SANRAL credit rating nailed by e-tolls

The South African National Roads Agency Soc Limited (SANRAL) has advised that Moody’s Investors Service has downgraded its long-term ratings due primarily to the e-tolling fiasco.

Moody’s stated that the rating action follows the recent decision of the South African government to further reduce the toll fees on SANRAL’s biggest toll road project, the Gauteng Freeway Improvement Project (GFIP).

The negative rating outlook reflected Moody’s concerns regarding South Africa’s deteriorating operating environment, as reflected by the negative outlook on South Africa’s A3 government bond ratings; and the concerns regarding SANRAL’s operational risks and business model, the ratings agency said.

SANRAL has been downgraded to Baa1 (global scale, local and foreign currency) and to Aa3.za (South African national scale rating), from A3 and Aa2.za, respectively.

The outlook on the ratings is negative, Moody’s said.

Cosatu secretary general, Zwelinzima Vavi, said on Thursday (1 March 2012) that Gauteng highways are national assets and not commodities for profit, Sapa reported.

“The federation will continue to campaign for an efficient, safe, and affordable system of public transport,” Vavi added.

Tolling was also expected on 185km of the N1, N3, N12 and R21 around Johannesburg and Tshwane.

With effect from April 30, motorcycles with e-tags will pay 20 cents a kilometre and those without, 38 cents.

Light motor vehicles will pay 30 cents and 58 cents with and without tags, respectively, and non-articulated trucks 75 cents and R1.45.

Articulated trucks with e-tags will pay R1.51 a kilometre and those without, R2.90.
Under the new fee system, the cost for motorcycles and light vehicles will be capped at R550 a month, Sapa wrote.

Vavi said Congress of SA Trade Union (Cosatu) affiliates and provincial structures reported overwhelming support for a March 7 strike against e-tolling – and for banning labour brokers.

“It’s all-systems go for the biggest mass protest in years,” he said.

Government spokesman, Jimmy Manyi, however, weighed-in on the reality of the e-tolling situation, saying that e-tolling is not going to go away.

“This is not just a bad dream; it’s a reality, it’s going to happen,” he said, “No one should have any illusion whatsoever that this thing is going to go away. It’s a fact of life and it’s going to happen.”