MBABANE – Before the main phase of the Eswatini Rail Link (ESRL) project has even begun, government has already spent E270 million.
This amount is reflected in the current budget estimates as actual expenditure under the project titled ‘Preliminary Designs for the Lothair–Matsapha Railway Line.’
However, the figure has raised questions that Parliament has yet to address. Budget estimates from previous financial years show that spending on the same project had reached E373 million, suggesting a discrepancy of E103 million.
It remains unclear why the reported expenditure has now been reduced and no official response was provided to this publication’s inquiry on the matter. The total estimated cost of the Preliminary Designs for the Lothair–Matsapha Railway Line has also been revised downward from E1.551 billion to E580 million.
For the new financial year, which began on Wednesday, April 1, 2026, government has allocated E26.25 million to the project.
The funds will be drawn from the Consolidated Fund to support the ongoing resettlement programme linked to the development.
ESRL is a joint initiative between Transnet Freight Rail (TFR) of South Africa and Eswatini Railways (ESR).
The ESRL project is often referred to as Swazilink.
It aims to construct a 150 km new rail link between Lothair in Mpumalanga, South Africa and Sidvokodvo in Eswatini.
The total estimated project is approximately E24 billion. The project is currently in the resettlement stage, with financing arrangements still being finalised and a Special Purpose Vehicle (SPV) being used to raise funds.
The project is designed to create a new, dedicated general freight business (GFB) corridor to increase freight logistics efficiency between South Africa and Eswatini.
Key aspects include new rail construction, a 150km railway line connecting Lothair (SA) and Sidvokodvo (Eswatini), with roughly 100km in Eswatini and 50km in South Africa. The project includes upgrading existing infrastructure, specifically the lines from Ermelo to Lothair and Sidvokodvo to the Port of Richards Bay. The goal is to move general freight away from South Africa’s main coal line, increasing capacity by 15 million metric tonnes annually to the Richards Bay Coal Terminal. The new link is expected to handle 2.5km-long trains with up to 200 wagons, supporting an axle load of 26 tonnes.
What remains a major concern, however, is that the project continues to move forward despite reports that Transnet is currently underperforming. It must be said that the South African company made a smaller loss in the last financial year, saying its turnaround programme is starting to deliver results.
However, the company’s auditor repeated concerns about Transnet’s viability.
It reported a loss of E1.9 billion in the 12 months to the end of March, down from E7.3 billion the year before.
In 2024, the South African Government announced that it would inject E47 billion into Transnet.
The aid was to take the form of a guarantee mechanism to help the State-owned enterprise meet impending debt repayments. This was said by the National Treasury.
It must be said that Transnet has experienced significant operational, financial and governance challenges in recent times.
Former Transnet Chief Executive Officer Brian Molefe and Siyabonga Gama, along with ex-Chief Financial Officer Anoj Singh and ex-Chief Procurement Officer Thamsanqa Jiyane, were arrested on June 30, 2025, for fraud, corruption and money laundering related to a E93 million locomotive procurement scandal.
They were granted bail and face charges tied to the ‘State capture’ era. They are innocent until they are proven guilty.
According to the Business Report, a South African publication, Transnet, a partner of ESR in the joint project, is now burdened with debt amounting to approximately E144 billion, up from E137.6 billion previously. Interest payments alone total about E15 billion per annum, compared to E14 billion in the prior year.
Deputy Business Unit Leader in the Office of the Auditor General, Bongumusa Thabethe, stated that the figures translate to roughly E1.2 billion per month in debt servicing costs, even before accounting for day-to-day operations or infrastructure maintenance.
With annual revenue standing at around E86 billion, it must be said that a substantial portion of Transnet’s income is consumed by debt obligations.
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The Eswatini Rail Link (ESRL) is a joint initiative between Transnet Freight Rail (TFR) of South Africa and Eswatini Railways (ESR). (Courtesy Pic)