Private sector to the rescue!

The Western Cape is facing an export crisis, and it needs to bring in the cavalry. “With the good rains we have experienced, our agricultural goods for export are anticipated to increase by 25%. This is a wonderful opportunity to increase exports and to bring in more revenue,” reveals Mireille Wenger, Western Cape Minister of Finance and Economic Opportunities.

In direct contrast to this opportunity, there has
been significant deterioration at the Port of Cape Town, particularly when it comes to critical equipment such as rubber-tyred gantries. These are needed to load containers on and off trucks, but they are repeatedly breaking down. This means that as it stands, the Port of Cape Town is not, and will not be, able to keep up with the volume of goods coming in to get them to market in time.

The figures from the port for the first two weeks of October 2023 confirm just how messy the situation has become:

• Vessel waiting time at anchor averaged 4.9 days, versus the target of one day
• Vessel turnaround time averaged 10 days, versus the target of four days
• Containers moved averaged 9,197 twenty-foot equivalent unit (TEUs) containers, versus the target of 20,000
• Truck turnaround time averaged 77 minutes, versus the target of 35 minutes
• Night shift utilisation averaged 13.5%, versus the target of 20%.

“Variance between actual performance and targets is a cause of great concern and is why private sector participation is urgently needed at the Cape Town port, as is currently underway at the ports of Durban and Ngqura,” says Wenger.

The Western Cape government’s research shows that if it can increase the province’s exports by 10%, its GDP will grow by approximately 1%.

 “However, to achieve this growth in exports, we need the port to be our economic partner and for it to be running efficiently with adequate investment in its infrastructure, including vital equipment. Which is why the private sector should be brought in to run the terminal and increase the efficiency at the port,” Wenger contends.

The Western Cape government’s economic action plan, “Growth for Jobs”, aims to triple Western Cape exports by 2035. 

“The only way we can achieve this is if the Port of Cape Town is working and meeting the demands of a growing economy. We understand that it is the private sector that creates jobs, and that it is government’s role to enable the private sector and make it as easy as possible for businesses to operate and to grow,” emphasises Wenger.

Privatisation has been extremely successful elsewhere on the continent. Take, for instance, the privatisation of the Port of Maputo two decades ago. In 2022, the port handled almost 27 million tonnes, a significant increase from the five million tonnes it handled in 2007. Volumes have continued to surge this year.

Cape Town would like to achieve something similar. “Put simply, when our ports work, the whole of South Africa’s economy works, and South Africa cannot wait any longer. It is high time that the private sector is brought in to boost the efficiency of the Port of Cape Town, so we can work together to achieve the kind of breakout economic growth we need to create thousands of new jobs in the province, and in South Africa,” concludes Wenger.

We couldn’t agree more.