Transnet struggles to offload operations as private sector balks at tender conditions

Stephen Grootes interviews Nimrod Mbele, CEO of Knowledge Anchors Group.

Debt-ridden Transnet is struggling to restore freight rail and port capacity, causing huge losses for mining companies unable to get their product to port.

Now, the government-owned rail, port and pipeline company says it is delaying the process of privatising the running of the Ngqura container terminals in the Eastern Cape, as well as the Johannesburg-Durban container corridor.

This is because bidders complained that the conditions attached to the tender were too stringent and costly for the private sector to fully participate, reports BusinessLIVE.

CoCT welcomes Transnet's call for private partnership to boost its port

CEO Michelle Phillips said Transnet's vision to 'maintain, run and invest at Ngqura and the 670km container corridor' would be reworked.

She was speaking at the SA Heavy Haul Association (SAHHA) conference under way in Kempton Park.

A Facebook post says 'timelines for implementing private sector participation initiatives have been plotted for the short- to medium term'.

Transnet in essence needed to review its position in relation to market orientation says Nimrod Mbele, CEO of Knowledge Anchors Group (KAG).

"When it comes to Transnet's balance sheet, as it stands we're looking at over R100 billion in the red, and the interest keeps mounting. The infrastructure that needs to be rehabilitated and the operation of a port is all expensive..."

"Transnet has absolutely no choice at this point but to do a review... and strike a balance that would somehow lure private investors to become active participants."

"However, the scales should not tilt so much on the side of business because the government has a special role to play, bearing in mind that the fundamental role of SOEs is to drive social imperatives."

Nimrod Mbele, CEO - Knowledge Anchors Group