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Subtitle: Shipping costs can be an important determinant of a country's trade growth and associated foreign direct investment. Mihalis Chasomeris questions the common use of IMF cif/fob ratios to compare countries' shipping costs.
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ABSTRACT This study aims to examine how car guarding remains a sustainable means of livelihood in the informal sector. The study interviewed 30 car guards at six different locations in Durban, South Africa. It examined their demographic... more
ABSTRACT This study aims to examine how car guarding remains a sustainable means of livelihood in the informal sector. The study interviewed 30 car guards at six different locations in Durban, South Africa. It examined their demographic characteristics, income, education and skills, among other factors. Furthermore, it compares the findings from 2019 with the 2015 findings from Foster and Chasomeris (2017, Examining car guarding as a livelihood in the informal sector. Local Economy 32(6), 525–538. https://doi.org/10.1177/0269094217727990). The findings show deterioration in the real income levels and livelihoods. In 2015, 22 car guards earned above a domestic worker’s minimum hourly wage of ZAR15, compared to 16 car guards in 2019 and, only eight above the national minimum wage of ZAR20 per hour. There is a notable decline in expenditure on accommodation and reduced optimism about their future. Car guards still display a level of entrepreneurship, especially where daily bay fees are not paid to car guarding agents.
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Car guards are found at many sites where motorists park, including at ticketed pay to park sites. Logic would dictate that most motorists would be less willing to tip car guards when already paying for parking. The study interviewed 15... more
Car guards are found at many sites where motorists park, including at ticketed pay to park sites. Logic would dictate that most motorists would be less willing to tip car guards when already paying for parking. The study interviewed 15 car guards at different ticketed parking sites in Durban. Their demographic characteristics, among other factors were explored. The findings of this study are then presented and compared to the findings pertaining to an additional 30 car guards (also interviewed in 2019) at free to park sites. Car guards at free to park shopping centres work an average of 44.8 h weekly earning an average of ZAR13 hourly. At ticketed parking shopping centres, they work an average of 63.2 h weekly earning an average of ZAR9.50 hourly. At beachfront free to park sites they work an average of 51.2 h weekly earning an average of ZAR19.10 hourly. At ticketed parking beach front sites, they work an average of 65.7 h weekly earning an average of ZAR7.90 hourly. The study revealed that car guards at ticketed parking sites earn less. However, they remain optimistic, and display a level of entrepreneurship, even in the face of daily bay fees, regulations and ticketed parking.
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Transnet National Ports Authority (TNPA) is the landlord and sole provider of marine services in South Africa’s eight commercial ports. Historically, TNPA set port prices for marine (nautical) services below full cost recovery. Price... more
Transnet National Ports Authority (TNPA) is the landlord and sole provider of marine services in South Africa’s eight commercial ports. Historically, TNPA set port prices for marine (nautical) services below full cost recovery. Price regulation has improved the situation, but substantial reforms are still required. This paper revisits marine services pricing in South Africa’s ports. The methodology employed content analysis to analyse 99 stakeholders’ submissions to the Ports Regulator of South Africa from financial years 2013/2014 to 2021/2022. The results are discussed under four categories of themes: concerns about the above-inflation price increase, suggestions on alternative marine services pricing models, concerns about marine services provision and productivity, and the disputed cross-subsidization between ports and port user groups. Despite above-inflation price increases for marine services, tariffs remain 44% below the global benchmarked mean, whilst revenues from cargo ow...
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The South African tea producing industry has been in decline since 2000 due to a host of factors such as significant increases in production costs occasioned by a regulated labor market, unfavorable international tea prices, removal of... more
The South African tea producing industry has been in decline since 2000 due to a host of factors such as significant increases in production costs occasioned by a regulated labor market, unfavorable international tea prices, removal of tariffs and increased competition from African tea producing countries. This culminated in closure of most of the tea estates leaving a few tea estates in precarious financial positions and operating on a stringent budget, funded mainly through government grants. The study focuses on issues affecting the tea industry in South Africa in general, in an attempt to find solutions to the challenges and to establish sustainable business strategies for the industry. Twenty participants were purposively chosen for their knowledge, experience and information about the tea industry in general. High production costs, low skills and labor productivity levels, lack of technical support, removal of tariffs, competition from low cost producing countries, exchange ra...
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The overall purpose of the study is to analyse financial statements to determine the primary purpose of JSE listed companies in the food and drug retail sector. There were two parts to the analyses. First, the study examines the... more
The overall purpose of the study is to analyse financial statements to determine the primary purpose of JSE listed companies in the food and drug retail sector. There were two parts to the analyses. First, the study examines the literature on the three models, namely: neoclassical, conscious capitalism and entity maximisation and sustainability in order to identify themes or major identifiers of each model. Second, it analyses the financial statements (over five years from 2010 to 2014) of JSE listed companies in the food and drug retail sector, in particular the non-financial information. The entire population was analysed as there were only four in the population, namely SPAR, Pick n Pay, Shoprite and Clicks. Annual integrated reports and sustainability reports (where separately published) were analysed using content analyses. Keywords and themes were used to link the attributes of the company to the attributes identified in the literature to determine the model the company used. ...
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Several world institutions and researchers use import cif/fob ratios to measure a country’s international transport costs. The purpose of this paper is to investigate the (mis)measurement of transport costs in econometric modelling. The... more
Several world institutions and researchers use import cif/fob ratios to measure a country’s international transport costs. The purpose of this paper is to investigate the (mis)measurement of transport costs in econometric modelling. The paper discusses the econometric assumptions that are used to justify the (mis)use of country cif/fob ratios to measure international transport costs. Several econometric studies use a country’s cif/fob ratios as exogenous explanatory variables, whereas this study shows that the ratio may indeed be an endogenous variable, hence generating spurious empirical results. In this paper, the relationship between annual cif/fob ratios and compositions of imports are examined via correlation analysis. The findings show that where the quality of the data is reliable, a country’s composition of imports has a significant effect on that country’s cif/fob ratios; hence researchers cannot use the ratio as a dependable measure of direct shipping costs. Researchers sh...
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South Africa has a distinct system of port governance and regulated port infrastructure pricing. This article makes a contribution as it constructively critiques the Revenue Required methodology used by Transnet National Ports Authority... more
South Africa has a distinct system of port governance and regulated port infrastructure pricing. This article makes a contribution as it constructively critiques the Revenue Required methodology used by Transnet National Ports Authority (TNPA) for the 2014/15 tariff application. It challenges the underlying assumptions of the Revenue Required methodology as it is applied to the South African ports system and recalculates the tariff adjustment. There is a concern that the Required Revenue model may incentivise port prices at levels that are not in the best interests of the country. The findings show that TNPA’s application of the model contained rounding-off errors and the model is based on disputed assumptions. Specifically, TNPA does not include a debt beta, they use a Market Risk Premium (MRP) of 7.1% and use an asset beta of 0.5. This article recommends that the Ports Regulator of South Africa should: Include the calculation of a debt beta; allow an MRP of 6.3% or less; and use a...
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Background: With about 80% of world trade being seaborne, seaports’ capacity, efficiency and associated services are vital to ensure seamless, sustainable global supply chains. A lack of investment in marine services capacity and... more
Background: With about 80% of world trade being seaborne, seaports’ capacity, efficiency and associated services are vital to ensure seamless, sustainable global supply chains. A lack of investment in marine services capacity and performance in South African ports remains a concern for port users and supply chain practitioners.Objectives: This study examines the capacity and performance of marine services in South Africa’s ports. The primary example examines marine services performance data for the Port of Durban.Method: This study uses Transnet National Ports Authority (TNPA) data and descriptive statistics to analyse marine fleet performance, bollard pulls and human capacity in South Africa’s ports to identify causes of shipping delays in the Port of Durban from 2014 to 2021.Results: The 8 years analysis show five most prominent sources of shipping delays in Ports as; tugboats occupied, shift changes, shipping movements, tugs out of commission and adverse weather conditions. Other...
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Orientation: The Ports Regulator of South Africa (PRSA) allows South Africa’s National Ports Authority (NPA) to use a rate of return pricing methodology called the Required Revenue (RR) model to annually apply for tariff... more
Orientation: The Ports Regulator of South Africa (PRSA) allows South Africa’s National Ports Authority (NPA) to use a rate of return pricing methodology called the Required Revenue (RR) model to annually apply for tariff increases.Research Purpose: This article compares the pass-through of corporate tax rate approach to the use of an equitable tax rate in the RR model from 2011 to 2017.Motivation for the study: From 2011 to 2017, the PRSA allowed the use of the pass-through of corporate tax rate (28%) approach in the RR model. However, from 2018 it applied an equitable tax rate approach. It can be argued that the equitable tax rate approach should have been used from 2011.Research design, approach and method: The calculation of the equitable tax rate uses Transnet’s annual segmental financial statements. The results are compared with the revenue results from the pass-through of the corporate tax rate approach.Main findings: Applying the equitable tax rate (15.73%) as opposed to a pa...
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Background: The coronavirus disease 2019 (COVID-19) pandemic directly affected the shipping industry globally, and South Africa experienced decreased cargo volumes and increased freight rates. In addition, National Ports Authority (NPA)... more
Background: The coronavirus disease 2019 (COVID-19) pandemic directly affected the shipping industry globally, and South Africa experienced decreased cargo volumes and increased freight rates. In addition, National Ports Authority (NPA) charges are 69% and cargo dues 166% above the global benchmark mean. The NPA uses a rate of return (RR) model to calculate tariff increases that are contested by port stakeholders.Objectives: The study aimed to analyse the impact of COVID-19 trade disruptions and examine the associated higher liner freight rates, tariff applications for higher NPA tariffs and reduced investment in port infrastructure. It showed that adjusting the RR model variables can result in reduced tariffs and large cost savings for port users.Method: This study analysed the impact of the pandemic on South Africa’s cargo volumes and freight rates. It critiqued the regulatory asset base, the asset beta, and the tax rate to be applied and calculated the adjustments to these RR mod...
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South Africa is a major sea trading nation with a relatively open economy that accounts for approximately six per cent of real world seatrade. This performance places South Africa within the top 12 international maritime trading nations.... more
South Africa is a major sea trading nation with a relatively open economy that accounts for approximately six per cent of real world seatrade. This performance places South Africa within the top 12 international maritime trading nations. The literature reviewed clearly shows the importance of maritime transport costs and their ability to significantly impede international trade. South Africa’s atypical increasing transport cost rate on imports is identified, along with some of the potential determinants. South African shipping policy is shown to be one of the most liberal maritime policy regimes in the world. Regulatory intervention is all but absent, although maritime fiscal policy is less favourable as the international policy environment has evolved to a point where South African shipowners and operators now compete internationally on an inequitable fiscal basis. South African ports policy is investigated with the focus on the changing tariff environment. In addition, some of the...
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This study uses content analyses to examine 137 stakeholders’ submissions to the Ports Regulator of South Africa from 2009/2010 to 2018/2019, classifying themes into two broad categories, namely port authority pricing and port governance,... more
This study uses content analyses to examine 137 stakeholders’ submissions to the Ports Regulator of South Africa from 2009/2010 to 2018/2019, classifying themes into two broad categories, namely port authority pricing and port governance, which together define South Africa’s port doctrine. Results show that South Africa’s system of eight commercial seaports is unique and is financed and managed using a mix of elements from the Anglo-Saxon and Asian doctrines and attempts to charge port tariffs according to the Anglo-Saxon doctrine. The paper critiques the port authority pricing methodology employed in South Africa and shows its inconsistency with sound pricing principles and global best practices. The governance structure and how it has persistently defied legislation, which served to promote anticompetitive behaviour and at worst accommodated years of corrupt activities that have recently surfaced, are also discussed. The recommendation is a swift incorporation of Transnet National...
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The South African forestry industry contributes to the economic growth of the country by the planting of trees and the processing of these trees for the export market. The purpose of this study is to examine the trends in wood chip... more
The South African forestry industry contributes to the economic growth of the country by the planting of trees and the processing of these trees for the export market. The purpose of this study is to examine the trends in wood chip exports from the Port of Durban and to examine the stability and growth of private pulpwood production in Southern KwaZulu-Natal. The methodology used in this study includes questionnaires distributed to timber farmers and semi-structured interviews with respondents in forestry. The findings show that wood chip exports from Durban have increased between 2006 and 2011. Dominant challenges faced by the farmers were land reform, transportation costs and municipal rates. Land claims, road infrastructure, cash flow and variation in the demand for timber were the most challenging factors affecting private timber production.
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Local economic development (LED) is a process encompassing mobilisation of resources for competitive advantage by locally-owned or managed courses of action, identified through participation and social dialogue, in a strategically defined... more
Local economic development (LED) is a process encompassing mobilisation of resources for competitive advantage by locally-owned or managed courses of action, identified through participation and social dialogue, in a strategically defined territory. LED based on sound business principles can contribute to economic growth, job creation and poverty alleviation. The South African Constitution mandates LED to municipalities. Agriculture remains one of the most labour-intensive goods-production sectors with substantial employment linkages. The study centres on whether agriculture can provide an effective strategy for LED in uMshwathi Local Municipality, District Municipality of uMgungundlovu, KwaZulu-Natal, using the research method of the case study and secondary data. LED theories applied embody the principle of value-adding risk management. Locational development-inducing factors and high potential agricultural land for smallholder and organic farming provide comparative and competiti...
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More than 95 per cent of South Africa’s trade volume is seaborne. Although South Africa is clearly an important sea-trading nation, it is not a significant shipowning or ship operating nation. Despite a decade of democracy, and the... more
More than 95 per cent of South Africa’s trade volume is seaborne. Although South Africa is clearly an important sea-trading nation, it is not a significant shipowning or ship operating nation. Despite a decade of democracy, and the improved Ship Registration Act of 1998, the South African merchant marine has continued to decline. South Africa’s new Maritime Charter of December 2003 has the long-term vision “to develop South Africa to become one of the world’s top 35 maritime nations by the year 2014”. Currently, South Africa adopts a strongly market-driven shipping policy. In stark contrast the Charter calls for “a clear strategy/plan for the majority of South African cargo, going through South African ports to be carried on South African ships”. This article argues that although South Africa has a large volume of trade, it does not necessarily have a competitive advantage in the shipment of these goods. Thus policies to promote or protect the national shipping industry might not be...
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The purpose of this study was to critically evaluate the Umbumbulu Agri-Hub in eThekwini, KwaZulu-Natal as a successful model for supporting rural small-scale farmers. The Umbumbulu Agri-Hub, a Rural Agricultural Services and Marketing... more
The purpose of this study was to critically evaluate the Umbumbulu Agri-Hub in eThekwini, KwaZulu-Natal as a successful model for supporting rural small-scale farmers. The Umbumbulu Agri-Hub, a Rural Agricultural Services and Marketing Hub, was implemented by the eThekwini Municipality on a pilot basis, for three years, with the intention of rolling it out to other parts of the municipality. Data were collected from 49 farmers, from five selected representatives from the hub, from the eThekwini and iLembe Municipalities and from the KwaZulu-Natal Department of Agriculture. The findings show extensive support for the agricultural extension services offered by the hub, and that the hub has had a positive impact on the farmers as a conduit through which extension services can be provided to small-scale farmers in the rural area of Umbumbulu.
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Several world institutions and researchers use import cif/fob ratios to measure a country's international transport costs. In this paper, the relationship between annual cif/fob ratios and compositions of imports are examined via... more
Several world institutions and researchers use import cif/fob ratios to measure a country's international transport costs. In this paper, the relationship between annual cif/fob ratios and compositions of imports are examined via correlation analysis. The findings show that where the quality of the data is reliable, a country's composition of imports has a significant effect on that country's cif/fob ratios; hence researchers cannot use the ratio as a reliable measure of direct shipping costs. Researchers should be wary of substituting country cif/fob ratios for direct measures of transport costs. Copyright (c) 2009 The Author. Journal compilation (c) 2009 Economic Society of South Africa.
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This study assesses trends and stakeholder comments on maritime port pricing and governance in South Africa. Content analysis is used to analyse Transnet National Ports Authority (TNPA) tariff applications, Ports Regulator records of... more
This study assesses trends and stakeholder comments on maritime port pricing and governance in South Africa. Content analysis is used to analyse Transnet National Ports Authority (TNPA) tariff applications, Ports Regulator records of decision and stakeholder comments for 2010 to 2012. The study gathers data on port pricing from 1999-2012 and uses descriptive statistics to analyse the trends in port pricing. The findings show the distinctiveness of South Africa’s complementary system of ports and its uniform pricing policy. The ports are financed and managed using a mix of elements from the European and Asian port doctrines, whereas the pricing methodology appears to follow the Anglo-Saxon doctrine. A port doctrine should be developed that would be consistent with the country’s vision and policies.