Transport Sector Urged to Drive Inclusive Growth and Empower Marginalised Groups

South Africa’s Deputy Minister of Transport, Mkhuleko Hlengwa, has called on the transport and logistics industry to become a central driver of social and economic transformation, particularly through inclusive growth, black economic empowerment, and MSME development. His remarks were delivered during the Micro, Small and Medium Enterprise (MSME) Conference held in Gqeberha, where delegates from the cross-border transport industry gathered to discuss the sector’s future.

Hlengwa emphasized that although the transport and logistics sector is pivotal to South Africa’s economic engine, its ownership and operational landscape still reflects deep structural inequalities, with a concerning decline in black ownership levels in recent years.

“The transport sector is instrumental in the functioning of our society, yet it has excluded those from previously disadvantaged backgrounds, women and youth,” said Hlengwa.

B-BBEE Ownership Declines: A Wake-Up Call

The Deputy Minister pointed to alarming findings from the Broad-Based Black Economic Empowerment (B-BBEE) Commission, which reported that black ownership in the transport and logistics sector dropped from 48.6% in 2019 to just 38.8% in 2022.

This downward trend, he noted, signals the need for urgent reform, backed by government-private sector collaboration, to reverse regression and ensure the transport sector mirrors the demographics and potential of the nation.

MSME Development: The Engine for Inclusive Growth

The MSME Conference, hosted under the theme of inclusive sectoral growth, served as a platform to assess the needs of emerging entrepreneurs in logistics, freight, and passenger mobility services. Hlengwa affirmed the government's commitment to policy reforms and support mechanisms that would stimulate entrepreneurship and allow small businesses to thrive in the sector.

“In this context, the transformation and development of small businesses becomes a key component and contributor to government’s economic development agenda,” he said.

The Deputy Minister emphasized that logistics and transport have been identified as priority sectors in South Africa’s economic reconstruction and recovery strategy, given their multiplier effect across various industries—from manufacturing and retail to agriculture and cross-border trade.

Empowerment Through Charter and Incubation

In line with transformation efforts, the Department of Transport appointed the Integrated Transport Sector B-BBEE Charter Council in May 2023 to revise and implement Transport Sector Codes, modernize empowerment frameworks, and facilitate greater representation of designated groups—including women, youth, and persons with disabilities.

The Council has since worked closely with stakeholders to align empowerment policies with industry reforms, with the goal of creating a more inclusive and competitive transport economy.

Meanwhile, the Cross-Border Road Transport Agency (C-BRTA) has already demonstrated measurable success by exceeding its 5% target for increased participation of Previously Disadvantaged Individuals (PDIs) in the industry by 4.4%, driven by strategic empowerment initiatives.

The Incubation Programme: Building a Pathway to Participation

Looking ahead, the Department of Transport has thrown its support behind the C-BRTA’s Incubation Programme, which aims to create a coordinated, structured pipeline for empowering MSMEs and new entrants in the cross-border transport industry.

The programme is tailored to benefit:

• Existing cross-border freight operators

• Domestic freight operators aiming to expand across borders

• Established cross-border passenger service providers

• Start-ups and newcomers to the transport industry

By fostering structured mentorship, access to finance, compliance support, and business development services, the programme intends to sustain and scale participation of PDIs over the next five years.

“The aim is to create a structured Incubation Programme that will bring industry stakeholders together in supporting MSMEs,” Hlengwa explained.

He stressed that cross-border trade represents a significant growth opportunity for emerging transport entrepreneurs, especially as the African Continental Free Trade Area (AfCFTA) opens new regional corridors and value chains.

A Sector Ready for Redesign

The Deputy Minister’s remarks underscored the broader imperative of positioning the transport and logistics sector as a vehicle for social justice, not merely economic throughput. For South Africa to overcome unemployment and poverty, sectors like transport must embrace inclusivity, innovation, and sustainability.

Government's ongoing reform agenda seeks to:

• Simplify regulatory frameworks for new entrants

• Expand financial and technical support for MSMEs

• Promote local manufacturing and supply chain localisation

• Facilitate training in logistics and compliance

As the transport sector continues to evolve with technological innovations and green logistics, South Africa's challenge is to ensure that growth is not just measured in output but in empowerment.

“We are committed to a reform process that revitalises the sector while also transforming our society. The time for partnership and progress is now,” concluded Hlengwa.