{"id":741653,"date":"2024-01-11T11:24:12","date_gmt":"2024-01-11T09:24:12","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=741653"},"modified":"2024-01-11T11:24:12","modified_gmt":"2024-01-11T09:24:12","slug":"transnet-and-billionaires-port-plan-hits-a-roadblock","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/government\/741653\/transnet-and-billionaires-port-plan-hits-a-roadblock\/","title":{"rendered":"Transnet and billionaire&#8217;s port plan hits a roadblock"},"content":{"rendered":"\n<p>South Africa\u2019s powerful labour unions could scupper the nation\u2019s plans to sell a stake in sub-Saharan Africa\u2019s biggest container port and have it operated by Filipino billionaire Enrique Razon\u2019s International Container Terminal Services Inc.&nbsp;<\/p>\n\n\n\n<p>The\u00a0United National Transport Union\u00a0and South African Transport and Allied Workers Union are demanding that ICTSI agree to no job cuts for the duration of the 25-year contract, their general secretaries said. <\/p>\n\n\n\n<p>They submitted this and other demands to ICTSI and Transnet SOC Ltd., South Africa\u2019s state port and freight-rail company, before December but say they have yet to get a response. Transnet says it has engaged with them.<\/p>\n\n\n\n<p>\u201cWe doubt they will agree to our conditions,\u201d said Jack Mazibuko, the general secretary of Satawu, who added that his union plans to write to the parties again to demand an answer.<\/p>\n\n\n\n<p>Should the transaction \u2014 announced in July \u2014 be scrapped, it would mean that South Africa\u2019s first attempt to sell an equity stake in one of its struggling ports had failed. The near collapse of rail and port services offered by Transnet is limiting the nation\u2019s exports, reducing its tax revenue and causing growth to stagnate.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-wp-embed is-provider-businesstech wp-block-embed-businesstech\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"wp-embedded-content\" data-secret=\"IIPCzPNBmV\"><a href=\"https:\/\/businesstech.co.za\/news\/government\/741479\/cape-town-pushes-for-port-privatisation\/\">Cape Town pushes for port privatisation<\/a><\/blockquote><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;Cape Town pushes for port privatisation&#8221; &#8212; BusinessTech\" src=\"https:\/\/businesstech.co.za\/news\/government\/741479\/cape-town-pushes-for-port-privatisation\/embed\/#?secret=wRt5DXI0Z0#?secret=IIPCzPNBmV\" data-secret=\"IIPCzPNBmV\" width=\"500\" height=\"282\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe>\n<\/div><\/figure>\n\n\n\n<p>It would also be another setback for Public Enterprises Minister Pravin Gordhan, who has been pushing for more private-sector involvement in a bid to boost the performance of moribund state firms.&nbsp;<\/p>\n\n\n\n<p>The sale of a 51% stake in the once-bankrupt national airline, South African Airways SOC Ltd., has yet to conclude after being announced in February 2022. Last month, Transnet&nbsp;halted&nbsp;a process to allow a private operator to run a key freight-rail artery. The company is behind schedule in moving ahead with plans to have private companies build a new port on the northwest coast, documents&nbsp;seen&nbsp;by Bloomberg show.<\/p>\n\n\n\n<p class=\"has-medium-font-size\"><strong>No job cuts <\/strong><\/p>\n\n\n\n<p>\u201cThe ultimate outcome of this process must enhance the productivity and efficiency of the port terminals,\u201d said Ellis Mnyandu, spokesman for the Department of Public Enterprises, who said while the minister has met the leaders of both unions, the department doesn\u2019t get involved in procurement processes. \u201cThere must be no job losses and the conditions of services must remain the same,\u201d he added.<\/p>\n\n\n\n<p>Many labour unions, including Satawu, are closely aligned with the ruling African National Congress, of which Gordhan is a member.<\/p>\n\n\n\n<p>Under the agreement, ICTSI will pay an undisclosed amount for just under half of Durban Container Terminal Pier 2 and will run and expand the facility, which accounts for three-quarters of the volumes that pass through the port in the southeast of the country and 46% of the nation\u2019s total port traffic.<\/p>\n\n\n\n<p>The plan would be to expand its annual throughput to 2.8 million twenty-foot equivalent units from 2 million currently.&nbsp;<\/p>\n\n\n\n<p>Steven Leshabana, the president of Untu, confirmed the demand. ICTSI declined to comment.&nbsp;<\/p>\n\n\n\n<p>Transnet said it has held numerous consultations with the two unions \u201cprimarily focused on the treatment of employees,\u201d and said workers won\u2019t lose their jobs as they cross over to the joint venture. Expected growth will minimize the risk of future job cuts, the operator said.<\/p>\n\n\n\n<p>Assets at the terminal are currently worth 2.5 billion rand ($134 million), and at the end of the contract, Transnet will buy the shares back from the partner, the South African company said. Before the deal can be concluded, agreements with labour must be finalized and due diligence carried out in ICTSI, Transnet said.&nbsp;<\/p>\n\n\n\n<p>\u201cWhile the value of the planned transaction cannot be disclosed, the value to South Africa is clearly evident,\u201d Transnet said. The terminal \u201chas lost regional and global competitiveness due to outdated infrastructure and operational challenges,\u201d it said, saying the purchase price will be invested in equipment.<\/p>\n\n\n\n<p>In a&nbsp;2022 World Bank index&nbsp;of container-port performance, Durban ranked 341st out of 348 and two other Transnet ports were in the bottom 11.&nbsp;<\/p>\n\n\n\n<p>ICTSI, which operates terminals across six continents, was one of six bidders for the contract, Transnet said in July.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<p><strong>Read<\/strong>: <a href=\"https:\/\/businesstech.co.za\/news\/lifestyle\/741589\/south-africans-can-now-visit-108-countries-visa-free-with-one-new-destination-added\/\" target=\"_blank\" rel=\"noreferrer noopener\">South Africans can now visit 108 countries visa-free \u2013 with one new destination added<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Transnet&#8217;s privatisation plan is facing opposition from unions. <\/p>\n","protected":false},"author":59,"featured_media":734663,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"idle","_sma_x_autopost_error":"","_sma_x_post_id":"","_sma_x_attempts":0,"footnotes":""},"categories":[23],"tags":[26],"class_list":["post-741653","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-government","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/741653","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=741653"}],"version-history":[{"count":2,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/741653\/revisions"}],"predecessor-version":[{"id":741669,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/741653\/revisions\/741669"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/734663"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=741653"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=741653"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=741653"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}