North-West University: NWU study explores the need to transport more freight via rail
“To effectively and efficiently transport freight from its point of origin to its desired destination across the country and continent, all modes of transport should be utilised,” says Resego Lentlokane, a North-West University (NWU) transport economics graduate in her honours study.
Her study is titled “The Luxembourg rail protocol and potential modal shift of freight from road to rail in South Africa”.
Resego says the aim of the study was to investigate the challenges faced by rail in terms of infrastructure, operations and capital investments., and how these challenges can be overcome to enable the shift from road to rail by using the Luxembourg Rail Protocol.
“Rail transport cannot effectively contribute to the transport sector because it still faces major challenges and constraints. At the same time, our roads cannot handle all the traffic due to infrastructure and operational constraints, not forgetting the environmental impacts,” she adds.
“This is why we should explore the need to transport more freight via rail, using the Luxembourg Rail Protocol to make this shift possible through rolling stock financing, which can increase and improve railway capacity,” says Resego.
The findings of Resego’s study show that rail transport is still challenged despite some maintenance and refurbishment done recently, and that additional improvement is still needed before more freight can be transported.
She says separating infrastructure from operations, providing access to the market, allowing concessions and enabling the government to focus on infrastructure and private investors on operations are some of the issues to consider.
She also suggests that barriers to entry in the rail freight market should be addressed.
“The rail freight market in South Africa is regulated and monopolised, therefore by deregulating the market, it creates an improved and competitive environment.
“There is also a need for rail financing and investments. South Africa needs to adopt the Luxembourg Rail Protocol and unlock capital investments. Further, they need to look for innovative means which are more cost-effective,” says Resego.
More about the Luxembourg Rail Protocol
The Luxembourg Rail Protocol of 26 February 2007 is the result of numerous meetings sponsored by the International Institute for the Unification of Private Law.
It is a world-wide legal framework that recognises and regulates security interests of investors in railway rolling stock. It benefits lenders, lessors and vendors selling under conditional sale agreements and applies to all rolling stock (powered and unpowered railway vehicles). It also creates a common system for repossession of assets on default or insolvency of the debtor, making it particularly helpful in respect of equipment that crosses borders.