![]() The appalling management of the South African railway network has very much contributed to the overburdening of roads, as well as to the great amounts of interprovincial traffic. South Africans instead turn to privately owned bus or long distance shuttle services. Furthermore, the commuter routes in our cities and between our biggest cities are not utilised. This loss is made despite a huge demand for alternative logistics and transport options. Only two Transnet rail lines make a profit. Our extensive railway network is vastly underutilised and inefficient. This is indicative of the ineffectiveness of Transnet. The recent, and very much controversial, Canada-USA fuel pipeline is twice as long, yet it cost 35% of what the Transnet version cost. Costs for this project spiralled from R12.7 billion to R30.4 billion. The clearest and most recent example of the failures of our national transport company is the Transnet Durban-Gauteng fuel pipeline that opened nine years after starting construction. Yet the state-created rail monopoly has only resulted in disinvestment and considerable economic damage. South Africa has the tenth longest rail network in the world. By privatising Eskom, the power-hungry and short-sighted politicians are eliminated from the equation, and are instead replaced with enterprising individuals who are better qualified to provide quality services. South Africa is well placed to reap the benefits from our vast amounts of sunshine and long coastlines for solar and wind power.IPPs that risk capital to develop technologies to produce power should be the competitors of Eskom and not the suppliers where Eskom fails miserably. If the South African power production market is decentralised more capital will naturally flow into more efficient energy alternatives. Independent power producers (IPP’s) in South Africa are our future. This state-owned power producer will continue to fall short of the lowest standards of service and innovation as long as it has the indulgence of a guaranteed income and an insured failure. As with the aviation industry and SAA, Eskom has little incentive to pursue innovation and better service delivery when bailouts are all but guaranteed. The problem is not a management or structural issue at Eskom, but instead a structural flaw of our energy market. One cannot help but wonder at the persistence with which the government continues to pursue failure. Power productionĪs certain is the perpetuity of time, so too is the granting of Eskom bailouts. If the South African government ever decides to take the wise decision to privatise our national airline we will finally see an airline that is dedicated to its customers and not to the deployed boardmembers that sit at the helm of this sinking ship. Rather than following in the footsteps of the eight previous “turnaround” strategies of SAA and wasting R16 billion we should look to the worldwide move towards private and competitive airlines as a model worth following. British Airways, Iberian Air and Air France have all been privatised which in turn led to huge growth and improvement in services. The South African government should look at the successes of airline privatisation as guidance. With each bailout, the airline loses incentive to deliver better quality service. ![]() Notwithstanding the fact that SAA has a horrible profit making history, the airline keeps being bailed out by our government. Unfair competition sanctioned by the South African government is being maintained through keeping SAA as a state-owned company. The Airports Company South Africa has also been partially privatised but the final step still needs to be taken. This greater competition was to the benefit of South African consumers as prices were kept in balance through this market competition, despite SAA being continuously bailed out by the South African government. This deregulation resulted in great growth within the industry and consequently higher levels of competition between various airlines. The South African aviation industry has, to a certain extent, been deregulated since 1991. Below is a list of industries that are overshadowed by state-run monopolies that, if deregulated and privatised, will yield far greater returns to the citizens of South Africa. Time and time again these legislated monopolies bank on taxpayer rands to bail them out of the repurcussions of what seems to be chronic underperformance. ![]() ![]() Entities that are protected by legislation morph into monopolies, resulting in a stifling of competition. For decades many companies have been subject to the control of the remarkably inept South African government, and it is this chokehold of the markets that has landed us in the most dire of circumstances. South Africa has had a murky history with regards to state-owned enterprises. ![]()
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