CBN ARCHIVE - AUGUST '98:
South Africa - August '98 - Annus horribilis again for Portnet

HE year 1995 was very much an annus horribilis for Portnet. In that year ships waited for up to four days to berth because of a combination of bad planning, industrial action and inefficiency. Shipowners were then forced to threaten congestion surcharges against clients in order to recoup their additional expenses, estimated at up to $20 000 a day. This for sins committed by Portnet.

But the more things change, the more they stay the same.

In May this year, Neels Hubinger, chief executive of the Perishable Products Export Control Board, the biggest user of the port, was moved by sheer desperation to write a letter titled 'A Plea for Action', to Saki Macozoma and Rob Childs, Chief Executives of Transnet and Portnet respectively.

It revolved around the fact that the PPECB had experienced "the most serious delays to shipping in Durban and Cape Town which has resulted in large quantities of fruit leaving South Africa in less than optimum condition, or being sold on the local market at obviously lower prices".

The letter explains to the addressees that this in turn is endangering the livelihood of the new generation of small fruit farmers that have been encouraged by Minister of Agriculture, Derek Hanekom. The letter does not mention the fact that the fruit industry are the largest exporters from the Western Cape.

In addition, Hubinger writes, the PPECB had concluded a contract in 1977 with SAECS (a consortium of shipping lines), to ship a specified quantity of fruit each year until 2001. Each shipment was to reach the marketplace in the United Kingdom and NorthWest Continent within fifteen days, but the delays in berthing SAECS vessels were making it impossible to meet these deadlines. So the PPECB was being forced to use whatever shipping was available, forcing it into a breach of contract with SAECS.

And lest the appeal is lost on Macozoma and Childs, Hubinger goes on to write that "the inability to solve the problems in Cape Town and Durban could result in shipping lines opting for other ports. It would certainly be a disgrace to South Africa if the major lines preferred harbours in neighbouring countries, like Maputo and even Walvis Bay if continuity and productivity could be guaranteed there. This option is already being investigated by shipping lines. The loss in revenue, not to mention jobs would have a disastrous effect on our economy".

As if this were not enough, the Cape Chamber of Commerce's senior deputy director, Albert Schuitmaker has written to Childs of the need to end labour dissatisfaction and inefficiency. His letter indicates that it is not only the fruit export business that is suffering losses at the hands of Portnet when he states that "various industry sectors are reporting losses in the region of R60 million each per month" as a direct result of port shenanigans.

Add this to the direct threat to earnings of the region's largest exporter, fruit, and the evidence is that the port of Cape Town are posing more of a threat to the province's well-being than is conscionable.

The bland words of Charles Kingon, chairman of the Association of Shipping Lines, when he says "the port only looks good because it is not busy", become more ominous when one considers their ramifications. There are many that fear that the wheels could come off the port of Cape Town's operations in the face of an upsurge in business. So far be it from those in the know to rejoice at the prospect of a busy port, they cringe.

The seeds of the port's possible difficulties lie in the belief by personnel that they are functioning satisfactorily and that matters are in hand. The reasons for such smugness? Portnet believe that they have settled the labour action bogey. Also, the new Portnet chief executive, Rob Childs, has somehow instilled in role-players a sense of belief in his abilities, without actually having done anything but appoint some people to posts and find consultants to tell him how to run the parastatal.

In fact, up to June this year he had not even found several new key members of staff yet. This false sense of security has taken deeper root because of the beginning of the traditionally quiet period at the port, around July, and because they have, for a while, gotten away with unsatisfactory levels of productivity. The port has not recently been caught begging because there has been only a gentle increase in the number of ships visiting.

Besides their tardiness in unloading visiting ships, the port would have to seriously consider several other issues which may effect the port's ability to get ships in, unload them and send them out in minimal time. These include allowing an open-gate policy, whereby private hauliers would have the right to enter the harbour area to remove and deposit freight.

Currently Portnet are scoring heavily by imposing an old law designed to protect the antiquated South African Railways and Harbours which forced port users to use Portnet haulage. But a failure to perform has meant that clients forced to use Portnet haulage are also forced to experience delays that quite simply would not be countenanced elsewhere. These clients are becoming restless. In Europe, for instance, it is considered acceptable to deposit containers within a half hour of stipulated times. In Cape Town it is considered acceptable to deliver within days. But this status quo is being challenged by shipping agents and brokers in Durban where they have obtained an interdict against Portnet, opening those tightly closed gates. Portnet however, are appealing in their attempts to close those gates again.

The cartage situation especially impacts upon shipping when ships cannot be berthed and unloaded because there is no place to take containers to. This occurs when the cartage arm is not functioning properly, which it has not been for some time now. Increase the number of containers arriving sharply and the problem of 1995 recurs.

Yet Portnet have a source of guaranteed income via its cartage operations. Any cargo originating from any company within a 125-kilometre radius of the port must use their cartage. Also, any cargo destined for any one within that range must also use the Portnet cartage. Taking into account, for instance, that to move a 20-foot container between the harbour and Claremont will cost R328, the scales of income become daunting. Possibly enough to help considerably towards the settling of an irritating pension deficit?

Apart from the cartage situation, Ron Caris of the Association of Shipping Agents and Brokers (ASABOSA), believes that the cranes should work through winds timed at sixty kilometres an hour, when they automatically switch off, to ninety kilometres an hour. This, he says, would help negate the effects of the wind on Cape Town, which currently causes many delays.

Whether the port will be able to cope with a welcome surge of incoming traffic remains to be seen, but what seems clear is that the port's performance is way below acceptable international standards. When these standards may need to be aspired to, the port may find that it is one bridge too far.