Godongwana is Concerned That Transnet Might Follow in the Footsteps of Eskom and Face Similar Challenges.

Finance Minister Enoch Godongwana expressed apprehension that Transnet could replicate the challenges faced by Eskom. He emphasized the prevailing electricity crisis as the primary hindrance to economic growth and voiced concerns that persisting issues in the transport logistics sector could exacerbate the constraints on growth. Godongwana conveyed these concerns while addressing economists in Cape Town on Thursday morning, following the delivery of the final budget for this political term a day earlier.

Having grappled with a stagnant economy for nearly a decade and witnessing a per capita decline in wealth, Godongwana pointed out that he inherited a trio of challenges in efforts to enhance the country’s finances: an electricity crisis, a half-trillion rand debt, and sluggish economic growth. The recent addition of significant transport logistics issues has compounded these challenges.

Cautious about repeating past mistakes, Godongwana emphasized the inadequacy of the Eskom template, where continuous financial injections were made with the hope of resolving the electricity problem. He advocated for a different approach, suggesting that private partnerships should be explored in opening up both the electricity and logistics sectors to address the prevailing issues.

Godongwana acknowledged the need to overcome the mindset that insists on state intervention in all matters, recognizing it as a hindrance. In addressing Transnet’s challenges, he disclosed that Treasury has provided a R47 billion guarantee to aid in resolving liquidity problems and implementing the company’s turnaround plan.