Issue link: http://read.dmtmag.com/i/531852
I DA U N I V E R S A L M ay -J u n e 2 0 1 5 25 a New Era of Rail step toward South Africa's ambition to accommodate the fi h-largest railway system in the world by 2019. South Africa's focus on freight: from road to rail In 2013, about 734 million tons of freight were moved in South Africa, according to an Oxford Business Group (OBG) report, out of which nearly 71 percent was moved by road, despite the fact that railways make up 80 percent of Africa's infrastructure, according to a PWC report. Now, over the next four years, South Africa will shi its freight from road to rail, cutting both enormous logistical costs and carbon emissions in the process. According to the Market Development Strategy overview, "rail volumes are projected to increase from approximately 200 million tons to 350 million tons" by the end of the program. Given this predicted growth in cargo volumes, the government has also launched the National Infrastructure Plan (NIP), a wide-ranging scheme planning to put 4.3 trillion rand ($407bn) toward new infrastructure and upgrading the existent networks across a vast array of sectors. In particular, the second of its 18 Strategic Integrated Projects looks at improving the rail corridor between Durban and Gauteng, South Africa's main industrial centers. Operating in conjunction with the NIP, the National Transport Master Plan aims to invest R751.74bn ($71.2bn) in infrastructure projects until 2050, with 43 percent of this expected to be dedicated to the rail segment. Increased tonnage by rail will improve the country's overall effi ciency, explains Mike Asefovitz, senior media relations manager at Transnet. "Our aim is to lower the cost of doing business in South Africa. Increasing our effi ciency and becoming a more reliable transporter will trans- pose into the rest of the economy," Asefovitz says. "What we anticipate is that this capital investment will give us an additional 128 million tons of rail volume. So by the end of the seven-year period, we are looking at transporting some 344 million tons of commodities. And that's really what rail is: a bulk business." "Our aim is to lower the cost of doing business in South Africa." "Long distances and big volumes is what make us more cost-eff ective. And this cost- effi ciency gets passed onto the customers." Transforming rail infra- structure will have a direct impact on the country's key industries, in particular mining. One of the initiatives already in place is upping capacity on the country's coal transport line, Asefovitz explains, by running 200 wagon trains instead of the former 100 wagon trains. With the introduction of an additional 1,300 diesel and electric locomotives by 2019, the general freight business is bound to expand and strengthen. e locomotive acquisi- tion deal should also prove to be a signifi cant milestone in the country's ambition for fi nancial autonomy. In keeping with its promise to become an original equipment manufac- turer, all the locomotives, apart from the fi rst 70, will be built in South Africa, using a majority of locally-sourced components and opening up the job market. By 2019, a total of R7,7bn ($631m) will be spent specifi cally on skills development and staff training as part of the market strategy. " e intention is that, with time, we will become an exporter of locomotives," says Asefovitz. "We spent a lot of money on training staff to ensure we have the right staff for the future, and that is going to be our competitive advantage." "We are looking at growing a business, we are looking at becoming the fi h- largest railway in the world, and we are on track to do that." Continued on page 27