JOHANNESBURG - South African state logistics group Transnet signed a ‍25-year ‍deal with Philippines-headquartered terminal operator ICTSI on Wednesday ​to upgrade the African country's busiest container terminal ⁠in Durban.

The concession agreement is part of the ⁠government's plans to ‌address Transnet's chronic underperformance, which has stifled exports from Africa's biggest economy.

Transnet ⁠said in a statement that the upgrade and development of Durban Container Terminal Pier 2, which handles more than 40% ⁠of South Africa's container ​volumes, would start from January next year, when ICTSI will ‍take over operations.

Pier 2's capacity and efficiency are ​expected to increase through the introduction of new equipment and technology.

Transnet Chief Executive Michelle Phillips said working with private companies was an important part of the state-owned company's strategy to modernise and improve its performance.

Transnet will hold a majority shareholding in a new special purpose ⁠vehicle set up for ‌the ICTSI partnership, which was delayed by a long-running legal dispute over Transnet's decision to ‌choose ⁠ICTSI as a partner.