A focus on mega-projects could blind logistics companies to other project cargo opportunities, says Duncan Bonnett, director of market access and research at Africa House. “Companies can be blindsided by projects such as the $50-billion Rovuma Basin oil and gas roll-out in Mozambique. But there is a lot more happening in the region,” he says. “We are seeing a definite uptick in project activity, particularly projects to install renewable energy.” Research by FTW has identified a number of opportunities in this area. In January this year the African Development Bank announced that it would be investing up to US$25 million in the ARCH Africa Renewable Power Fund (ARPF), a US$250-million private equity fund for renewable energy projects across sub-Saharan Africa. ARPF will provide equity for the development and construction of 10-15 greenfield renewable energy projects in sub-Saharan Africa, adding approximately 533MW of installed energy generation capacity from renewable sources in the region. As they roll out, these and other investments in renewable energy will create demand along the whole project logistics supply chain, says Bonnett. There is expected to be a revival of mining and manufacturing as reliable power becomes more readily available. “There is a nice uptick in exploration and development in the mining sector. “A lot of it is still in the early stages, but companies need to start positioning themselves now for the increased demand for project cargo,” he says. Much of this is happening in West Africa, in countries such as Congo Brazzaville, Ghana, Cote de Ivoire, Cameroon and Liberia. “In Central Africa there is also talk about reviving a number of projects. “And, despite the problems in the Democratic Republic of Congo, people are still investing there.” Infrastructure development, in addition to mining, is driving demand for project cargo on the eastern seaboard. There is investment in railways, ports and airports, as well as plans for refineries and renewables projects in countries like Tanzania, Mozambique, Uganda and Ethiopia. Bonnett warns that South African companies are losing out because they are not positioning themselves soon enough. “Companies say that they are waiting for the financial investment decisions (FID). But there is no longer a neat divide between FID and project activity. A lot of it is happening simultaneously. “My advice is for management to go and see for themselves what is happening,” he says.
We are seeing a definite uptick in project activity, particularly projects to install renewable energy. – Duncan Bonnett
