‘Durban is not the only game in town’

Infrastructure investment
throughout southern Africa
has changed the landscape
for South African shippers
and logistics providers who
are increasingly being outmanoeuvred
in their own
backyard.
That was the message
that came through loud and
clear at a business breakfast
jointly hosted by FTW and
the Johannesburg Chamber
of Commerce and Industry
(JCCI) last week on southern
Africa’s corridors.
“It is telling that both
Duncan Bonnett, director
of strategy and business
development at Africa House,
and I have independently come
to the same conclusion that
South African companies are
increasingly being by-passed
on their own doorstep,” says
FTW Africa correspondent Ed
Richardson.
He has compiled the first
FTW Insight Southern African
Corridors – Opportunities and
Threats report, and outlined
to delegates the advances
being made on the Walvis Bay,
Lobito, Dar es Salaam, Nacala,
Beira and Maputo corridors.
“Companies wanting to
continue doing business in
the region, or to grow their
presence in the region, have
to stay up to date with what is
happening on the ground. We
see vast improvements and new
infrastructure
on every
annual visit to
Namibia and
Mozambique
for FTW.”
Because
of the pace
of change,
shippers
and cargo
owners are
often making
decisions on
what routes to
use based on
past experiences or outdated
information.
“Do not take advice from
anyone who has not been to a
port and investigated the route
in the last six months at most,”
he says.
According to Bonnett
the rate of investment in
infrastructure in the region has
been only marginally affected
by the crash of commodity
prices.
“It is predicted that
infrastructure spend in Sub-
Saharan Africa will grow
by 10% a year over the next
decade, exceeding US$180
billion by 2025,” he says.
The result of
this investment
is that there are
alternatives to
Durban, which
are closer to
the market and
increasingly
more
competitive.
This is
already
affecting South
African exports.
“SA exports
to Continental
SADC declined by 24% in
market share terms from 2010
to 2014, before recovering
slightly in 2015,” he says.
Both speakers agreed that
the two developments that
have the most potential to
disrupt the existing logistics
chains in southern Africa are
the building of a new container
terminal in Walvis Bay and
the opening up of a rail link
between the upgraded port
of Lobito in Angola and the
Copperbelt.
The development of the
oil and gas industry in
Mozambique is a significant
opportunity for South African
companies, says Bonnett, but
“increasingly a presence will be
needed in key markets."
The time to act is now, the
speakers warned.
“There is an increasing
number of Turkish, Moroccan,
Brazilian, Pakistani, Kenyan,
Nigerian, Egyptian and other
companies investing in and
exporting to Sub-Saharan
Africa in all sectors,” says
Bonnett.
“We see it in our annual
visits – the hotels and offices
are filled with bright young
people from traditional
African trading partners such
as Portugal, Italy, France
and the United Kingdom
who have moved to Africa in
search of opportunities that
are not offered at home,” says
Richardson.
The FTW Insight Southern
African Corridors report
outlines the investment in the
corridors, and the potential
impact the changing logistics
landscape will have on shippers,
cargo owners and the logistics
industry overall.
It is available from Anton
Marsh (antonm@nowmedia.
co.za).
INSERT
Do not take advice
from anyone who has
not been to a port
and investigated the
route in the last six
months at most.
– Ed Richardson
CAPTION
Ed Richardson, FTW's Africa correspondent.