South Africa to launch National Shipping Company

South Africa has released plans to launch National Shipping Company. This is in response to the vulnerabilities that were highlighted by the supply chain disruptions during the pandemic.

The Department of Transport released the first draft of legislation for the formation of the South African Shipping Company (SASCO) which could be launched as early as 2023. According to the department, the country despite generating a large amount of export cargo doesn’t have a national carrier thus relying fully on foreign shipping companies.

Curbing supply chain disruption

The over reliance on foreigners subjects the country to inability shield South Africa from supply chain disruption, especially during times of natural disaster or international conflict hence the need for the launch. The bill outlines an aggressive plan for SASCO with the objective for the line to participate in the carriage of exports and imports as the preferred national shipping carrier.

It would be overseen by a government minister who would appoint the board of directors and chief executive with the goal of building a company that would be competitive in global trade. In addition to a shipping fleet, the company would also own and operate goods clearance, stevedoring, warehousing, and other logistics infrastructure and services.

The plan calls for the company to engage in a broad range of services including container and bulk cargo, tankers, and feeder service coastal shipping. It would also maintain a bunkering operation. The bill calls for South Africa to acquire a container vessel, both a crude oil and chemical tanker, a multipurpose bulk cargo ship suited for coal and grains, and a smaller coastal shipping vessel. It would also acquire one or more bunker barges.

As part of the proposal to launch the national shipping company, the legislation would authorize the government to acquire ships or existing shipping companies during the incorporation of the South African Shipping Company. The funds for the acquisitions would come from the government as well as South Africa’s Industrial Development Corporation (IDC), but no timeline is set for the establishment of the company. The Department of Transport reports that it will begin this month meeting with stakeholders to explore their interest and commitment to the shipping company.