By: Creamer media

“This is the realisation of years of intense collaboration between business and government to improve the performance of the rail network by introducing private operators and investors.

“When we speak of structural reform in logistics, this is what we mean – creating the competitive environment that will drive efficiency, investment and ultimately economic growth. This step is one along the plan that we have been advocating for through the National Logistics Crisis Committee (NLCC),” Mavuso said in her weekly newsletter on August 25.

The announcement came after Finance Minister Enoch Godongwana had addressed BLSA members last week about the importance of urgent structural reform.

“The only way for South Africa to respond to the headwinds we face from the global trade environment and geopolitics is to get our economy to be more efficient and allow for growth. [Creecy]’s announcement delivers on this imperative,” Mavuso said.

She noted that the logistics crisis had cost the South African economy more than R100-billion in lost mining revenue alone. This had led to an unprecedented partnership between organised business and government.

“Through the NLCC, we mobilised over 45 private-sector experts and CEOs to work alongside government in delivering the objectives of the Freight Logistics Roadmap that underpins [Creecy]'s announcement,” she said.

Mavuso noted that part of that included stabilising and improving the performance of Transnet in moving goods down the existing logistics corridors, which was already having an impact.

For example, in July, Kumba Iron Ore reported a 4% increase in ore that it could rail from its mines in the Northern Cape to the Saldanha Bay port. Equipment availability at the port also improved, enabling Kumba to increase sales by 3%.

However, the line still suffered several derailments and the port had unscheduled shutdowns to repair equipment.

“Introducing competition was never going to be easy. Breaking up a monopoly requires political courage, regulatory sophistication and sustained commitment from all stakeholders.

“The fact that we now have 11 new entrants preparing to move 20-million additional tonnes of freight annually from 2026/27, and able to participate in funding for future growth, is testament to what can be achieved when we move beyond the tired rhetoric of public versus private and focus on solutions,” Mavuso said.

Creecy announced that these operators could unlock up to R100-billion in rolling stock investments, which Mavuso said was exactly the kind of private capital injection the South African rail system desperately needed.

“For too long, Transnet has struggled with both operational efficiency and capital constraints leading to deferred rolling stock and infrastructure maintenance, and significant downsizing of local manufacturing capacity. The beauty of this reform is that private operators will bring their own resources – expertise, equipment and, crucially, accountability to customers,” Mavuso said.

She said Creecy’s target of moving 250-million tonnes by rail by 2029 was ambitious but achievable if the momentum could be maintained.

“Compare this to Transnet's current performance of around 160-million tonnes, and you begin to see the transformative potential. Every tonne moved by rail rather than road reduces logistics costs, eases congestion on our highways, improves our environmental footprint and critically drives job creation.

“I am particularly encouraged by the transparent, merit-based evaluation that resulted in these allocations. The establishment of the Interim Rail Economic Regulatory Capacity (IRERC) to manage the consultation process demonstrates the kind of institutional innovation we need across government,” Mavuso said.

She noted that the separation of the Transnet Rail Infrastructure Manager from Transnet Freight Rail, achieved last year, was crucial for this reform to work.

“You cannot have the infrastructure owner also being the dominant operator. It creates inherent conflicts of interest that undermine fair access. This structural separation, which BLSA has long advocated for, finally gives us a fighting chance at competitive rail operations,” Mavuso said.

She conceded, however, that announcing slot allocations was a lot easier than operating trains and that the real test now lay in implementation.

“The conditional award letters requiring Railway Safety Regulator permits, rolling stock readiness and port capacity arrangements are essential safeguards for a system that must work safely and efficiently, but they need to be swiftly delivered.

“We cannot see reforms stall the way we have in the concessioning of the Durban Container Port, with a preferred bidder announced two years ago still not able to proceed because the award is snarled up in court,” Mavuso cautioned.

However, she believed that the opening of ad-hoc applications for additional routes next week, followed by the 2026/27 timetable applications, showed that this was not a one-off exercise but the beginning of a dynamic and responsive allocation system.

“This iterative approach allows us to learn and improve while maintaining momentum,” she said.

Mavuso pointed out that this rail opening needed to be seen alongside the progress being made in port reforms and the work of Operation Vulindlela in accelerating infrastructure improvements.

“The logistics system is interconnected. There is little point in moving goods efficiently by rail if they then sit in port queues for weeks,” she noted.

Mavuso outlined how the reduced vessel waiting times at the Durban port and the improvements in crane productivity and the border efficiency gains at Lebombo all contributed to a logistics ecosystem that could finally start competing globally.

However, she emphasised that rail reform remained the cornerstone because of its capacity and cost advantages for bulk commodities.

“Success in this first phase of rail reform will determine whether we can attract the next wave of private investment needed to modernise our entire transport network. International operators and financiers are watching carefully. They see a country finally serious about structural reform, but they also see the implementation risks that have derailed previous reform efforts,” Mavuso pointed out.

She assured the country that business remained committed to supporting government in making it work.

“We will continue to provide technical expertise through the NLCC and other forums. But we also expect accountability. The targets are clear, the framework is established, and the operators are selected. Now we need tangible investment, the trains moving and the tonnage increasing,” she said.

Mavuso said Creecy’s announcement represented hope.

“Not the naive hope of wishful thinking, but the earned hope that comes from seeing policy translated into practice. After years of decline, South African rail is finally on track for recovery. We must maintain the momentum to complete this transformation,” she said.