Provincial logistics costs in South Africa’s Western Cape province: Microcosm of national freight logistics challenges

Abstract

Background: Logistics costs are most commonly measured on a national level. An understanding of the provincial logistics landscape can add significant value both to provincial and national policy interventions; such measurements are however scarce. South Africa’s national freight logistics survey points to significant challenges in the structure of the freight transport market, most importantly the dominance of road freight transport on dense, longdistance corridors. The Cape Town-Gauteng corridor is the main economic artery linking the Western Cape province to the rest of the country. Objectives: The provincial government commissioned this research to develop an understanding of the province’s contribution to the national logistics challenges in order to alleviate both provincial and national logistics challenges. Results: The research results provide a distinct description of the key action required – to provide an intermodal solution for the dense flows of fast-moving consumer goods on the Cape Town-Gauteng corridor in order to reduce the significant transport and externality costs related to these flows and reduce exposure to exogenous cost drivers. Conclusion: Collaborative research between government and private industry into appropriate intermodal technologies must be prioritised within the ambit of South Africa’s socioeconomic environment. This shift can be further supported through the internalisation of road transport externalities to enable a total cost decision between modes, as well as through appropriate regulation of the freight transport industry.