Go slow catastrophic to economy

2019-07-18 06:00

THE prolonged illegal go-slow of Transnet Port Terminal employees causes one big manufacturer in the automotive sector to lose an estimated R15-million worth of production per day and is costing the region’s citrus exporting industry between R50-100 million per week.

Nelson Mandela Bay Business Chamber (NMBBC) president Dr Andrew Muir expressed deep concerns about the current impasse at the Port of Ngqura and Port of Port Elizabeth where exporting activities have ground to a halt.

The go-slow started on 28 June 2019 and thus far no concrete solutions have been communicated.

The NMBBC is concerned by the debilitating impact that this impasse has on the local economy as it has a potential of retarding the city’s economic growth trajectory.

“Additionally, it causes reputational damage to companies that have an export footprint and face stiff international competition,” said Dr Muir.

According to him, the automotive sector - when extrapolated to sector level - the numbers are estimated at R42 million losses per day which is catastrophic.

“This is creating a ripple effect for the company as it will be forced to implement costly triple shifts for its thousands of workers to regain lost ground,” said Dr Muir.

Citrus: R50-100 million losses per week

The citrus industry has also been badly affected as it has not been able to transport its perishable goods, putting its international reputation and market share at risk.

“There are reliable estimates that the go-slow is costing the region’s citrus exporting industry between R50-100 million per week,” said Dr Muir.

It is doubtful that some of these companies and sectors will be able to recover from these losses.

Furthermore, loss of productivity as shown by the reduced throughput levels (i.e. 10 containers per hour as opposed to capacity of 60 containers per hour) at both ports, due to lack of maintenance of the cranes and associated equipment, is of great concern.

“We are unsure whether Transnet is following the correct legal dispute resolution mechanism to urgently address the matter,” said Muir.

The citrus industry was forced to dispatch trucks with produce for export to Cape Town whilst Volkswagen South Africa was forced to reduce shifts.

According to VWSA spokesperson Andile Dlamini the go slow has cost the automotive giant to not meet its daily production target of 680 units and resulted in workers being paid on short-time.

“As one of the poorest provinces in South Africa, this region desperately needs economic development,” said Muir.

“Instead, in a Metro with the highest unemployment rate in the country, the down time has forced companies to send staff home. This translates to huge losses in income and wages.” -REPORTER


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