Address by Minister of Public Enterprises, Mr Malusi Gigaba on the occasion of the Swazilink Media launch and the Sod-Turning Ceremony, Sandton
12 Jan 2012
It is with a deep sense of pride and excitement that we have assembled here this morning to mark this important and historic milestone of the turning of the sod for the construction of a new 146 km new rail connection from Lothair (SA) to Sidvokodvo (Swaziland).
Indeed, this is an overdue initiative as the rail network has the capability to provide strategic links to landlocked countries and in this regard, it will make a significant contribution towards the realisation of the North-South Corridor.
The rail logistics system is one of the foundations of the Southern African economy.
The minerals-energy complex on which our economy has historically been built is extremely dependent upon rail, not just to remain competitive, but for its very existence. Indeed, the expansion of our mining and resource processing industries, which are key exporters in our economy, is going to depend on the growth of rail capacity and improvement in productivity.
There is sufficient empirical evidence that for Africa to become competitive, and to improve intra-African trade, a concerted effort is required to improve the performance of the Continent’s transport and logistics systems through appropriate policies.
Reducing transport costs would not only lead to improved competitiveness in the international market place, but would also result in lower input, production and consumer costs and ultimately to better economic performance.
Strategies to promote regional integration should involve opening up the North-South corridor through collaborative infrastructure investment and participating in regional energy markets.
Deterrents to regional trade to date, which include inefficient customs procedures, complicated rules of origin and other non-tariff barriers, should be addressed.
Africa’s transportation systems and related infrastructure were conceived and constructed to meet the economic needs of the colonial system and support the minerals-energy complex; they were not intended to support balanced economic development to meet the needs and aspirations of African countries, their peoples and economies.
This has paralysed Africa’s economic development, placed a huge social cost both to the peoples of this region and the rest of the continent. This has translated to loss of investment and meant that we could not create the most needed jobs and income, or improved the standard of living of the African people.
Africa’s competitiveness in the global economy demands that African countries take measures, both individually and collectively, to modernise and transform the continent’s infrastructure systems.
Only a collaborative effort such as we are witnessing here this morning between the various African countries will ensure that Africa achieves the levels of development she requires.
Accordingly, the cooperation between these two State-Owned Enterprises (SOEs) demonstrates the benefits that could be accrued from such cooperation between fellow African countries as well as from intra-regional trade connectivity by linking Africa through regional infrastructure.
It is our view that investment in sound infrastructure is critical to any economic development process and thus impacts on the quality of social development of any country or region and consequently could make a massive dent on poverty and inequality, which is particularly urgent during these difficult global economic times.
Rail transport decreases road damage and congestion while it increases road safety and is more secure, particularly in the transport of hazardous chemicals.
Rail is also a more carbon efficient mode than road and energy efficient. It is an intrinsically cost-effective, more efficient form of transport for large volumes, and is reliable for heavy goods over long distances. So the new link line improves connectivity between South Africa and its neighbours and compliments the existing coal feeder system and other bulk mineral corridors.
This project is deemed a strategic regional investment in that it holds significant advantages in attracting traffic to the Maputo and Richards Bay corridors; providing strategic alternative export corridors – critical to Southern African ports, as well as encouraging economic and rail transport growth in Swaziland.
The capacity created for general freight via this link line will relieve pressure on the Coal Line.
It is envisaged that the speedy resolution of the project, funding, land acquisition and the required environmental approvals for the new and upgrade construction works in SA and Swaziland will determine the final commissioning date of the new route.
We are determined to drive this project hard to ensure its speedy implementation as it will create jobs on both sides, on the South African side, it will further enable the unlocking of the long-awaited Waterberg Coal line.
Issued by: Department of Public Enterprises
12 Jan 2012
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