Exxaro CEO on Transnet's operational impact on mining

In a recent interview with CNBC Africa, Dr. Nombasa Tsengwa, CEO at Exxaro, discussed the current state of the South African state-owned rail and logistics group, Transnet. The company has been facing multiple challenges, including calls for the CEO to step down from the Mineral's Council of South Africa and a recent impasse in talks with a Chinese rail equipment manufacturer. These issues have had a significant impact on the mining operations of locally listed companies, with stakeholders across the board feeling the pinch. Despite the challenges, Dr. Tsengwa remains optimistic about the future of Transnet. She highlighted the industry's strides in engaging the right stakeholders, including government and Transnet leadership. Dr. Tsengwa mentioned that the impact of Transnet's rail challenges has been felt by various stakeholders, resulting in lost revenue and threats to the economy and potential investments. However, she noted that there has been progress in collaboration between Transnet and industry players, with a focus on technical solutions. Following engagements with the Mineral's Council and Transnet's board at the end of last year, Dr. Tsengwa stated that there is a panel dedicated to addressing technical issues and an oversight team monitoring the results of the actions taken. She expressed satisfaction with the movement seen since the meetings, indicating improvements in stability and availability of resources compared to the earlier quarters of 2022. One positive development highlighted by Dr. Tsengwa was the resolution of the stalemate with the Chinese rail equipment manufacturer, leading to the availability of spares and a new agreement in place. This breakthrough is expected to improve operations at Transnet and pave the way for further advancements. Addressing the government's interventions, Dr. Tsengwa acknowledged the previous efforts in entities like Eskom and SAA but emphasized the need for quick and effective measures to address the challenges faced by Transnet. She expressed belief in the government's commitment to intervene, considering the impact of the current situation on the country's economy. With the country facing escalating challenges in its rail and logistics sector, Dr. Tsengwa stressed the importance of decisive action from all stakeholders, with government playing a crucial role in leading the way towards sustainable solutions. The collaboration between industry players and Transnet, coupled with potential government interventions, offers hope for a turnaround in the sector, benefiting the mining operations and the broader economy.