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South Africa’s Locomotive Shortage Unresolved After China Visit

South Africa’s Locomotive Shortage Unresolved After China Visit
Railway workers walk across train tracks past a locomotive operated by Transnet SOC Ltd. at the company's rail depot in Ermelo, South Africa, on Monday, March 10, 2014. Transnet SOC Ltd., South Africa's ports and rail operator, said it's battling mining companies for influence over coal export port access as their dominance shuts out small black-owned producers. Photographer: Dean Hutton/Bloomberg via Getty Images

South Africa’s Department of Public Enterprises Minister Pravin Gordhan said he’s yet to resolve an impasse with China that’s held up the delivery of locomotives and parts essential to improving the performance of the African nation’s state-owned logistics company.

Transnet SOC Ltd., which operates the nation’s ports, freight-rail network and fuel pipelines, is being plagued by issues including vandalism, crime and a shortage of spare parts that have crimped South Africa’s mineral exports. Gordhan, who’s department is responsible for the company, attempted to resolve one of the problems when he traveled to Asia last month for talks with his Beijing counterpart.

The government is facing “continuous battles” in trying to resolve a dispute with Chinese suppliers of locomotives, he told lawmakers in Cape Town on Friday. “We remain optimistic with regard to that matter.”

Coal Pile-Up | Rail disruptions from mines to Richards Bay Coal Terminal cuts shipments

Gordhan planned to discuss a dispute between China’s state-owned CRRC Corp. and South Africa’s central bank and tax authority. Relations with the company were already strained because Transnet sought to cancel a deal to buy as many as 1,064 locomotives from the Chinese firm and two other suppliers. CRRC retaliated by withholding spare parts, forcing Transnet to withdraw more than 300 locomotives from service.

Transnet’s declining performance has been costly for miners including Thungela Resources Ltd., Glencore Plc and Sasol Ltd., which exported 50.4 million tons of coal through the Richards Bay Coal Terminal last year — the lowest volume in three decades. Recent disruptions to Transnet’s services on iron-ore and cargo lines have also occurred due to cable theft, hobbling the flow of goods and other commodities.

“The repeated, repeated problems of theft of copper” and other crimes “which we cannot get on top of as the state” is affecting the breadth of state companies, Gordhan said. The Department of Public Enterprises is also responsible for companies including power utility Eskom Holdings SOC Ltd.


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  • Sean Kerr says:

    Overlay this issue with the poor maintenance of the line and constant derailments – its an horrific picture. The additional foreign revenues additional loco’s could provide is staggering. Not to mention the state of the roads to Richards Bay as producers have had to find alternative arrangements.

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