Nonkululeko Dlamini have all since resigned.
The DA’s Ghaleb Cachalia said Transnet’s request for a bailout is not dissimilar to Eskom, “reflecting an inability to repay its debt and need to borrow more to remain barely operational”.
“Taking their queue from Eskom’s debt relief scheme, where a whopping R254 billion in debt will be transferred to the national balance sheet, Transnet wants the same.
“This plea was reportedly formally submitted to Minister of Public Enterprises, Pravin Gordhan, and Finance Minister Enoch Godongwana during a joint presentation on the so-called turnaround strategy of State-Owned Entities (SOEs).”
Cachalia said the DA remains opposed to the absorption of Eskom’s debt as it recklessly exposes taxpayers to the financial ramifications of governmental mismanagement.
“The same applies to Transnet and every other dysfunctional SOE,” Cachalia said.