A model for a state-owned shipping company in South Africa: lessons from other BRICS countries.

Abstract

A variety of South African goods are exported around the world on foreign vessels. A cursory analysis indicates, inter alia, R 12,8 trillion in global export value was transported between 2012 and 2022 on foreign vessels. This is because South Africa doesn’t run a merchant fleet or has a state-owned shipping company(Franck, 2016). However, the government has published a Bill signalling its intention to establish a state-owned shipping company. Neither the South African Shipping Company Bill, nor government’s maritime policies explain their proposed model for a state-owned shipping company. The study was conducted through a qualitative research methodology and premised on documents collected through the internet and company websites. This study therefore proposes a model suitable for a South African state-owned shipping company; drawing from the members of BRICS, (Brazil, India, China and South Africa). South Africa is the only member of BRICS, without a state-owned shipping company. The study found state-owned shipping companies in BRICS countries were established in the 1940s during the Second World War. At that time South Africa had a state-owned shipping company, Safmarine, which however, was sold privately half a century later. The study found BRICS countries do not have a homogenous model that can be followed by South Africa to establish a similar institution. Each country’s model is unique to their country. Therefore, this study concludes there is no specific model from other BRICS countries that can be followed by South Africa. However, there are lessons which can be drawn from state-owned shipping companies in BRICS. There are further lessons to draw from South Africa itself, on how it established and operated Safmarine for 50 years. These lessons relate to the establishment, operational management, ownership, funding and capitalization models, as well as growth strategies. The study concludes how South Africa can develop its own model of a state-owned shipping company drawing lessons from other BRICS countries.