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African countries ‘avoid SA’s costly ports’

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African countries ‘avoid SA’s costly ports’

African countries ‘avoid SA’s costly ports’
Photo credit: Thinkstock

There is a strong push on the continent to avoid South African ports and “lesson dependence” on the country, Africa Project Access MD Paul Runge said.

The move is driven by economic reasons and not political reasons, he said at the Africa on Track 2014 Summit in Johannesburg on Thursday.

SA’s port charges are among the highest in the world. A study by the regulator found tariffs for the port of Durban to be 874% above the global average for containers.

But if the government’s R1bn port tariff rebate is taken into consideration the tariffs decline to 721%.

A recent World Bank report on SA said lower port charges would improve competitiveness and encourage growth of small and medium-size exporters.

Mr Runge said it is cheaper to move goods through ports such as Maputo than Richards Bay in Kwa-Zulu Natal. But he said Richards Bay would be a good base port for the gas discoveries in the Southern African region.

Mr Runge said it would therefore make sense for Richards Bay to have a regional focus, like the port in Saldanha, as opposed to having only a domestic focus.

International Chamber of Commerce director Patrick Corbin said SA’s ports were very expensive and often had delays. He said the percentage of goods being moved by rail instead of road had declined to 20% from 60%.

He said the investment in the extension of ports should rather be put towards developing an efficient rail system and inland ports.

Mr Corbin, who is also former president of the Johannesburg Chamber of Commerce and Industry, said the chamber was working closely with the United Nations on the Amalty programme to develop the 16 landlocked countries in Africa. Six of the countries are in the Southern African Development Community. The programme emphasises inland ports, which would also decrease transport costs, Mr Corbin said.

Last year the Ports Regulator of SA rejected the Transnet National Ports Authority’s tariff application for this year, blocking plans by the ports operator to boost revenue from bulk commodity exports to make up for cuts to charges on containers moving through the ports, and motor vehicle exports.

In 2012 President Jacob Zuma created a R1bn fund to provide relief for local exporters of manufactured goods after complaints from port users about Transnet’s high tariffs.

The Development Bank of Southern Africa is looking to invest in new ports being built in Africa. The bank’s investment in rail infrastructure is increasing, international division senior investment officer Stephan Bolling said.

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