TRANSPORT AS A MOVER OF THE ECONOMY - Dr Popo Molefe is Chairperson of Transnet
The importance of an efficient transportation system for the movement of goods and people cannot be over-emphasized. The advent of globalization meant that companies and firms operate and trade across continents, countries, cities and regions and that therefore goods, services and people had to move at a speed never seen before.
Technology and communications is another form of transportation that fuels the economy by transmitting information and data across through wireless mechanisms and cables running countries and under the sea. Technological developments that the world has experienced through many decades of research and innovations have contributed to better and efficient production methodologies and a greater understanding of the world we live in. the establishment of the Square Kilometre Area (SKA) in SA is likely to lead to a greater and deeper understanding of the evolution of living and extinct species.
The developments in aviation and marine information and technology led, for instance, among others to the creation of supersonic jets and improved air and sea cargo carriers. This led to quicker transportation of goods and services across countries all over the world.
Human beings are also transporters of information through technology and physical presence in a world where we all live in the global village where executives, managers and employee are deployed at various company sites across the world where it is believed that they make a difference in the entities efficiencies in production, information dissemination or any of such reasons.
Research authors, Doctors Jean-Paul Rodrigue and Theo Notteboom assert in Transportation and Economic Development that the economic importance of the transportation industry can be assessed from a macroeconomic and microeconomic perspective.
At the macroeconomic level the transportation system and mobility mechanisms benefits are linked to a level of output, employment and income within a national economy where. In many developed countries transportation accounts for between 06% and 12% of the Gross National Product (GDP). In these instances logistics costs can account for between 06% and 25% of the GDP and the value of all transportation assets, including infrastructure and vehicles can easily account for half the GDP of an advanced economy.
At the microeconomic level transportation is linked to producer, consumer, and distribution costs. The importance of specific transport activities and infrastructure can be assessed for each sector of the economy. Usually, higher income levels are associated with a greater share of transportation in consumption expenses. Transportation accounts, on average, between 10% and 15% of household expenditures, while it accounts for around 04% of the costs of each unit of output in manufacturing.
In SA the Department of Transport (DoT) is responsible for the legislation and policies for rail, pipelines, roads, airports, harbours and the intermodal operations of public transport and freight. It is also responsible for conducting sector research, formulating legislation and policy to set the strategic direction of subsectors, assigning responsibilities to public entities, regulating through norms and standards, and monitoring and implementation. Chapter Four (4) of the National Development Plan (NDP) calls for the economic infrastructure as the foundation of social and economic development. In short, the policy’s objective is a result of ‘a competitive and responsive economic infrastructure network) of government’.
Transnet, South African Airways (SAA), and the South African Express (SAX) fall under the Department of Public Enterprise as these are classified as commercial role players. Transnet (State Owned Company - SOC) is responsible for a number of transport modes and sites that ferry goods and services across South Africa and into and out of SA. This month the SOC celebrated 110 years of existence. Its mandate is to contribute to lowering the cost of doing business in SA, enable economic growth and ensure security of supply by providing appropriate port, rail and pipeline infrastructure in a cost-effective and efficient manner.
Transnet is the largest freight logistics company in the country enabling competitiveness, growth and the development of the country’s economy by delivering reliable freight transport and handling services that satisfy customer demand.
Transnet National Ports Authority (TNPA) regulates and manages the seven ports from Richards Bay to Saldanha through which products such as coal; manganese; iron ore; motor vehicles and agricultural are exported and imported.
The port terminals through which containers ferried across the country by rail and road are loaded and offloaded at the ports and other container terminal sites such as the one at City Deep in Johannesburg and in Durban are under the management of Transnet Port Terminals (TPT).
Transnet Freight Rail (TFR) is responsible for the rail net that links SA to Botswana, Zimbabwe, Zambia and Swaziland and provinces, cities, towns and regions within SA. TFR runs the longest train in the world with 375 wagons between Thabazimbi and Saldanha and from Sishen to Saldanha.
The fuel that is utilized across SA at various fuel outlets is carried through pipelines managed by Transnet Pipelines (TPL).
Through TFR, TPT and TPL Transnet contributes greatly to economic growth.
South Africa has one of the most developed transport infrastructure on the African continent. The holding of the Soccer World Cup in 2010 provided a further impetus to the transportation infrastructure through the development and improvement of airports and road infrastructure. Unfortunately, the rail infrastructure did not benefit to that extent.
The use of other transportation modes such as drones and scooters have proved during election time in many countries such as the Democratic Republic of Congo (DRC) which has a vast terrain. In SA there are already individual entrepreneurs who use their own personal vehicles to transport commuters to the airport, documents and hardware from one place to another and so on. The possibilities are there for many for small and medium enterprises to invest in such modes of transport.
In general, transport systems have to be efficient and provide desired economic and social opportunities and benefits the world has opened for humanity – in order to be a ‘Reliable Mover of the Economy’.
Equally, and inversely, inefficient and deficient systems provide economic costs or opportunities that may never be recovered – and thus become ‘Immobilisers of the Economy’.