Part of Durban's harbour. Picture: BLOOMBERG/KEVIN SUTHERLAND
Part of Durban's harbour. Picture: BLOOMBERG/KEVIN SUTHERLAND

State transport operator Transnet expects job creation and tourism development to follow the construction of a R200m cruise-ship terminal facility in Durban by the KwaZulu Cruise Terminal (KCT) company, says Transnet CEO Siyabonga Gama.

KCT and Transnet National Ports Authority concluded an agreement on Monday for a 25-year concession project to finance, construct, operate, maintain and transfer the terminal. KCT is a joint venture between investment company Africa Armada Consortium and MSC Cruises SA, a subsidiary of MSC Mediterranean Shipping Company.

MSC Mediterranean Shipping Company is the world’s second-largest container shipping line operator. It is based in from Geneva, Switzerland.

KCT is 70% owned by MSC Cruises SA and 30% by Africa Armada Consortium. The venture is classified as an exempted micro enterprise (EME), which means it has been operating for less than a year and has a turnover of less than R10m. EMEs are exempted from broad-based black economic empowerment scorecard ratings.

The design phase begins in April, followed by an 18-month construction phase from January 2019 to July 2020. Operations are expected to begin with the start of the 2020-21 cruise season in October 2020.

About 100 people will be directly employed in the construction phase and another 10,000 indirect jobs will accrue through the multiplier effect, says KCT. The company has budgeted for R3m for the training and development of more than 100 people during the construction phase, while R1.5m will be allocated to bursaries and scholarships.

The ports authority’s CEO, Shulami Qalinge, said on Monday the new terminal would attract larger vessels and more leading cruise liners to SA. The cruise season period could be extended during the 25-year operational phase, resulting in economic spinoffs for the tourism industry.

Qalinge forecast a substantial increase in cruise vessel calls to Durban. Greater passenger numbers would help to develop the city further as an international tourist destination, he said.

Cruise calls were likely to rise from 60 to more than 150 a year, which should see passenger numbers grow from 200,000 to more than 700,000 by 2040.

During the off-peak season the terminal will remain active as a multipurpose facility, including a cruise and hospitality academy and office and conference space.