Cape Town — Finance Minister, Enoch Godongwana, said National Treasury (NT) is considering its options regarding a cash injection for troubled state-owned enterprise, Transnet.
Transnet have faced many struggles in the past, that led to NT granting a R47billion bailout to help ease debts, for which they were given strict conditions for the use of the cash.
“The Minister of Finance has concurred with the Minister of Public Enterprises, Pravin Gordhan, to issue Transnet with a R47 billion guarantee facility effective immediately in support of its recovery plan including meeting its immediate debt obligations,” NT said.
In years gone bay, Transnet has blamed it’s poor operational performances on a shortage of funds on maintenance, vandalism to infrastructure, and internal corruption. Recent challenges have included backlogs at some of the country’s major ports, with NT feeling Transnet is still short on cash, EWN reported.
“We are working with Transnet to understand exactly the nature of the problem. We are still doing the numbers on a day-to-day basis. But key for us is that we need logistics to work. We need logistics to work because it’s quite critical for the economy,” Godongwana said.
According to IOL, Godognwana, who was speaking at a pre-World Economic Forum briefing in Johannesburg, acknowledged Transnet’s R130 billion debt burden and said that they would examine what was really needed to fix the rail company and this in turn would determine if a cash injection would be implemented.
Transnet is also seeking international help in order to address the major backlog and logistical issues at its various port terminals. They issued a number of tenders in order to bring in outside expertise as it fights of major delays at its ports in Durban and Richards Bay.
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Compiled by Matthew Petersen
