{"id":186921,"date":"2026-04-14T04:38:33","date_gmt":"2026-04-14T04:38:33","guid":{"rendered":"https:\/\/www.europesays.com\/africa\/186921\/"},"modified":"2026-04-14T04:38:33","modified_gmt":"2026-04-14T04:38:33","slug":"kumba-gives-reality-check-on-slow-transnet-rail-reform","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/africa\/186921\/","title":{"rendered":"Kumba gives reality check on \u2018slow Transnet rail reform\u2019"},"content":{"rendered":"

Progress on Transnet\u2019s decision to bring private capital to its railways has been sluggish, despite the broad welcome the groundbreaking news received when it was announced last year, according to Kumba Iron Ore.<\/p>\n

Reflecting on the outlook for South Africa\u2019s logistics reform agenda in its latest annual report, the country\u2019s biggest miner of iron ore struck a sober tone, saying the utility\u2019s privatisation push will probably take years to yield material benefits.<\/p>\n

(Karen Moolman) <\/p>\n

\u201cThe reform process is progressing, albeit at a slower pace than initially anticipated,\u201d Kumba said.<\/p>\n

\u201cWhile it has been encouraging to see the strong levels of ministerial ownership in this process, the pace of the reform means it will be some time before we see any material benefits from this process,\u201d it said.<\/p>\n

\u201cGiven the complexity of the regulatory reform process, we recognise that this will be a multiyear process.\u201d<\/p>\n

The past two years have been momentous for South Africa\u2019s ports and rails<\/a>. After years of inefficiency and policy uncertainty, the government\u2019s Operation Vulindlela strategy undertook to place logistics at the top of its economic reform agenda.<\/p>\n

The liberalisation agenda signalled a new sense of urgency to policymakers as the state vowed to allow more private capital into logistics, which has struggled to progress under cash-strapped Transnet.<\/p>\n

In late 2024, Transnet split into two businesses, one in charge of managing infrastructure, the other of operations.<\/p>\n

The former is charged with managing the application process for private \u201ctrain operating companies\u201d to buy slots on Transnet\u2019s rail network and with financing the restoration of these railways.<\/p>\n

The agenda faces huge financial obstacles as vast stretches of Transnet\u2019s railways continue to be vandalised or stolen, rendering them inoperable. According to Transnet CEO Michelle Phillips, customers are losing 4.5-million tonnes of goods due to infrastructure theft despite it spending R4bn on private security annually.<\/p>\n

Last year, the utility said it would need R14bn a year over five years to get its ailing network up to standard for private operators. Analysts at Investec put the overall cost of repair at R200bn.<\/p>\n

For Kumba<\/a>, the sluggish pace of infrastructure reform is among the biggest trends in its operating environment with a material impact on its outlook. The pace and complexity of regulatory reform continue to hamper the country\u2019s economic growth, said the group, with the effect \u201ccompounded in recent years by government corruption, mismanagement and underinvestment\u201d.<\/p>\n

\u201cCritical to Kumba\u2019s success is addressing the underperforming rail-to-port infrastructure,\u201d said Kumba chair Terence Goodlace.<\/p>\n

\u201cWhile there have been welcome improvements this year in the stability of the Transnet\u2019s OEC [ore export corridor], as well as early progress towards introducing private sector participation on the freight rail market, we recognise that it will be some time before we see the full benefits of the reform process given its inherent complexity,\u201d he said.<\/p>\n","protected":false},"excerpt":{"rendered":"Progress on Transnet\u2019s decision to bring private capital to its railways has been sluggish, despite the broad welcome…\n","protected":false},"author":2,"featured_media":186922,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[52],"tags":[96008,96007,96006,96010,96003,96011,96014,96013,3519,96009,21581,96012,96005,53865,131,96004,96015,28306],"class_list":{"0":"post-186921","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-south-africa","8":"tag-economic-reform-south-africa","9":"tag-freight-rail","10":"tag-infrastructure-reform","11":"tag-infrastructure-theft","12":"tag-kumba-iron-ore","13":"tag-logistics-bottlenecks","14":"tag-michelle-phillips","15":"tag-mining-sector-logistics","16":"tag-operation-vulindlela","17":"tag-private-sector-participation","18":"tag-privatisation","19":"tag-rail-network-upgrades","20":"tag-rail-reform","21":"tag-regulatory-reform","22":"tag-south-africa","23":"tag-south-africa-logistics","24":"tag-terence-goodlace","25":"tag-transnet"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@africa\/116401216106507624","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/africa\/wp-json\/wp\/v2\/posts\/186921","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/africa\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/africa\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/africa\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/africa\/wp-json\/wp\/v2\/comments?post=186921"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/africa\/wp-json\/wp\/v2\/posts\/186921\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/africa\/wp-json\/wp\/v2\/media\/186922"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/africa\/wp-json\/wp\/v2\/media?parent=186921"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/africa\/wp-json\/wp\/v2\/categories?post=186921"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/africa\/wp-json\/wp\/v2\/tags?post=186921"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}