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IOL News
2 days ago
- Business
- IOL News
How Barbara Creecy's R66 billion plan aims to transform South Africa's transport sector
Transport Minister Barbara Creecy announces a sweeping R66 billion investment to modernise South Africa's rail, ports, and aviation sectors, aiming to boost economic growth, create jobs, and improve safety. Image: GCIS Transport Minister Barbara Creecy said South Africa's economic outlook faces significant risks, including domestic constraints and global uncertainties. She noted that state-owned entities operate in a challenging environment, and 'this will require leadership and foresight that prioritise the interests of our country and its people.' Creecy delivered this during her budget vote debate, laying out a broad and ambitious reform programme for logistics, freight, aviation, and passenger transport, to be executed over the next four years. Creecy emphasised that the effective implementation of reforms is vital to boost growth and employment. She highlighted that six clear targets will guide progress. 'The first is to ensure that by 2029, 250 million tonnes of freight are carried on the Transnet network,' she said. Other key goals include improving cargo handling at ports to the international benchmark of 30 gross crane moves per hour, achieving 600 million passenger rail journeys by 2030, and moving 42 million passengers and 1.2 million tonnes of air freight through the ACSA network. On road safety, she said: 'We aim to reduce road fatalities by 40% by 2029, so we reach the UN target of halving road accidents by 2030.' Central to the plan is rail reform, with Creecy confirming that by the end of May 2025, PRASA had successfully revitalised 35 out of 40 corridors and sections of service lines, aiming for an ambitious target of 116 million passenger journeys in the current financial year. Funding and competitive pricing are central to expanding PRASA's offerings, with R66.1 billion allocated over the medium term for infrastructure recovery, signalling upgrades, and new trainsets. On the freight side, Creecy noted that the White Paper on National Rail Policy and the National Freight Logistics Roadmap will guide transformation. 'Strategic infrastructure, such as rail and ports, will remain in public ownership as assets belonging to the South African people,' she stressed. She noted that the private sector participation is being formalised through the PSP framework approved by Cabinet in 2023. Transnet will begin issuing procurement requests in August, supported by a Memorandum of Understanding (MOU) with the Development Bank and National Treasury, she said. This includes the creation of an Interim Rail Economic Regulatory Capacity and open access to the rail network to allow third-party operators, which she said will 'improve network utilisation, increase competition and reduce costs.' Video Player is loading. 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Advertisement Next Stay Close ✕ Moreover, Creecy said the aviation sector is set to expand with R21.7 billion allocated to airport infrastructure development and freight terminal upgrades. A new panel of aviation experts and licensing council appointments are strengthening governance and oversight. 'Substantial progress is also in evidence with regard to building the AT&S internal training pipeline,' she said. ''Since February 2025, 37 successful recruitments have been made in key areas, ranging from air traffic controllers, investigation and safety specialists, engineering instructors, and programme simulators.'' Creecy also praised the turnaround of South African Airways, stating, 'According to the study, SAA contributed R9.1 billion to South Africa's GDP in the 2023/2024 financial year,' and reported a profit of R252 billion in 2022/2023, its first since 2012. The airline is self-funding operations and exploring a strategic equity partner. Addressing road safety, Creecy said the government aims to reduce road fatalities by 40% by 2029. She confirmed that SANRAL had taken over 3,099 km of provincial roads for upgrade and maintenance. On the driver's licence backlog, she acknowledged delays and said: "It is a matter of public record that we have taken this process on self-review to the courts." The taxi sector will also be targeted for reform, with Creecy stressing the importance of formalisation and self-regulation. 'Existing taxi associations have a fundamental and important role to play in self-regulation and governance,' she said. She said the department is working with the industry to align operator licences with loan repayment terms and reduce vehicle financing costs. Creecy said the Department of Transport is the shareholder representative for 16 SOEs and is developing a standard accountability model to ensure better governance, financial stability, and operational capabilities. 'The entities under the Department of Transport are vital to delivering public value to our citizens,'' she said. Get your news on the go, click here to join the IOL News WhatsApp channel IOL Politics
IOL News
04-06-2025
- Business
- IOL News
SPAR Group's growth plans in Southern Africa amid divestment plans in Europe
Spar Group achieved three key milestones in the 26 weeks: the disposal of SPAR Poland was concluded in January 2025, the group's debt restructure was completed in March 2025, and in May 2025 the group announced its intention to dispose of its operations in Switzerland as well as AWG in the UK. Image: Independent Newspapers The SPAR Group, which is divesting of some of its businesses in Europe, plans to grow in Southern Africa by enhancing its retail segments, leveraging partnerships with Uber Eats and Vida e Caffè, and increasing private label product penetration. The retailer outlined its strategy for Southern Africa at the release on Wednesday of its interim results for the 26 weeks to March 28, which showed headline earnings a share falling by 0.4% to 450.1 cents. Revenue was flat at R66.1 billion (R66.2bn). Operating profit before extraordinary items grew by 1.6% to R1.46bn. South African operating profit increased by 5.5%, with the operating margin improving to 2%, up from 1.9%. The interim dividend was passed due to the ongoing restructuring and in line with capital allocation priorities, directors said. Following a board decision to realise value from operations in Switzerland and the UK, these were now classified as discontinued assets in the results. In Southern Africa, investment in customer convenience was being stepped up with the continuing rollout of its on-demand digital platforms, SPAR2U and Build it 2U. The partnership with Uber Eats, launched in the first quarter, was live in 130 stores, and SPAR Group CEO Angelo Swartz said this has enabled SPAR to reach new customers and enhance customer experience. Investment in pharmacist training facilities is underway to support the growth of SPAR Health, with the aim of doubling the pharmacy network by 2028. 'Over the period, we made deliberate progress against the milestones we set to simplify and optimise our portfolio and strengthen our balance sheet,' said Swartz. He said the results showed continued margin recovery, strong cost discipline, and further progress on portfolio optimisation. 'This positions us well to harness future opportunities. Looking ahead, our focus is on further margin improvement, executing effectively in our core markets, and delivering on the remaining elements of our strategic reset,' he added. Revenue growth in South Africa was 1.7%, while in Ireland it was -0.6% in local currency, reflecting the pressure on consumer spending, compounded by low food inflation and the timing of Easter, which fell in the second half of the financial year. The growth that there was, was underpinned by strong momentum in the lower-income customer segment. The Build it and SPAR Health businesses gained traction. Build it, one of South Africa's largest building materials retail brands, increased sales by 4.1% and retail like-for-like growth of 5.4%, despite the tough economic conditions and unseasonal rainfall. SPAR Health grew revenue by 13.7%, driven by strong gains in Wholesale and Scriptwise. Loyalty improved to 58%, up from 53.2% in the year to September 30, 2023. Swartz said they drove profitability through category mix optimisation and private label growth, with improved efficiencies. He expected continued margin improvement in the second half as efficiency initiatives gain further traction. In Ireland, BWG Group was expanding its own-brand offering, sharpening everyday value, and growing its food services business. This was supported by range and pricing optimisation in high-margin categories, increased logistics capacity, modern store formats, and targeted acquisition opportunities.
