The performance of South Africa’s logistics industry has regressed significantly over the span of just one and a half years according to the latest data from the World Bank’s Logistics Performance Index (LPI).
In 2016, South Africa was ranked 20th out of 160 countries with regards to the “friendliness” of the local logistics sector. Since then it’s slipped to 33.
According to the index, the country’s logistics industry experienced significant decreases in five of the six sub-indices of the LPI. This includes the efficiency of customs clearance processes, quality of trade and transport-related infrastructure, quality of logistics services and competence, the ability to trace and track consignments as well as the frequency with which shipments arrive on time.
Improvement was only recorded in South Africa’s ability to arrange competitively priced shipments with ease. The LPI is based on a worldwide survey of operators on the ground (global freight forwarders and express carriers), providing feedback on the logistics “friendliness” of the countries in which they operate and those with which they trade.
Group CEO of World Net Logistics, Dirk Goedhart, told FTW that he believed this backward movement to be largely attributable to productivity issues at the country’s ports in 2017 – particularly the “challenges” experienced at the Port of Durban.
“Congestion at the Durban port began some time before the infamous October 10 storm last year, which only served to exacerbate the situation making it extremely frustrating for importers and exporters alike," he said.
He noted that other obstacles recently faced by the domestic logistics industry included the increase in stops by the various authorities with lengthy resolutions.
The resultant costs in unnecessary storage and demurrage impacted on margins. Red tape faced in acquiring Letters of Authority from the National Regulator for Compulsor Specifications also has disrupted the flow in supply chains with importers having to wait for longer than three months.
