TRANSPORT: Switch To Safer Modes
Recent Western Cape Business News
As a result of the recent strike action, the South African freight industry is expected to show reduced risk in defaults in the air freight and rail sub-sectors due to companies switching to safer transport modes.
Businesses in the road transport and waste disposal sectors are expected to continue finding difficulty into the first quarter of 2013.
Coface believes the true impact of the mass action will only be apparent in the fourth quarter of 2012.
Due to the lag effect, maritime freight is not expected to show any immediate negative indicators.
The political undertones of the recent strike action has not yet dissipated, increasing the risk of a secondary sympathy strikes as the relevant parties fail to come to any long term agreements needed to quell the unrest.
International investor sentiment is regressing with many investors viewing the current dissatisfaction as early warning signs of South Africa’s own "Arab Spring".
According to the Road Freight Employers Association, “...estimates indicate that employees in this industry are losing in the region of R270-million in wages per week, with around R1,2-billion in turnover being lost by the industry per week."
Trade between South Africa and Zimbabwe hinges mainly on moving goods by road and accounts for 70% of Zimbabwe’s imports. Industrialists in Zimbabwe estimate that the country lost as much as USD100-million a day as a result of SA’s truck drivers’ strike.
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