As Transnet National Ports Authority (TNPA) charges ahead to implement several urgent interventions to address backlogs at the Durban port and ease congestion at Richards Bay to reduce the effect on the SA economy, the local arm of the family-owned Dutch defence, shipbuilding, and engineering conglomerate Damen Shipyards Cape Town (DSCT) says SA’s maritime industry has great potential, with the biggest customers in the government sector.
Business Day spoke with DSCT group directors Sefale Montsi and Jos Govaarts, who said consolidated investment in the country’s nautical industry — which has a strategic geographic positioning — would develop a sustainable shipbuilding business in SA that leverages local resources, goods and services on an ongoing basis, resulting in a positive ripple effect.
What is your overview of SA’s maritime industry?
Govaarts: SA has a vast coastline and a significant portion of trade (90%) goes through our ports so they need to be operated 24/7 and kept safe. Global safety issues have brought a lot of traffic around the Cape, and we have to ensure their safety even if they are not docking here. The industry is quite small but is well-positioned to benefit from that and there’s room to grow.
Have the port disruptions been an impediment or an opportunity for Damen? Are you confident of a turnaround?
Govaarts: I’ve seen the plans from TNPA to increase their ship maintenance facilities and birthing facilities. And we are very positive about those developments But there is room for further growth.
Montsi: It’s a mixed bag. And there’s another angle to our relationship with the ports in that they are also our landlord. So we have a very complex and intimate relationship. TNPA has a recovery plan in place in response to those challenges. As part of it they have a marine renewal programme, which we have supported by renewing some of the fleets. We would love to collaborate more and work in partnership to ensure that the facilities that they make available for shipbuilding and ship repair can be raised to the standard that they should be so that we can take advantage of the many vessels that pass by.
Where are the nodes for potential growth in SA?
Montsi: The biggest potential customers are in the government sector and include the navy, TNPA, the department of forestry & fisheries and the police. But they’ve been affected by shrinking budgets. However, our industry is an enabler of other industries and the government is slowly starting to realise this. As a result we see better prospects in time.
There is an incredible opportunity if our country and maybe our region could consolidate their vessel acquisition plans so things are more consistent. SA has an incredibly capable industry with a lot of potential to increase production. The navy acquired three patrol vessels that we’re completing this year. With that as an enabler, we were able to bring a lot more attention from our global partners to the capabilities of the SA maritime industry.
Govaarts: Industrial participation is important for better collaboration. Major component suppliers are often global players and they are seeing our potential. The more we build the more co-operation we have between local and international companies.
We manufacture the ships, but we also look after them throughout their lifetime. This area has the potential to create a lot of jobs because while there are components on board the ships that come from abroad, many are from SA. We see further growth in this area.
How easy or difficult has it been to procure shipbuilding components locally?
Montsi: We design and assemble using as many local components as possible. There are, however, some things that would never make sense to even think about localising because there aren’t economies of scale that would make sense. An example of this is propellers, which are unique to each vessel. If you are not building them at scale then localisation would be difficult.
However, where there are opportunities we are working with the government to localise where we can. The department of trade, industry & competition’s localisation efforts are helping us to ensure we build the best vessels possible. And where there are opportunities, we co-operate to support local business.
• This article has been edited for brevity and clarity.
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