Transnet wage impasse could worsen SA's economy, says freight forwarders body

The SA Association of Freight Forwarders (SAAFF) is concerned about the wage impasse between labour unions and Transnet.

On Saturday, SAAFF CEO Juanita Maree called for an immediate resolution to wage disputes affecting the country's supply chains. Transnet said on Thursday “some employees across its operations are embarking on illegal strike action following non-resolution in the ongoing wage negotiations”.

“Since tabling an initial offer, Transnet has made concerted efforts by improving its wage offer on a further four occasions, in spite of the operational and financial challenges facing the organisation, understanding fully the impact any strike action would have on employees, industry and the economy,” the parastatal said.

“Transnet’s primary focus remains to avoid mass industrial action, as this will have a profound impact on economic activity across all sectors, and urges workers to consider the long-term consequences of the strike on themselves, their colleagues, their families and the SA economy as a whole. Transnet believes that its revised offer is reasonable and fair, and deserves serious consideration given the company’s current operational and financial performance.”

Maree said the impasse could plunge SA into a worse economic crisis.

“As we have learnt during the pandemic, it is absolutely essential for supply chains to be maintained at all times. The SAAFF’s research shows that logistics delays to the supply chain cost our economy between R100m and R1bn per day.”

However, when the whole economic cost of the devastating impact is calculated, the result is significantly more, according to Maree.

“According to the latest Sars merchandise stats, R343bn worth of goods were traded (imports and exports) by the country in August. If we consider that 70% of merchandise is processed via the ocean modality, the current inactivity blocks more than R8bn worth of goods each day.  

“Combined with the ripple effect, the impact is more than the country can absorb, given the current economic climate.”

Maree said the economic extent of this action is not fully understood by decisionmakers.

“The unintended consequences of the port strikes will be far worse than our energy crisis if left unattended, as the shock to our economy could not have come at a worse time.

“Neither Transnet nor labour seem to understand the full extent of the damage: simply put, we cannot run on a contingency plan for any length of time, as the water side and land side are too integrated and spill over into one another.

“A one-day loss in port activity results in operationally a minimum of 10 days of recovery. However, the economic loss has a ripple effect on the economy, resulting in further foreign revenue loss at a time when our balance of trade is steadily deteriorating. Therefore, our estimates are conservative at best and losses will likely run more into the billions per day. If the country and the government do not have money now, they will have much less in seven days. The strike is throttling our economy to the point of no return! We need decisive, urgent action now,” Maree said.

She said international trade remained an essential driver of economic growth and development and job creation.

“Facilitating trade must take place on shared infrastructure via shared responsibilities from all parties. Any failure to facilitate trade has dire consequences for each and every South African.,

“Against the backdrop of low growth, high unemployment and rising living costs, we are doing an injustice to ordinary South Africans by leaving this catastrophic situation unattended. Collectively, SAAFF calls on government and labour to reach a swift resolution to the current impasse, as the time is ripe for decisive leadership on behalf of all constituencies.”

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