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Strategic significance of concessioning the Durban container terminal in the port of Durban.

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The study investigates, with an intension to establish, the strategic significance of concessioning of the Durban Container Terminal in the Port of Durban. A strategic perspective firstly considers the concessioning in the successful terminal of the world from a developed to a developing perspective, the reasons for concessioning, the post-concessioned realization advantages and disadvantages, and the effects on the country concerned. The attempts to concession the Durban Container Terminal by the Minister of Public Enterprises has been withdrawn in 2004 for reason of lack of clarity on many issues and lobbying in this regard from the current terminal operator. There are many factors used to determine why and when and how to concession if such host government economic policy is strategic. Discussions include stakeholder risks and concerns of concessioning. Concessioning is managed by the concessioning agreement, which includes a understanding of performance and risks to the concessionaire and the host government, thereby providing opportunity for both parties to mitigate these risks. Some risks are generic to concessioning for example concessionaires performance, equipment performance etc., and some are country specific for example, host government policies, relationship between host government and multinationals trading bloc, labour unions and factors of productions, is reviewed and evaluated in accordance with a with respect to all stakeholders. In the case of developed countries, with large-scale enterprises looking to internationalise through for example concessioning in a developing country may result in a power struggle. From a host country perspective, when a first world multinational corporation purchases a national asset in a developing country, many conditions need be put in place so that the integrity through management of risk is maintained to protect the developing country from exploitation of resources. South Africa is a developing country and is a relatively small player in world trade, which suggests a weak position in world trade. South Africa from a trade volume perspective does not significant influence on current world trade rules as a single country. The World Trade Organization (WTO) provides international requirements on trading rules with the world's richest countries and trading blocs. The World Bank also supports these rules. The external environmental influences will include the WTO, World Bank and the International Labour Organization (ILO). Local country specific influences are promulgated through the constitution of South Africa and supported through guidelines in NEPAD (New Partnerships for Africa's Development), AU (African Union), National Government Economic Policy to balance industry protection perceived as a barrier to market entry by a foreign multinational corporation. The decision on whether to proceed with concessioning or not will be determined through interpretation of the strategic evaluation of concessioning. This will suggest whether concessioning (privatisation) of state assets or not and will affect the current operator Durban Container Terminal. Concessioning is a real threat to the current operator's survival and depending on the type of concessioning agreement signed may result in the operator ceasing to exist. In evaluating the balance of power of international trade and the country specific requirements respectively, a question arises. It is very complex and can be asked as follows: Do we as South Africans stand tall in developing and implementing our own economic policy or do we open up our markets which may put South African state assets in hands of the large multinationals who will have free reign to possibly monopolize and speculate within our "fragile" economy.


Thesis (MBA)-University of KwaZulu-Natal, Durban, 2005.


Concessions--KwaZulu-Natal--Durban., Container terminals--KwaZulu-Natal--Durban., Theses--Business administration.