Transnet to roll out R300bn expansion plan

State-owned Transnet will spend R300-billion in a capital-expansion programme to move the transportation of minerals such as coal from roads to rail.

This was announced by President Jacob Zuma during his State of the Nation address in parliament last night.

Zuma said that in terms of the new plan, the transport and logistics group will be making massive improvements to the Durban-Gauteng rail corridor and improve the manganese export channel through the port of Ngqura in Port Elizabeth.

There would also be huge rail infrastructure developments in Limpopo and Mpumalanga, where coal is mined.

The president said that R200-billion would be specifically invested in rail infrastructure, while the remaining R100-billion would be pumped into projects in the ports with the aim of expanding the iron-o re e xport c hannel from 60million tons per year to 82million tons .

"The Market Demand Strategy will result in the creation of more jobs in the South African economy, as well as increased localisation of black economic empowerment," Zuma said.

"It will also position South Africa as a regional trans-shipment hub for sub-Saharan Africa and deliver on Nepad's [the New Partnership for Africa's Development] regional integration agenda," the president said.

Zuma said the government was also exploring measures to drop port charges by R1-billion in a bid to reduce the high cost of doing business.

He told MPs, premiers, MECs and other guests in parliament that the government was considering reducing costs following complaints about high port charges by captains of the automotive industry in Port Elizabeth and Uitenhage during his visit to that region last year.

Vehicle manufacturing firms such as Volkswagen and General Motors are based in the two areas and import and export some of their products.

"In this regard, I am pleased to announce that the Port Regulator and Transnet have agreed to an arrangement which will result in exporters of manufactured goods receiving a significant decrease in port charges during the coming year, equal to about R1-billion in total," Zuma said.

The president also announced that the government had identified infrastructure projects focusing on rail and information technology in provinces that were rich in minerals such as Mpumalanga, Limpopo, North West and the Free State.

Limpopo, which holds vast deposits of minerals such as platinum and houses new Eskom power stations, would get the lion's share of the planned development.

"These efforts are intended to unlock the enormous mineral belt of coal, platinum, palladium, chrome and other minerals in order to facilitate increasing mining as well as stepped-up beneficiation of minerals.

"Using the developments in Limpopo as a base, we will expand rail transport in Mpumalanga, connecting coalfields to power stations," said Zuma.

"This will enable us to decisively shift from road to rail the transportation of coal, which has caused a deterioration of the roads of Mpumalanga."

Zuma said he would convene a presidential infrastructure summit to discuss the roll-out of the "plan with potential investors and social partners".