TRANSNET, the state-owned ports and rail company which is investing R300bn in capacity over the next seven years, would release the much-awaited details for its tender for the acquisition of more than 1300 new locomotives within the next month or two, Transnet Group CEO Brian Molefe said last week.
Manufacturers such as French power and transport giant Alstom and US behemoth General Electric have expressed interest in bidding to supply the locomotives.
By announcing a large locomotive acquisition programme - its largest order in the recent past was for just 100 locomotives - Transnet is responding to the government's demands that state-owned entities move towards longer-term procurement cycles.
The Department of Public Enterprises, Transnet's shareholder and the key ministry behind the government's new infrastructure-led economic development plan, has insisted state-owned enterprises tackle supplier-development needs in all tenders by providing long-term demand certainty. This condition aims to encourage suppliers to invest in knowledge transfer, training and local manufacturing capacity.
The Department of Public Enterprises has already had some success with Transnet and power utility Eskom, which have been running competitive supplier-development programmes for the past few years with the construction of two coal-fired power stations by Eskom and the acquisition of diesel locomotives by Transnet.
Transnet Rail Engineering, the train-building unit of Transnet, said last week its joint venture with General Electric was ahead of schedule and had delivered 50 of the 143 locomotives being bought by Transnet Freight Rail. The contract will be completed by the middle of next year at which point the joint venture will need additional orders to keep production going.
Beyond the seven-year investment window lies a long-term vision for positioning SA as an integrated provider of engineering, project management and logistics services on the African continent.
It aims to become an African champion that will be able to supply the goods and services to African operators and government s.
On the sidelines of the African National Congress policy conference last week, Public Enterprises Minister Malusi Gigaba said the government planned to announce an African expansion strategy for all SA's state-owned enterprises.
"They already have projects they are doing on the continent and we're going to continue to support those," Mr Gigaba said.
"We must also launch a strategy so that we have a directed programme, not an ad-hoc programme which we can't evaluate and monitor. This can be used to promote SA's diplomacy on the continent."
Mr Molefe said that Africa had the lowest intra-regional trade globally, but rising investment and the growth of an African middle class would spur demand for more goods and services.
That would force African countries to seek more opportunities to trade with each other, he said.
The pressure for access to each other's markets would require infrastructure investment which would mean larger, more efficient ports, interconnecting railways and a network of pipelines to transport liquids and gases.