As a result, turnover for the year ending this month is expected to be lower than budgeted, he said.
To make matters worse, the volume decline includes trans-shipments, which have grown, masking the real effect of the global crisis.
“If you take them out of the equation then volumes actually declined about 29%,” he said.
The effect was also cushioned by an overall container growth rate of about 6% from April-October last year, but import/export volumes plunged 18% between November and December.
“The real effects of the decline will be felt in the 2010 financial year, especially if the global economy doesn't pick up during the year,” Letsoalo said.
Mike Schussler, a director of Economists.co.za, said the decline was “really dramatic”.
“I have never seen figures like that from Transnet, where I worked as an economist between 1989 and 1997. I have continued to keep my finger on the pulse of Transnet's performance since then but have never seen anything like this.”
Letsoalo said Transnet Port Terminals was banking on a recovery within two years but that this would depend on whether the economies of SA's main trading partners improved. He estimated that the global downtown would last between six months and two years.
Christelle Grobler, an economist with the Bureau for Economic Research, said the economic outlook remained extremely uncertain, with projections for world economic growth for this and next year continuously revised downwards.
“Our forecast for the South African economy currently does not see any material recovery this year, with economic growth picking up only slightly in 2010,” she said. “Our latest estimate for real gross domestic product growth for 2010 is about 2.7%, revised downwards from above 3% levels forecast in January.”
The UK, US, Europe and Japan are all in recession and SA is expected to join the global gloom list when the anticipated third quarter of economic decline is announced in June.
“Transnet Port Terminals is looking at all avenues to reduce costs,” Letsoalo said.
A moratorium has already been placed on all external recruitment, all weekend work and overtime during the week.
“We are also starting to park excess equipment, which is saving fuel and maintenance costs,” Letsoalo said.
Source: Business Day
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