Abstract
South Africa's port system has undergone significant changes in the last three decades, from being a state department, to a division of a state-owned company, to separating the landlord and operations functions into distinct entities. Both entities however remain divisions of the state-owned company Transnet, which is also the sole owner and operator of the national freight rail system. Competition concerns gave rise to the establishment of the Ports Regulator of South Africa, mainly to achieve economic regulation and equitable access in the ports sector. The question posed in this research is whether further reform is required at present, or whether addressing other aspects impacting on international trade logistics costs require more urgent attention. The research results suggest that port authority and terminal charges contribute only 10% to international trade logistics costs (16% if maritime shipping costs are excluded). We believe that collaboratively confronting port congestion, bureaucratic import/export requirements and the hinterland feeder system could unlock much more value for stakeholders in the short to medium term, instead of allocating scarce resources to the administrative task of port reform per se, without a clear understanding of the role of ports in the total national logistics system. The fact that it is challenging to engineer, and act upon, such an understanding should not be a deterrent to at least attempt a strategic infrastructure view for a national economy, which does not exclude the possibility of further reform in the longer term.
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More From: Research in Transportation Business & Management
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