Question NW3305 to the Minister of Public Enterprises
23 November 2023 - NW3305
Cachalia, Mr G K to ask the Minister of Public Enterprises
Whether he has found that the management of the railways, ports and pipelines in the Republic by the unified corporate structure in Transnet, which acts as both infrastructure provider and retailer, is the best business practice; if not, what is the position in this regard; if so, what are the relevant details?
Reply:
According to the information received from Transnet
There are some countries and regions where the management of the railways and logistics interfaces such as ports falls under one authority, this integrated approach can help improve the efficiency of transportation and logistics. One notable example is China, where state-owned companies like China Railway Corporation (CRC) oversee both railway and port operations. Other countries have varying degrees of integration between rail and port management, depending on their specific transportation and economic needs. These varying degrees of integration could be classified into several models, each with different levels of coordination and shared management, ranging from Full Integration models to Public-Private Partnerships models, or models based on geographical proximity (ports and rail situated closely) and models based on the country-specific regulatory frameworks. Another model is that of independent Operations, i.e. where railways, ports and pipelines remain entirely independent of each other with minimal coordination. While the latter may not optimize transportation efficiency, it could be the result of historical structures, regulatory hurdles, or a lack of incentives for integration.
Examples:
- Full Integration: China Railway Corporation (CRC) – high level of integration.
- PPP: United Kingdom (e.g., London Gateway Port involves a partnership between DP World and the UK government).
- Geographic Proximity: Netherlands
- Regulatory Framework: Singapore
- Independent Operations: Russia, has a vast geography (historical and logistical reasons for separation).
In terms of Rail
The separation of the infrastructure manager is currently taking place. This will ensure that equal treatment and access are provided to all operators. The objective of the rail reform white paper is to ensure that the infrastructure manager has no bias towards TFR. Transnet is in the process of setting up an Infrastructure Manager outside Transnet freight Rail which is in line with the rail reform process. Private sector operators will therefore be guaranteed unbiased access to the network.
Remarks: Reply: Approved / Not Approved
Jacky Molisane P J Gordhan, MP
Acting Director-General Minister
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