Negligible local growth and weak global demand has seen the bulk cargo sector remain sluggish. According to Pooven Moodaliar, managing director of Cargo Lash, low commodity prices and the high degree of uncertainty in economic relations between countries has not helped the situation much.
Also, while tensions in many parts of the world are rising, South Africa has also been under pressure with a downgrade in its rating and ongoing political instability.
“Africa, however, remains a growth sector despite the dull economic outlook, especially when one looks at bulk,” said Moodaliar. “As the Chinese economy slows, its ambition for growth must be met outside its home market. Consequently, we expect China’s demand for project and breakbulk cargo to grow significantly over the next few years, and there will be an increasing need for project logistics services in China from around the world.”
Such cargo required in-depth logistical experience and tailored equipment to ensure safe and secure transportation and damage-free goods during transit, said Moodaliar. Any delay in shipment or cargo damage could result in a significant increase to the total cost as well as disruption to the global business. Moodaliar said considering the expected demand for bulk commodities, it was essential that South Africa work on improving its efficiency.
“South Africa’s ports outshine the rest of sub-Saharan Africa’s and Durban is ranked 25th in the world in terms of attractiveness.
“However, it’s disappointing that we do not achieve the efficiency expected from a major global hub port,” he said. “A number of factors, including weaker commodity and oil prices as well as the drought, have had a major impact on the increase in the bulk cargo sector. Improvement in port performance and efficiency could increase this. A decrease in port charges and tariffs would make it more attractive to do business here.”
In the meantime cost remained a major stumbling block, Moodaliar said.
“As an industry, we need to try and achieve more efficiency and higher turn-around times to align ourselves with other major ports, especially in terms of the prices we charge and the cost of doing business here. That will improve our competitiveness internationally.”
INSERT AND CAPTION
Africa remains a growth sector despite the dull economic outlook. – Pooven Moodaliar
