South Africa: Transnet Requests $2. 2 Billion to Modernize Infrastructure
South Africa is seeking 35 billion rand to modernize Transnet’s rail and port infrastructure, addressing logistics bottlenecks that have constrained exports and economic growth Bringing 11 private rail. . .
South Africa is seeking 35 billion rand to modernize Transnet’s rail and port infrastructure, addressing logistics bottlenecks that have constrained exports and economic growthBringing 11 private rail operators onto the national network could add 24 million tons of freight capacity within about 18 months and support the goal of raising rail volumes to 250 million tons by 2030Transnet’s recovery matters beyond the company itself because stronger rail and port performance could improve mining and industrial exports, supply-chain reliability and South Africa’s broader economic growth prospectsTransnet has requested 35 billion rand, about $2. 2 billion, from South Africa's National Treasury to modernize infrastructure and ease bottlenecks that are hurting exports and weighing on economic growth. Transport Minister Barbara Creecy announced the request on Thursday, Aug. 13. The South African freight and logistics company would receive the funding through the National Treasury's Budget Facility for Infrastructure, or BFI. Rail opens to private operators to ease freight bottlenecksPart of the funding would finance projects running through 2030. These include upgrades to railway lines that will allow 11 private operators awarded train paths on the national rail network in May to begin freight services. Creecy said the integration of the private operators was expected to add 24 million tons of freight capacity to the network, with that target potentially reached within the next 18 months, according to Bloomberg. The selected private operators are ARC South Africa (ARC), The Railway Corporation, TLD Marine, Menar Ports & Rail, Sharp Logistics, Barberry, Grindrod, Minrail, IRACEMA, Motheo Logistics and Interlinks. Their services will cover several key freight categories, including coal, manganese, containers, fuel and general freight. Opening rail freight to private operators is part of a national plan to increase volumes transported by rail from about 180 million tons to 250 million tons by 2030. South Africa's rail freight sector, previously dominated by Transnet, is gradually opening to private operators while the infrastructure remains under public control. The transition is part of a broader reform aimed at improving the country's logistics performance, as network constraints have repeatedly hampered mining and industrial exports. Major investments to restore logistics performanceOther projects aimed at improving Transnet's performance include the introduction of a privately operated floating dock at the Port of Cape Town to expand ship-repair capacity, Creecy said. The company also plans to establish a port community system, a digital platform connecting public- and private-sector stakeholders across the port and enabling the real-time exchange of information to improve vessel and cargo flows. The South African government continues to provide substantial support to Transnet through guarantees and financing aimed at strengthening its liquidity and investment capacity and safeguarding a critical state-owned operator that underpins domestic supply chains and foreign trade. If Transnet were to fail, the consequences could severely disrupt supply chains, mining and industrial exports, and the operation of the national transport system. The company has faced financial constraints and years of underinvestment in infrastructure. Transnet's recovery is therefore seen as critical to reviving an economy that has grown by less than 1% a year on average for more than a decade, with transport constraints regularly cited as a drag on stronger growth. In November 2025, Transnet received 13 billion rand, about $802 million, from the Budget Facility for Infrastructure. Of that amount, 11. 2 billion rand was allocated to rehabilitating rail corridors used to transport iron ore and coal and to improving efficiency at the Durban container terminal. The company said in October 2025 that it planned to invest a total of 127 billion rand, about $7. 84 billion, over five years to modernize its rail and port infrastructure. Walid Kéfi