The regeneration of railways in South Africa and intermodal opportunities for the road transport sector

Abstract

Paper presented at the 23rd Annual Southern African Transport Conference 12 - 15 July 2004 "Getting recognition for the importance of transport", CSIR International Convention Centre, Pretoria, South Africa. The current state of rail services in South Africa is a considerable cause for worry. At the same time, heavy vehicle road transport, which has grown disproportionately at the expense of rail, is under increasing criticism from other road users, local authorities, provincial and the central government. Overloaded and unroadworthy vehicles, damage to the road infrastructure, safety and accidents, pollution and energy issues are very much in the public limelight. Government has stated its support for a return of traffic to rail but the rail infrastructure and operating capacity has declined to the extent that it cannot service the requirements of South African business and this is impacting negatively on the country's economy. Government has been talking about Spoornet's recapitalisation for over three years but there have been no significant moves to redress the investment shortfall of the past. This paper reviews the background and the issues which have led to the present state of affairs. In spite of initial public statements of support by government, it now appears that Spoornet may have to raise the necessary funds on the international capital market but it's balance sheet may dampen investor interest. At the same time, the railway unions have vocally critisised any government attempts at privatisation. Yet, Spoornet has been involved as a partner in a number of African privatisation schemes and the question which must be asked, is whether a parastatal can participate as a partner in privatisation projects in countries beyond the South African border, particularly when it is unable to satisfy domestic requirements. This paper details the fundamental policy issues which must be addressed if the rail mode is to be placed in a position of competitive equality with road and it highlights the disparity over user costs between the two overland modes. Unless this is adequately addressed, there will be no way forward for rail and our roads will continue to deteriorate. By comparison, the holistic policy of the Queensland State Government in Australia in creating a balanced transport policy is detailed. Finally, state-of-the-art intermodal concepts and facilities which have been designed to develop the strengths that both rail and road can provide in the increasingly important logistics field are described. This includes the location of Industrial Parks and Intermodal Terminals, and the material handling systems which can be employed to reduce operating costs. In conclusion, this paper outlines the advantages that will accrue to both the rail and road industry, the community and South Africa, if a balanced transport policy with buy-in from stakeholders can be achieved.