We’ve got the skills to tackle lo­co­mo­tive up­grades

The Star Early Edition - - WORLD - Mitch Laun­spach

THANKS to our huge and var­ied min­eral re­sources, South Africa has de­vel­oped a world-class in­dus­trial ca­pa­bil­ity over the past 100 years.

It saw the de­vel­op­ment of ma­jor in­dus­trial en­ti­ties such as Is­cor, the Dor­byl Group of com­pa­nies, Eskom, Mid­del­burg Fer­rochrome, Sa­sol and At­lantis Diesel En­gines.

When in­ter­na­tional trade sanc­tions be­gan to bite, the govern­ment and pri­vate sec­tor was quick to gear up for the lo­cal man­u­fac­ture of light and heavy ar­ma­ments.

In­cred­i­bly, within a decade South Africa grew to be one of the largest and most in­no­va­tive man­u­fac­tur­ers of mil­i­tary equip­ment in the world.

Arm­scor was the cen­tral co-or­di­nat­ing hub, sup­plied by hun­dreds of smaller com­pa­nies that had de­vel­oped spe­cific tech­ni­cal abil­i­ties and man­u­fac­tur­ing skills.

Iron­i­cally, a sig­nif­i­cant per­cent­age of our mil­i­tary ex­ports, were to coun­tries that were op­posed to the apartheid regime’s po­lit­i­cal poli­cies,yet ad­mired our de­sign and man­u­fac­tur­ing tal­ents.

Most of th­ese com­pa­nies are still in busi­ness to­day, and they have the skills re­quired to tackle projects such as the lo­co­mo­tive up­grades.

Many other com­pa­nies such as Grindrod and even Transnet En­gi­neer­ing have the ca­pa­bil­ity to man­u­fac­ture most, if not all, of the com­po­nents re­quired for the lo­co­mo­tives.

Why then, were the for­eign bid­ders not re­quired to sup­ply the only tech­ni­cal ex­per­tise re­quired, and up-skill lo­cal peo­ple to do the ac­tual man­u­fac­tur­ing?

This would have left the coun­try with a wealth of skilled and ex­pe­ri­enced tech­ni­cians, once the project had been com­pleted.

From the out­side, the de­ci­sions made by our paras­tatals ap­pear to be de­void of all fi­nan­cial logic.

We have the min­eral re­sources re­quired in abun­dance, we have the in­dus­trial ca­pac­ity and huge num­bers of peo­ple, some highly qual­i­fied, des­per­ate for any type of em­ploy­ment, and yet we out­source ev­ery­thing to for­eign com­pa­nies, at a huge cost to the tax­payer.

It did not make sense.

Un­til now. If the bulk of this project had been awarded to lo­cal com­pa­nies, us­ing South African min­eral re­sources and pro­vid­ing thou­sands of jobs for lo­cal peo­ple, it would have been im­pos­si­ble to di­vert a large per­cent­age of our tax rev­enue to for­eign com­pa­nies, and from there into the pock­ets of the Gup­tas and the Zuma fam­ily.

Transnet could have ne­go­ti­ated di­rectly with the com­pa­nies ten­der­ing for the sup­ply of lo­co­mo­tives. In­stead, they chose to ne­go­ti­ate the deal with China South Rail (CSR) via a sep­a­rate en­tity named Te­questa, for an ad­vi­sory fee of 21%.

What this es­sen­tially means is that Te­questa earns R10 mil­lion for ev­ery lo­co­mo­tive that China South Rail sup­plies to Transnet.

Over the pe­riod of the con­tract, the Gupta con­trolled com­pany will be paid R5.3 bil­lion by the tax­payer, purely for act­ing as an “ad­vi­sor” in the deal, some­thing for which Transnet them­selves lacked the abil­ity in-house.

As some­one who voted for the ANC in the last elec­tion, in the belief that they would cre­ate jobs for the masses lo­cally, how does that make you feel? No­ord­heuwel, Mo­gale City

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