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2050 vision for the Durban to Gauteng Freight Corridor: What this means for Durban?

2050 vision for the Durban to Gauteng Freight Corridor: What this means for Durban? Andrew A. Mather eThekwini Municipality. Presentation outline Context Roads Back of Port Land use High Level Cost Estimates Socio Economic Benefits Critical Decision Matrix Conclusion Recommendation.

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2050 vision for the Durban to Gauteng Freight Corridor: What this means for Durban?

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  1. 2050 vision for the Durban to Gauteng Freight Corridor: What this means for Durban? Andrew A. Mather eThekwini Municipality

  2. Presentation outline Context Roads Back of Port Land use High Level Cost Estimates Socio Economic Benefits Critical Decision Matrix Conclusion Recommendation

  3. CONTEXT

  4. OBJECTIVES The Durban to Gauteng freight corridor forms the backbone of South Africa’s freight transportation network, and is vital in facilitating economic growth for the country and the Southern African region. South Africa’s ability to improve efficiencies and lower logistics costs on the corridor, and to provide freight handling capacity in line with demand, will be critical to the region achieving its short, medium and long term economic objectives.

  5. THE 2050 VISION The 2050 vision provides an integrated solution to the growing expansion requirements of the Durban to Gauteng freight corridor which will form the foundation for the establishment of a Southern African regional freight network. The Durban to Gauteng corridor consists of the following key developmental components: • The Port of Durban • The Durban – Gauteng road corridor • The Durban – Gauteng freight rail corridor • Strategically located logistics hubs and terminals • Supportive local area land use plans

  6. TRANSPORT CORRIDOR COMPONENTS DURBAN to GAUTENG TRANSPORT CORRIDOR PASSENGER TRANSPORTATION FREIGHT TRANSPORTATION & LOGISTICS Rail Air Road Air Road Rail Pipe Port Intermodal Hubs & Terminals Supportive Land Use Planning Passengers and freight share the same infrastructure on the corridor. While at a demand and capacity planning level the development of the corridor considers the integrated impact of the growth of both passengers and freight , the 2050 Vision focuses on Freight transportation and logistics

  7. STRATEGIC ALIGNMENT TO NATIONAL STRATEGIES AND POLICIES • Supports Regional Integration through reinforcing short sea shipping, extending the rail and road corridors into Africa • Public investment leverage opportunity for local development and BBBEE • Addresses aged, & expensive ports & rail • Responds to crumbling infrastructure • Resource Intensive economy • Reduce poverty and inequality through lowering logistics costs and through BBBEE and local development via public investment • Prioritises corridors • Identifies need to reduce logistics costs • Increase rail market share • Competition for the management of container terminals • Long term national freight plan and prioritise corridor development • Implementation of the Transnet Infrastructure Build • Reducing logistics costs improves competitiveness and creates more jobs • Infrastructure investment creates direct and indirect jobs • Addresses backlogs and bottlenecks in logistics • Prioritises corridors • Opportunity for private sector participation in terminal operations

  8. MAJOR PHASES OF DEVELOPMENT The 2050 vision is driven by three major phases of port development: • Phase 1: 2010 – 2020 (current expansions in the Port of Durban) Pier 1 Phase 2, Maydon Wharf, berth deepening, land acquisitions, environmental approvals, interim leasing of airport site, dedicated freight route to N2, construction of phase 1 of airport site dig-out, phase 1 of road and rail expansions, land use plans, phase 1 of hubs and terminals. • Phase 2: 2020 – 2040 (Airport site development) Construction of next phases of airport site dig-out, associated road and rail capacity upgrades, second phase of land-use plans and development of hubs and terminals, environmental approvals, land acquisitions, rail relocations, construction of first phase of Bayhead dig-out. • Phase 3: 2040 – 2050+ (Bayhead development) Construction of next phases of Bayhead dig-out, ongoing associated corridor expansions. The corresponding rail, road, hub and terminal and land-use projects also follow this phasing sequence.

  9. Institutional Framework DoT Minister (National Champion) DoT Director-General (Chairman - Steering Committee) DoT Deputy Director-General: TL&CD Secretariat/PMU Steering Committee Provincial Governments KZN, Gauteng & Free State Presidency & NPC DoT the DTI DPE Treasury Metros/Municipality Jhb & Ethekwini SANRAL RTMC PRASA ACSA Transnet Work Streams Planning & Infrastructure Socio-economic , Finance & Funding Legislation, Policy, Regulation , Compliance & Environment Communication National Champion: Facilitate inter-ministerial alignment and Cabinet approval Steercom Chairperson: Ensure administrative and technical alignment in government Steercom Members: Responsible for sectoral adoption and alignment

  10. INSTITUTIONAL FRAMEWORK: WORKSTREAMS Steering Committee Project Management and Co-ordination Policy, Legislation, Regulatory, Compliance Workstream Socio-economic, Financing and Funding Workstream Communication Workstream Planning + Infra- structure Implementation Workstream • Prepare internal and external communication strategy. • Arrange launch publicity. • Ongoing reporting activities. • Ascertain investment requirements of program. • Advise on funding strategies. • Facilitate securing of funding. • Advise on affordability and sustainability. • Prepare and consolidate infrastructure plans for port, freight and passenger rail, road, terminals and land use. • Drive project delivery to meet objectives. • Advise on PLRC requirements, and ensure compliance. • Facilitate PLRC changes required to support the project.

  11. The 2050 Vision Poster

  12. ROADS

  13. N3 Road Needs * Current investigation underway on an N3 8-lane option and how this could extend the start date of these projects

  14. Phase 1c: Mariannhill to Cato Ridge Port of Durban Phase 1a: Port to Mariannhill Phase 1b: North – South Freight Route Major Road Infrastructure Proposals from Port of Durban to Cato Ridge Legend 2010-2025 : Implementation Phasing : : : Dedicated Road Freight Route

  15. Freight Route Phasing - Roads Phase 1b: North – South Freight Route and Complementary Upgrades Phase 1a: East – West Freight Route: Port to Mariannhill

  16. URBAN PLANNING AND ECONOMIC POTENTIAL ASSESSMENT Broad Land Cover Key Industrial Clusters Industrial Accessibility Typical Route Impact Analyses

  17. BACK OF PORT LAND USE

  18. Back of Port Land Uses

  19. HIGH LEVEL COST ESTIMATES

  20. INDICATIVE COSTS

  21. SOCIO ECONOMIC IMPACT

  22. PRELIMINARY SOCIO-ECONOMIC ANALYSES

  23. Measuring Anticipated Economic Impact of Dig-Out Port Development Order of Magnitude Study

  24. Economic impact cycle

  25. Increases in Economic Demand Demand for construction materials has a positive spin-off on national economy, generates NEW BUSINESS SALES. • Total New Business Sales • Phase 1: R54.3b • Phase 2: R22.6b • Phase 3: R21.3b • Phase 4: R19 2b • TOTAL: R117.6b

  26. Increasing Local Production As business sales increase – this requires a significant increase in local production output, and generates NEW PRODUCTION referred to as GROSS GEOGRAPHIC PRODUCTION. • Total New Production (GGP) • Phase 1: R22.4b • Phase 2: R8.9b • Phase 3: R8.4b • Phase 4: R7.6b • TOTAL: R47.5b

  27. Work Opportunities and Job Creation • More production translates into an increase in the need for Labour • 318 279 temporary work opportunities created through the port construction process and • 63 656 jobs created during 30 year construction phase

  28. Impact on Salaries and Wages during Construction The temporary and permanent employment positions has a significant impact on the level of local salaries and wages. These increase R23.8 billion over the period. • Total New Income Impact • Phase 1: R11.2b • Phase 2: R4.5b • Phase 3: R4.2b • Phase 4: R3.8b • TOTAL: R23.8b

  29. Economic Impact of Dig-Out Port Operations • An anticipated Operational related GDP of R55 615 million (per annum at full operation) equivalent to 2.75% of SA GDP in current 2010 terms. • Job creation of an additional 27 533 jobs created at full operation. • Port and Maritime Business related jobs: 11552 • Petroleum related jobs: 701 • Wider Economy Employment: 15821

  30. CRITICAL DECISIONS MATRIX

  31. CONCLUSION • There is alignment within Government in respect of the role of the corridor, its components and development timeframes. • A Multi sectoral Institutional Structure is in place to monitor and drive a set of critical decisions to ensure capacity is provided in line with demand. • The 2050 Vision is aligned to key national policies and strategies • It provides an aligned, integrated and total solution to the freight transportation needs of the one of the most important economic corridor in the country and Southern Africa

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