Minister of Transport Barbara Creecy has launched a Request for Information (RFI) to enhance private sector involvement in South Africa’s rail and port freight logistics.

This initiative is a step toward addressing the challenges facing the country's freight system and seeks to tap into private sector investment, skills, and expertise to revitalise and modernise key infrastructure.

At the core of the initiative is the government's commitment to collaborating with the private sector, ensuring that South Africa's rail and port systems resume their pivotal role in driving trade and economic growth.

Creecy emphasised that while strategic infrastructure like rail lines and ports will remain under state ownership, there will be increased competition in terminal operations to encourage private investment and improve infrastructure.

"The efficiency of the logistics system is integral to the functioning of all economies," said Creecy.

"We are launching an online request for information (RFI) to develop an enabling environment for private sector participation and enhanced investment in rail and port infrastructure and operations."

South Africa’s rail and port infrastructure faces substantial challenges, including declining performance, theft and vandalism, and underinvestment. These factors have hindered trade and economic growth, and the government's limited resources have further exacerbated these issues, said Creecy.

Creecy highlighted that the country’s state-owned entities are struggling with infrastructure development and maintenance.

"Together with Transnet, government has received numerous unsolicited proposals from the private sector offering investment, skills, and expertise to support the rehabilitation and reform of our struggling rail and port systems," she said.

This surge in private sector interest has made it clear that broad market engagement is essential before issuing Requests for Proposals (RFPs) later in the year.

''This overwhelming interest has made it clear that the department and Transnet must engage in broad and inclusive market engagement before issuing Requests for Proposals (RFPs) in August. These are not formal procurement processes in themselves but a mechanism to understand and source information from the market.''

The RFI will focus on specific freight corridors, such as the Northern Cape to Saldanha Bulk Minerals Corridor and the Limpopo and Mpumalanga to Richards Bay Bulk Minerals Corridor, aiming to address coal, chrome, iron ore, and manganese exports.

Creecy highlighted that this would also include "complete pit-to-port rail, port, terminal infrastructure, and equipment supporting the transport of these bulk minerals".

Additionally, the RFI addresses the Intermodal Supply Chain PSP Project, which focuses on the container and automotive sectors, and explores the potential for designating South African container ports as a regional transshipment hub.

The RFI phase is a crucial research and consultation process, with all information treated confidentially to inform the development of future PSP projects.

Creecy emphasised that the government seeks to ensure that solutions are effective and sustainable, acknowledging the importance of input from a wide range of stakeholders, including organised labour.

"We are committed to building a 21st-century transport system that strengthens industrial competitiveness, deepens regional integration, and drives inclusive economic growth," Creecy said.

In line with the White Paper on the National Rail Policy, Creecy said the Cabinet approved a Private Sector Participation (PSP) Framework in 2023 to guide private sector involvement in the logistics sector.

She confirmed that the Department of Transport (DoT) is in the final stages of establishing a dedicated PSP Unit to facilitate the procurement of PSP projects.

"We have set up an interim PSP Unit within the Department, comprising a team with extensive expertise in structuring PSP contracts and procurement," she said. This unit has already developed the Rail Freight and Port RFIs in collaboration with Transnet.

The RFI will remain open for submissions from March 24 to May 9, 2025. Following the conclusion of this phase, the Department of Transport and Transnet will issue the formal Requests for Proposals (RFPs), which will enter the formal procurement phase by the end of August 2025.

hope.ntanzi@iol.co.za

Get your news on the go, click here to join the IOL News WhatsApp channel.

IOL News

port operations

Minister Barbara Creecy launches initiative to boost private sector involvement in rail and port logistics