Poor rail infrastructure and uncertainty over service levels remain obstacles to private investment in South Africa’s freight rail network, despite progress in the government’s reform programme.
Traxtion CEO James Holley raised these concerns during Creamer Media’s Reform and Recovery: Are South Africa’s rail reforms taking shape and what’s next? webinar on October 14, noting that further investment would depend on the commercial viability of rail operations.
The direction of the reforms had supported Traxtion’s decision to invest in 46 locomotives, Holley said. However, he cautioned that infrastructure shortcomings, outdated operating systems and uncertainty over service performance continued to complicate efforts to secure financing for additional investment.
Investment should prioritise high-volume, revenue-generating corridors rather than attempt to rehabilitate the entire network simultaneously, Afri-Track Railway Construction project manager and adviser Leon Steyn said.
He argued that a phased approach would allow repaired sections to return to service while limiting the scale of the immediate investment required.
Restoring the network would take time, Transport Minister Barbara Creecy acknowledged, emphasising the need to sustain improvements in freight capacity while strengthening the rail system for the long term.
Freight rail capacity had increased by more than 20 million tonnes over the past two years, she said. The government’s focus was on improving the efficiency, reliability and affordability of rail transport.
The latest rail network statement had extended access agreements from 10 to 15 years, giving private operators a longer period of certainty to support investment decisions in locomotives and other rolling stock, Creecy added.
Functioning rail infrastructure was essential to moving mining, agricultural and manufactured goods to processing facilities and export markets, Shell Lubricants technical and services manager Mpho Mokwena said.
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