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Transnet National Ports Authority (TNPA) staff in Johannesburg and Durban are not the only ones up in arms about a decision to relocate its head office, currently split between the two cities, to a new single HQ at the Eastern Cape’s Port of Ngqura, 20km north of Port Elizabeth.
Organised business bodies in Durban, including the Durban Chamber of Commerce and Industry (DCCI), the KwaZulu-Natal Growth Coalition and the South African Association of Shipping Operators and Agents (Saasoa) have expressed shock and disappointment at the move, saying the industry was not consulted.
This follows TNPA confirming the move in a statement last week.
Staff must now relocate to the Port of Ngqura from April 1.
With Durban being sub-Saharan Africa’s busiest container port, the three bodies have raised concerns that the city has not only been overlooked as the “natural choice” for TNPA’s consolidated office but that the move will also result in the closure of TNPA’s office in the city.
DCCI CEO Palesa Phili tells Moneyweb that the chamber has written to TNPA CEO Pepi Silinga and Transnet Group CEO Portia Derby, with
Public Enterprises Minister Pravin Gordhan’s office, included in the correspondence, hoping to change their minds.
“It is shocking that such a decision was taken without consultation, especially with local business and the shipping industry….
“This move will be detrimental to the Port of Durban. It can’t just have a port manager, it needs executive focus as the country’s busiest port, handling over 60% of container cargo traffic,” she says.
“We hope that this decision is not cast in stone. It does not make logistics sense, especially with the Durban-Johannesburg corridor being the key import and export route for SA. In addition, there are so few flights between Durban and PE, a city that also does not have direct international flights,” adds Phili.
In TNPA’s statement, Silinga noted that the move is part of Transnet (Group’s) “ongoing cost-saving and efficiency initiatives”.
The ports authority claims that the move will bring about savings of approximately R25 million a year from lease agreements for the two offices in Johannesburg and Durban, however, it did not mention the overall cost of the relocation itself.
“Relocation of a head office of any large organisation is a significant business decision that is preceded by serious strategic considerations.
The relocation of a seaport authority’s head office from a landlocked city, closer to its operations, ensures that TNPA serves its customers at the point of execution,” Silinga said.
“It bears reiterating that the strategic decision for the head office of TNPA to locate at one of the SA’s ports dates back over 10 years, which decision was not implemented, for reasons unrelated to the interests of the port authority and/or its customers,” he added.
Moneyweb understands that Durban was in the running to become home to the consolidated head office for TNPA initially when the plan for a new cruise terminal building at the port was first mooted around 2010.
However, there have been delays in developing the terminal, which only got the green light in 2019. The new plan did not include space for TNPA’s head office.
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