Freight forwarders moving consolidated cargo through Madagascar could benefit from improved inland transfer since SACO opened an office in Antananarivo on September 1.
The neutral non-vessel-operating common carrier (NVOCC) plans to offer cargo de-grouping facilities in the capital where much of the country’s commercial activity is concentrated.
The service intends to address some of the cost, security and transit time challenges associated with moving cargo approximately 350 kilometres inland from the Port of Toamasina.
Inland cargo challenges
Moving cargo between Toamasina, also known as Tamatave, and Antananarivo is one of Madagascar’s main freight challenges, according to SACO Shipping Indian Ocean Islands Managing Director Percy Lamy.
“Most businesses want their cargo delivered to Antananarivo but moving it inland involves additional costs, security risks and other logistical challenges,” Lamy said.
The planned service will allow consolidated cargo to be de-grouped with customs clearance facilitation in Antananarivo rather than at the port container freight station.
“This will allow Malagasy traders to clear and receive their cargo more quickly in the capital,” Lamy said.
The Madagascar operation will be managed from Mauritius and will report to Lamy whose role is being expanded to Managing Director responsible for the Indian Ocean islands.
The operation will be subject to the same controls, regulations and audit processes as the company’s Mauritius business, SACO Group CEO Dave Graham said.
For South African clients, it will also be locally managed through the Africa Gateway in South Africa, which manages freight operations and communication across the continent.
The company established Consolidated African Freight Services in Mauritius in July 2011. The operation has since been rebranded as SACO Shipping Mauritius and has handled air and sea cargo moving to and from Madagascarand other Indian Ocean islands.
“Although we are only opening an office in Madagascar now, we have been doing business with the country for many years,” Graham said.
The new office will serve freight forwarders in line with SACO’s neutral NVOCC model.
Regional cargo links
Port Louis will continue to support cargo flows to Madagascar through SACO’s existing trade lanes linking Mauritius with South Africa, Europe, the Middle East and Asia, Lamy said.
“Port Louis is well positioned as an Indian Ocean hub and is served by several carriers,” he pointed out.
“We have active trade lanes from Hamburg, Antwerp, Singapore, Dubai, India and South Africa. Cargo can be moved to Port Louis for consolidation and onward shipment to Madagascar.”
Direct services between Madagascar and international markets will also be used where appropriate, Lamy added.
The expansion comes as work continues on a major upgrade of the Port of Toamasina, Madagascar’s principal maritime gateway.
The project includes a quay extension and container yard capacity, additional breakwater and infrastructure intended to enable the port to accommodate larger vessels.
“The port expansion makes this an opportune time to pursue further trade and logistics development in Madagascar,” Lamy said.
Madagascar has a significant textile manufacturing sector and trades with markets in Southern Africa, Europe, Asia and the United States.
The new operation will give freight forwarders access to the market through the same network and management structure used by SACO in Mauritius, Graham said.
“Madagascar is a complex market and freight forwarders may be cautious about entering markets where they do not have established partners,” he pointed out.
“The office will give them access to an established operator working under the same controls as the rest of our network.”
Madagascar will be SACO’s first fully branded operation in the Indian Ocean islands outside Mauritius. In addition to the 14 countries in Africa where SACO offices are currently located, the company is expanding further in West Africa and considering future expansion into other Indian Ocean island markets.
