How privatisation could revitalise Cape Town’s struggling container terminal

Cape Town’s port is grappling with inefficiencies, particularly at the Cape Town Container Terminal (CTCT), which is facing congestion, severe weather disruptions, and underperformance.

Recent reports highlight a 20% drop in fruit exports, largely due to delays at the terminal caused by low crane productivity and weather-related issues, such as frequent wind disruptions.

These inefficiencies are not just a nuisance—they are hampering Cape Town’s ability to compete globally in key sectors like agriculture and manufacturing.

The operational challenges at CTCT have become a critical issue for the city’s economy.

The terminal handles 80% of South Africa’s deciduous fruit exports, yet it operates at just 13 gross crane moves per hour (GCH), far below the global standard of 25-30 GCH.

This productivity gap has led to costly diversions of goods to other ports, adding significant costs to businesses and exporters in the region.

The City’s mayco member for economic growth,  James Vos, recently highlighted this issue, saying, “A major company involved in the movement of fresh produce for export said there was a 20% drop in exports of fruits such as grapes in the current period due to the port’s problems.

While some attempts have been made to improve port infrastructure, these efforts have proven insufficient.

The introduction of new cranes and equipment is a positive step, but it is clear that the public sector lacks the resources and expertise required to modernize Cape Town’s port effectively.

According to Andiswa Mesatywa, a spokesperson for Transnet, weather remains their biggest challenge, with wind impacting CTCT the most.

An aerial shot of the container terminal at the Cape Town Port.

Mesatywa said to address operational efficiency and capacity, Transnet is pursuing key private sector participation (PSP) initiatives that will enable the organisation to market capacity and performance requirements.

This is where private sector involvement becomes crucial.

Research from the Western Cape Department of Economic Development suggests that private sector involvement could have a transformative effect on Cape Town’s port, potentially generating R6 billion in additional exports, creating 20,000 jobs, and contributing over R1.6 billion in tax revenues within just five years.

Such outcomes would not only benefit the local economy but also enhance the port’s global competitiveness, particularly in sectors where efficiency in port operations is crucial.

Vos added: “South Africa’s ports consistently rank among the least efficient globally, which affects trade, jobs, and economic growth.

“More state control is not the answer; more investment, innovation, and expertise are. By bringing in private sector partners, we can modernise the Port of Cape Town, cut delays, and position our city as a world-class trade hub.”

Dawie Roodt.

This move is also supported by economist Dawie Roodt, who believes privatizing this critical asset or introducing regular concessions will drive improvement.

Roodt argued that privatization is the best approach, while acknowledging the challenges of monopolies in privatized sectors, he believes the solution lies in issuing concessions regularly, ensuring that no single private entity has unchecked control.

“Privatizing it is certainly the right thing to do, either through full privatization or selling concessions regularly.”

He added this would bring the efficiency and investment needed to revitalize Cape Town’s port, which is vital for the export of goods like minerals, vehicles, and agricultural products.

The government has taken a step in this direction, with Transport Minister Barbara Creecy confirming that a Request for Information (RFI) will be issued in March to explore private sector interest in port and rail partnerships.

This move is part of the broader push for private sector participation (PSP) initiatives that aim to boost operational efficiency. However, many believe that these efforts must go further, with a more aggressive timeline to ensure private sector involvement is not delayed.

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