South African government wants private companies to fix R500-billion rail and ports disaster

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Even the lucrative coal and iron-ore rail export lines — the poor operation of which is slashing exports by companies including Anglo American and Glencore — may be operated privately, the presidency said.

The South African presidency has a plan to reverse the collapse of a state-run ports and freight-rail sector that’s cost the economy at least $26.7 billion since 2010: hand over most of the responsibility for fixing it to the private sector.

Even the lucrative coal and iron-ore rail export lines — the poor operation of which is slashing exports by companies including Anglo American Plc and Glencore Plc — may be operated privately, the presidency said.The plan is the latest evidence that South Africa’s ruling African National Congress has been forced into backtracking on one of its core tenets — that state companies and investment will lead economic growth — and instead rely on the private sector to arrest the decline of services.

That poor performance, which has been blamed on a shortage of locomotives and cable theft, led lobby groups representing miners and businesses in the key port city of Durban to demand that Transnet’s management be removed. Vincent Magwenya, President Cyril Ramaphosa’s spokesman, declined to comment on the plan, which has been circulated to business and labour leaders and has yet to be released publicly.

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