Corruption and permit costs challenge operators

Corruption remains one
of the biggest challenges
on the route from
Johannesburg to Lusaka, the
capital city of Zambia, says
Duene Reddy, the head of
operations for Reddy Logistics.
“Even when everything is
done legitimately, there is
nothing you can say or do, it
is almost like being held to
ransom unless you give someone
something,” he says.
Having your truck on the
ramp at a weighbridge is another
sure way to add to the cost of
a single journey into Lusaka.
“Officials at the weighbridge
don’t use a computerised system,
they simply come over to your
vehicle, tell you your vehicle is
overweight and you have to give
R100 in order to pass,” he adds.
“Everything is about paying to
get the delivery to its destination.
As transporters, we have been
forced to cut profits in half,” he
says.
Reddy, who is based in
Luanda, says another problem
relates to the use of vehicles
registered to the company
in South Africa. “There are
insurance and permit costs
galore. So we decided to register
our vehicles in Zambia and
this has made business easier,”
he says.
However, overcoming
one hurdle often means
preparing for the next one,
says Reddy. He says they use
two routes to Lusaka, either
via Botswana or via Beitbridge
border in Zimbabwe.
“Botswana is faster but often
when we get onto the other side
at the pontoon, we find one of
the ferries near Vic Falls always
broken, so time saved is lost
because we have to wait for the
ferry to be repaired or drive,
which takes time.
“On the other hand, we
experience diesel shortages
when trucks have to refill in
Zimbabwe, so we have many
challenges but seem to have
found a way to overcome the
odds,” he adds.
The pressure, though, shows
no signs of abating. “Just two
months ago we were paying
R380 for a month Cross Border
Road Transport Agency permit,
which now costs R2 660. If you
do the maths for the 20 trucks
we operate cross border, you
will see our costs have soared,”
he says.
And Reddy says it is hard
to pass on increased costs to
customers. “They look elsewhere
for business. The Cross Border
Agency fees have made business
that much more difficult, we are
in competition with operators
in other countries, they have
different cost factors to ours,
and can beat us in terms of price,
and so it is a huge challenge.”
Reddy says in addition one
needs a permit to Zimbabwe,
costing R 1400, and more
permits getting into Chilli
Labombwe near Lusaka. The
entire trip via border posts totals
around R6 000 a truck.
“It is a tough industry,”
he says.