Imports Add R13bn to Transnet Costs

THE rising cost of imports has added an extra R13bn to Transnet's five-year capital investment programme, prompting the state-owned freight transport company to revise its initial budget of R65bn.

Transnet said this week that imports made up about 30% of its planned capital expenditure programme. The group, which plans to expand capacity of its ports, railways and pipelines, will now spend R78bn over the next five years.

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An increase in capital expenditure will result in Transnet having to borrow more money in the capital market, a move that will inevitably put pressure on its gearing ratio of 47%.

Author(s): 
Khulu Phasiwe
Publication: 
Business Day (Johannesburg)