N3: An economic artery under threat?

Ongoing trouble on the N3 is costing Mzansi its reputation as a route for moving goods into and out of Africa. It is also a threat to food security as goods end up delayed or destroyed.

The CEO of the Road Freight Association, Gavin Kelly, sent out an urgent call for a “solid and lasting solution to bring an end to the continuous disruption of the N3 route”. This, as the main artery between the country’s biggest port in Durban, the economic hub of Gauteng and neighbouring countries has been blocked last week for the umpteenth time.

Following the latest of the sporadic blockages, 12 protesting truckers are now facing charges of economic sabotage for illegally blocking the national road. The arrested drivers appeared in court on Monday (6 December 2021) and were denied bail. They are now due to reappear in court on 13 December.

Their actions reportedly stem from recurring grievances against the hiring of foreign nationals by truck companies in South Africa, and come with July’s eight days of violence and N3 disruptions just five months in the past.

According to Kelly, the ongoing sporadic protests were a threat to food security as some of the delayed products end up being destroyed or turned back. There is also a significant impact on farmers who rely solely on their produce being transported to and sold at bigger markets.

He says that, should the protests continue unabated, the economy could be negatively affected, leading to job losses and investor confidence shrinking. “We are fast losing any respect as a safe, efficient and desirable route for the movement of goods out of, and into, Africa – and even South Africa.”

Huge short-term losses and long-term damage

“Large vehicles cost R5 000 per day [to operate] in terms of fixed costs, driver wages, financing costs and licensing.

“When vehicles are not earning revenue, this cost continues as a cost into the company. The operational costs may drop as the vehicle is not moving but other costs may come into play.”

Companies are further squeezed when they are penalised for late delivery. Then there are costs such as a demurrage (a penalty charge from shipping companies) added to international freight movement shipping costs, as well as non-acceptance of loads, loss of loads due to spoiling, looting and damage to vehicles, Kelly explains.

The long-term effects of the protest actions were not good for South African businesses.

“Long term effects are the loss of business or loads through South Africa and the impact on the businesses that supply into the freight and logistics chains,” he says.

“A single day of stoppage (as happened) can run into millions of rand or, depending on the type of damages and penalties suffered, even into tens of millions of rand.”

The losses in numbers

To illustrate the enormous costs of disruptions along the vital transport corridor, the association has put together statistics on the July unrest episode.

• 255 trucks to the value of R382 million were burnt or destroyed without completion of deliveries.
• The goods on trucks destroyed was worth around R400 million, with many more trucks having minor damages.
• 461 000 fewer long-distance trips were made in July (14 900 fewer trips per day).
• 1.5 million fewer short-distance delivery trips were made.
• Goods worth about R100 billion were delayed along coast-to-Gauteng corridors.
• 10% of the delayed goods were on their way to other African countries.
• R1 billion in goods were destroyed due to delays.
• R2,5 billion in wages were lost or paid without a delivery note.

Kelly explains that there is a great need to find a solid and lasting solution to bring an end to the continuous disruption of the N3 route.

In the meantime, government has set up an inter-ministerial task team to deal with the continuous and at times violent protests by truck drivers in KwaZulu-Natal.

Roughly 3 500 vehicles from different industries such as manufacturing, processing, delivering, retail and distribution centres make use the N3 every day.

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