SA firms to get a R16bn slice of Transnet’s capex pie

2011-10-29 09:38

Local suppliers are in line to secure R16 billion of Transnet’s R25.8-billion capital expenditure (capex) ­programme.

Transnet chief executive Brian Molefe, who delivered his maiden interim financial results this week, said the parastatal was aiming to place about 62% of its capital spending in the hands of local suppliers, particularly black-owned companies.

“We buy locomotives and cranes abroad because there is no one in South Africa who manufactures them. However, there are certain parts of the locomotives, apart from the engine technology, that can be found in South Africa, such as rubber and glass. We insist those inputs be sourced locally,” said Molefe.

Since some of Transnet’s capital projects are handled by foreign firms, it has developed a competitive supplier development programme to help local suppliers take advantage of the procurement opportunities presented by its capex programme.

Transnet has spent R86.8 billion in the past five years upgrading the country’s ports and railway lines.

In the past six months, Transnet placed R13.9 billion in the hands of black companies.

Local suppliers are expected to benefit from a contract that Transnet recently awarded to Chinese company Shanghai Zhenhua Heavy Industries to supply ship-to-shore cranes.

“South Africa has a vibrant and developing shipbuilding industry, and we are looking to source tugs (boats that move ships),” said Molefe.

South African companies are also benefiting from a locomotives tender given to US firm General Electric and Japanese company Mitsui.

Molefe revealed that Transnet planned to increase its 55 700-strong workforce by 5 000 over five years.

“We are looking for train drivers and rail engineers to maintain our rail infrastructure, and we are also looking for people to operate new equipment at our harbours.”

He said the parastatal was on a massive drive to train artisans and engineers. Nearly 2 000 cadets had been drafted on a three-year contract to learn skills related to the operation of ports, railways and pipelines.

Molefe, who joined Transnet in February, has done remarkably well considering his short stint at the parastatal. In the six months to September, he lifted the group’s revenue by 20.3% to R22.4 billion. Operating profit rose 25.2% to R5.1 billion.

Join the conversation! encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions. publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Inside News24

Traffic Alerts
There are new stories on the homepage. Click here to see them.


Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.

Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire network.


Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.

Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.