Johannesburg - The head of South Africa's logistics group
Transnet said on Thursday that it was "inappropriate" to speak about
a split of the freight rail unit from the group at this time and that the
matter needed more debate before a decision is made.
Quoting proposals by the department of tTransport, a media
report suggested this week that the freight rail unit may be split away to open
the business to the private sector.
"There is a role for the private sector to play ... but
not as radical as suggested," chief eExecutive Brian Molefe told
journalists.
"It would be disastrous," he told reporters in
Johannesburg.
Molefe said that the rail freight business made up more than
half of Transnet's business.
"What is really needed at the moment is capital
investment and maintenance and we think over the next five years we will make a
lot of progress in that and restore the function of the freight business,"
he said.
Molefe said that the matter needed to be debated in public.
Parliament's transport committee heard this week that
Transnet could be stripped of its rail infrastructure assets.
This was based on a proposal by the department of transport
to open the rail sector to private investors. The proposal was to be submitted
to the national planning commission and adopted by cabinet before it could be
implemented, Business Day reported.
This would be aimed at solving the huge investment required
to upgrade South Africa's ageing rail infrastructure which sees many companies
rather choosing to transport goods via trucks, a more expensive option.
"The road freight sector carries 87% of the total
freight in the country," senior transport department official Clement Manyungwana
told MPs.
He said the decline in freight rail over the past decade was
due to, among other things, a lack of investment in rolling stock, a lack of
customer focus, a lack of flexibility and insufficient investment in training,
development and staff by the operator.
The plan by the transport department involved setting up a
separate state-owned rail infrastructure utility to manage the parastatal's
rail infrastructure assets on behalf of the government, and a transport
economic regulator to keep playing fields level between Transnet and other rail
operators.
Manyungwana told the committee that private companies needed
to help run the core railway network.
"Transnet currently has a (capital expenditure) of R110bn over the next five years. The view is, this is not sufficient; let alone the
additional funding that is needed for the railway branchline network.
"Outdated technology within the rail network causes us
to have continuous challenges (compared to) road. But a lack of customer
focus... is one serious, serious challenge that (causes) our rail (freight
operations) to decline," said Manyungwana.