Transnet could cut capex by R50bn

Johannesburg - Transnet might have to cut its planned R300bn capital expenditure programme by R50bn if economic growth proved disappointing or strikes affected the sector‚ CEO Brian Molefe said on Monday.

At present there were no plans to curtail the programme‚ scheduled to take place over the coming seven years‚ he told investors at a conference hosted by Bank of America Merrill Lynch.

"We may have to cut the capex programme by R50 bn but so far we are not taking the decision ... at the moment I think it is unlikely‚" he said.

Transnet's road‚ rail and port expansion projects are the backbone of the government's ambitious infrastructure spending plans and are aimed at boosting economic growth and investment.

Earlier this month‚ Molefe said Transnet's plans were premised on an annual economic growth rate of about 3%. The economy expanded by 2.5% last year and is expected to pick up slightly to 2.7% this year before accelerating to 3.5% next year.

Molefe said that Transnet "did not anticipate going to the government for fiscal transfers‚ subsidies or guarantees" for its capital expenditure programme.