Mmegi Online :: BR, Spoornet sign business agreement
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Last Updated
Friday 24 June 2016, 18:01 pm.
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BR, Spoornet sign business agreement

Botswana Railways (BR) and Spoornet of South Africa have finalised bilateral business discussions by sealing an agreement at a colourful occasion in Kasane over the weekend. The agreement will result in a joint business and harmonisation of expectations in terms and allocation of resources.
By Staff Writer Mon 27 Jun 2016, 04:09 am (GMT +2)
Mmegi Online :: BR, Spoornet sign business agreement








The state owned BR went into discussions with Spoornet - Africa's biggest rail outfit - 18 months ago for a bi-lateral business agreement that would see Botswana benefiting from business from South Africa.
After a closed-door meeting in Gaborone last year, a joint task team comprising officials from the two organisations was set up to negotiate and agree on various issues. The issues included increasing tonnages on the BR corridor; resource sharing and improving transit container traffic; and general cargo.

BR's director marketing and supply, Taolo Sebonego noted after the signing ceremony that once put in place, the task team reviewed BR and Spoornet business agreements and identified areas of mutual benefit and opportunities for business growth.
"Key to this was the harmonisation of our operations across our two borders with particular focus on fair traffic routing. The meeting also included the participation of our key customers and strategic partners (industry partners) who are the consumers of our service offering and supporters respectively," Sebonego said.

Business prospects for the two organisations were discussed but Sebonego said that they would not be in a position to divulge the financial gains that would come with the deal. However he said the corporation is involved in a major international marketing exercise.

He explained that the marketing drive is meant to design and restore the Botswana route as the most optimal and cost effective linking the north and

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the southern countries within SADC. He said this means that BR needs to develop collaborative relationships with connecting railways in neighbouring countries and strategic business allies.
Sebonego indicated that BR sees Spoornet as a critical player in addressing issues related to the application of the shortest route principle. The principle contributed to the diversion of transit traffic from the Botswana route to the Beitbridge route. This resulted in a loss of over P1 million per annum for BR in the last five years.

Last year after BR chief executive officer Andrew Lunga and his Spoornet counterpart Siyabonga Gama revealed that it is important to advance the views of Botswana and South Africa despite the existing agreements in the region. He said that because of the geo politics, the two countries' fortunes are intertwined. BR aand Spoornet already have agreements and joint ventures like Gabcon.
Lunga revealed that the meetings between the two rail authorities discussed joint marketing ventures, movement of international traffic and Gabcon joint venture, which is said to be profitable.

The two organisations agreed that there is need to review two major corridors - Mafikeng to Botswana and Beitbridge into Zimbabwe - to determine the cost effective one.
It was agreed that because of the countries' geo political ties, it is important for the two railway companies to work at exploring current traffic in South Africa and Botswana.

 

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