Zambia, SA work for stronger trade ties

ZAMBIA Railways Limited chief executive officer Christopher Musonda (right) with members of the Zambia, South Africa Business Council during a meeting at Chitima House in Kabwe.

GLOBALLY, railway transport is generally considered as one of the most important innovations that foster economic development and growth as it is an artery of enhancing trade.

In seeking to cement business partnerships between Zambia and South Africa, the railway sector has not been left out.Unlike in Zambia, the railway sector in South Africa has over the past years grown and is contributing effectively to the economy of that country.Zambia Railways Limited (ZRL) is aware of this fact and is working with Transnet SOC Limited of South Africa, which is assisting in supplying wagons to Zambia. The ZRL management has also been exploring ways of engaging companies in South Africa which deals in train and locomotive equipment and other accessories.

Recently, a team representing some companies in South Africa, which is part of the Zambia-South Africa Business Council (ZSABC) visited ZRL infrastructure in Kabwe.Railroad Association chief executive officer Mesela Nhlapo said the visit by representatives of South African companies under the umbrella of ZSABC was meant to form strong bonds with Zambian companies among them ZRL.

The delegations visited the ZRL main workshops in Mutwe wa Nsofu area and the communication control centre at Chitima House, the headquarters of the national railway company.

This does not just give hope to the railway firm in Zambia but also is an eye opener for business houses in South Africa.

“We have seen the facilities and we have seen the projects that are coming up- we know what the needs are.“We are partners with Zambia Railways and we want to assist and provide solutions where we can, but we are not saying that we know everything,” Ms Nhlapo notes. She says companies in Africa should not perpetually be dependent on companies outside the continent for supply of equipment and provision of services.Therefore, it is important for South African and Zambia companies to form strong businesses and trade partnerships. This should not be a situation where one country dominates the other, observes Ms Nhlapo, “This also includes the railway sector.”

While, railway sector is key in driving the economy of a country, it continues to face various hurdles to realise its full potential.

Both South Africa and Zambia are experiencing challenges of unemployment, growing their economies and skills transfer to their citizens.Railroad Association is much aware of the challenges that the railway sector is facing and is advocating for partnerships that benefit local economies and transfer skills. “We need to look for a partnership that also benefits the locals and that’s what we are advocating for,” Ms Nhlapo said.

For ZRL, the railway company is keen in forging such partnerships with business houses from South Africa to boost its operations.ZRL chief executive officer Christopher Musonda notes that Zambia is South Africa’s second biggest trading partner after Nigeria.

ZRL is not sitting idle but taking advantage of the trade relationship to promote partnerships with South African companies to facilitate trade through rail by providing a full logistic chain of commodity or services between the two countries.

Mr Musonda said the visit by companies’ representatives from South Africa led by that country’s Ministry of Trade and Industry director of trade Karabo Modimokwane was important because ZRL management is making strides in revitalising operations.

“They have looked around on what we have and we have told them what we need in terms of investments – in terms of where we fall short,” Mr Musonda said.
And Mr Modimokwane said trade within Africa is critical as part of promoting economic growth in the continent.

Companies in South Africa are looking forward to developing business partnerships with those in Zambia and also other countries.“We must trade among ourselves. The trade balance among us is quiet good and health,” he said.

South Africa’s Ministry of Trade and Industry has identified investment opportunities in areas of railway, logistics, manufacturing and enhancement of trade.

Certainly, interface in trade between South African and Zambian companies is critical as African countries must trade among themselves and ensure that there is balance of trade.

“There is no shortage of water in Zambia. There is exploration of oil, there are resources and there is a highly-skilled educated workforce. Our companies need to be encouraged to set up operations in both countries to benefit our people,” Mr Modimokwane notes.

With the introduction of statutory instrument (SI) number seven of 2018, ZRL needs both local and foreign investments to realise the transportation of 30 per cent of heavy cargo by rail within the country.

ZRL needs to up its game to ensure that it has the capacity to move bulk and heavy commodities from the road to rail. However, for this to happen, the company requires investment in different areas.

“We have explained to them [partners] the expectations of our growth resulting from the growth of the economy and also from the SI, which has legislated that at least that 30 percent of bulk and heavy commodities must start moving from the road to rail,” Mr Musonda said. He is hopeful that there will be follow-ups to see how there will actual the business partnerships.

Surely, railway transport has continued to be a key player in the developed transport market and Zambia should take a leaf from how such countries have been managed.
However, it is important to invest in railway transport to move the country’s diversification agenda and also to satisfy the demands for regional trade.