Delays at the Port of Cape Town threaten to deeply affect economic recovery and growth for the Western Cape. Provincial government is calling on Minister of Public Enterprises Pravin Gordhan to intervene in the matter.
As a result of the COVID-19 pandemic, the Port has been sitting with a backlog of vessels and has been experiencing operational issues since the beginning of April. All four major South African exporting ports experienced disruptions in early April, but Transnet has since boosted capacity at the Durban, Port Elizabeth, and Ngqura terminals to 100% and eliminated berthing delays by the end of the month, says the Citrus Growers Association of South Africa.
In mid-June, the service level for the Port of Cape Town was only 42% of the average for last year, in terms of containers moved.
According to the Western Cape government, vessels have been waiting outside the port for two weeks before they could berth and some export orders from three months ago have not been shipped yet. Several importers have been waiting for more than a month after the delivery date to receive their containers, and transporters are often able to deliver or collect only one container per day, which is not financially sustainable.
Large volumes of South African citrus that are usually exported from the Port of Cape Town are now being sent to Eastern Cape ports for export in the interest of keeping supplies constant. This is a huge loss of revenue for the Western Cape government, and could also further affect the South African economy.
Business Day reports that international trade makes up 59% of the country’s GDP, and that in 2019, close to R2-trillion of goods were shipped. The delays at the ports and borders could greatly impact on international trade, at a time where foreign currency earnings are greatly needed.
“We are very concerned about the operational issues currently being experienced at the Port of Cape Town,” writes the Western Cape government in a statement. “With the announcement that three shipping lines are cancelling calls to Cape Town or implementing a Cape Town congestion surcharge from July, and that large volumes of citrus exports are being redirected to Eastern Cape ports to ensure to continuity in supply to markets, it is clear that urgency and resources are needed if we are to resolve the current operational issues at the Port of Cape Town.
“We are working hard to assist where we can, and address these challenges at the highest level. We have forged strong partnerships with Michelle Phillips, the Acting CEO of Transnet Port Terminals, and her Cape Town management team. The Western Cape Department of Health has also supported interventions to implement health and safety measures in the workplace to stop the spread of COVID-19. Some service level improvements have started to come through since last week and are beginning to gather momentum.”
The Western Cape government is urgently calling on national government to address the operational inefficiencies which are leading to significant delays, further increasing the number of teams operating to get all cranes working in the port. They also want government to address the structural challenges, providing a sufficient equipment fleet over the short to medium-term to get the service level required to meet importer-exporter needs.