South African Government approves major R94.8bn lifeline for transnet

In a decisive move to stabilise the financial standing of its critical freight and logistics utility, the South African government has approved an additional R94.8 billion in guarantees for Transnet. The approval, made on 25 July 2025, comes amid mounting debt pressures and credit downgrades affecting the state-owned company.

Of the total amount, R48.6 billion is earmarked specifically to ensure that Transnet can meet its debt redemptions over the next five years while maintaining adequate liquidity levels to support operations. A further R46.2 billion has been allocated to mitigate the financial risks stemming from recent credit rating downgrades, which have exacerbated borrowing conditions for the utility.

This guarantee package follows an earlier allocation of R51 billion in May 2025, which included R41 billion for Transnet’s funding needs for the fiscal years 2025/26 to 2026/27, and R10 billion dedicated to liquidity management.

The support was anticipated after Minister of Transport Barbara Creecy announced on 12 June 2025 that the government was initiating a process to allocate additional guarantees to Transnet. The move underscores a continued commitment to reviving South Africa’s logistics sector, which has suffered from ageing infrastructure, inefficiencies, and financial strain.

The government emphasized that this financial backing is not a blank cheque, but part of a broader effort to drive operational and financial reforms within Transnet. A key aspect of this initiative is the acceleration of private sector participation and the restructuring of logistics operations to enhance national and regional trade performance.

By stepping in with this financial cushion, the state aims to bolster Transnet’s role in economic recovery and ensure the sustainability of freight movement across rail, ports, and pipelines.