Trouble at SA’s State Enterprises Impacts Ecommerce.

During November, the news started to leak out that the SA Post Office was in dire straights with over R19bn  ($1bn) in debts and over 1,100 creditors. The R2.5bn bail out provided by Treasury earlier this year, was not even a dent in the debts run up by SAPO, including money owed to many other State-Owned Entities (SEOs) such as TransNet, ESCOM, SAA, as well as to the taxman (SARS), to its own regulator, ICASA, and significantly to its pension and health plan funds. Post Offices around SA are being closed and half the staff (6,000) laid off. This creates a unique challenge for ecommerce, as parcels sent via SAPO are being rerouted to those Post Offices which remain open.

A question then arises – SA was designated by the Universal Postal Union (UPU) as the hub for cross-border ecommerce in Southern Africa. Which country should take on that task?

Much cross-border SA ecommerce depends on shipping, as air freight is often too expensive. Shipping may be slow but sure – but infrastructural problems have now bunged up SA’s ports leading to vast queues of lorries destined for Durban and Richards Bay in particular. In recent weeks, container ships have been bypassing the congested and delay-ridden Cape Town harbour to berth at Port Elizabeth, Durban and Richards Bay. But the influx of vessels has created massive congestion off the Eastern Cape coast. At the beginning of December there were with some 46 000 containers stuck outside the ports, with alone 79 vessels and 61 968 containers remain stuck outside the Durban port. An estimated R7bn worth of goods currently cannot berth in SA. Many freight companies are now re-routing to Maputo – and causing tail backs on the SA/Mozambique border crossings. Meanwhile Mediterranean Shipping Company (MSC)  is charging cargo owners an estimated $210 (R3 850) per shipping container due to congestion and Danish company Maersk has imposed a congestion fee destination (CFD) of between $200 and $400 per shipping container from 1 December .