Transnet has vowed to continue collaborating with the private sector despite mounting criticism, saying South Africans need to understand and accept that such collaboration is now part of the state-owned entity’s business model.
The remarks were made by Transnet Group chief executive Michelle Phillips on Thursday during the company’s 2026 annual results presentation.
Phillips spoke following Transnet’s January disposal of a 49.9% stake in the Durban Container Terminal to Philippines-based International Container Terminal Services Inc.
Private sector participation is a core component of Operation Vulindlela, which was designed to fast-track structural reforms and scale up private sector investment to fix SA’s critical network industries.
However, her comments drew criticism from economist Duma Gqubule and labour federation Cosatu.
While Gqubule argued that private sector participation amounted to the privatisation of Transnet, Cosatu maintained that government should inject equity into the company rather than sell strategic assets.
“We are often challenged about what we do with the private sector, Phillips said.
“Of course ‘Transneters’ (company employees) can become quite nervous.
“But the importance of collaborating with the private sector reminds us of transacting for value and that is what we will do in Transnet, to continue to transact for value,” she said, adding that the state-owned entity would grow its market share.
Phillips stressed that private sector participation had become a key topic among stakeholders.
She said bringing the private sector on board would inevitably reduce Transnet’s monopoly power.
“And that is why we are separating our businesses, infrastructure and operations and optimising funding.”
Hammering home her point, Phillips said private sector participation would improve efficiencies, help shift freight volumes from road to rail, reduce overall logistics costs and increase value for the country as a whole.
Gqubule said: “Through these Operation Vulindlela structural reforms, the government is selling the family silver.
“The real problem at Transnet is that government needs to take the R150-billion debt off its balance sheet. If they take the debt off its balance sheet, Transnet can afford to do these investments by themselves.
“The Transnet assets, like rail, are not there to earn profit, they are there to facilitate the movement of goods in the economy.”
He argued that Operation Vulindlela was intended to stimulate private sector investment in the economy.
“But the results of Operation Vulindlela are dismal,” Gqubule said.
He added that the reforms were having unintended consequences by increasing costs in the economy and could ultimately lead to business closures.
Cosatu parliamentary coordinator Matthew Parks said: “What’s critical for Cosatu is that Transnet and in particular its infrastructure remains publicly owned. These are strategic economic assets. We would not support their being privatised through the front or the back door.”
Parks said the federation remained concerned about Transnet’s disposal of a 49.9999% stake in its Durban container terminal.
“We remain concerned about it whilst respecting that it is before the courts. We believe the correct approach is to invest in Transnet and not privatise it,” he said.
- Transnet CEO Michelle Phillips stated that collaboration with the private sector is now part of Transnet's business model and plans to continue this approach.
- Transnet sold a 49.9% stake in the Durban Container Terminal to International Container Terminal Services Inc. as part of Operation Vulindlela reforms.
- Economist Duma Gqubule criticized the private sector participation as privatization and argued government should eliminate Transnet's R150-billion debt instead.
- Cosatu opposed the sale of strategic assets like the Durban container terminal stake, advocating for government equity investment rather than privatization.
- Phillips argued that private sector involvement would reduce Transnet's monopoly, improve efficiencies, lower logistics costs, and increase national value.
Transnet has vowed to continue collaborating with the private sector despite mounting criticism, saying
Phillips spoke following Transnet’s January disposal of a 49.9% stake in the Durban Container Terminal to Philippines-based International Container Terminal Services Inc.
Private sector participation is a core component of Operation
However, her comments drew criticism from economist Duma Gqubule and labour federation Cosatu.
While Gqubule argued that private sector participation amounted to the privatisation of Transnet, Cosatu maintained that government should inject equity into the company rather than sell strategic assets.
“We are often challenged about what we do with the private sector, Phillips said.
“Of course ‘Transneters’ (company employees) can become quite nervous.
“But the importance of collaborating with the private sector reminds us of transacting for value and that is what we will do in Transnet, to continue to transact for value,” she said, adding that the state-owned entity would grow its market share.
Phillips stressed that private sector participation had become a key topic among stakeholders.
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Gqubule said: “
“
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He argued that Operation
“But the results of Operation
He added that the reforms were having unintended consequences by increasing costs in the economy and could ultimately lead to business closures.
Cosatu parliamentary coordinator
Parks said the federation remained concerned about Transnet’s disposal of a 49.9999% stake in its Durban container terminal.
“We remain concerned about it whilst respecting that it is before the courts. We believe the correct approach is to invest in Transnet and not privatise it,” he said.
