12:27 GMT 15th June 2011
But according to the UN Conference on Trade and Development (Unctad), both importers and exporters face high costs for sea transport and substantial inefficiencies in port clearance operations. U nctad says that the average freight rate for imports is 47 per cent higher than in other developing countries and twice the rate in developed countries, estimated at 5.21 per cent.
For containerised imports, cargo dwell time - defined as the time between vessel arrival and container exit from the port facilities - exceeds 20 days on average for most continental ports, making them the most inefficient ports in the world. 'This is an added burden on business as compared to other regions in the world, as businesses relying on just-in-time shipment are less likely to develop in such an environment, and local importers need to integrate higher storage and inventory costs,' noted a recent document by the Economic Commission for Africa (ECA).
In this regard, various international trade bodies have said that if Africa wants to increase its current 2.7 per cent share of world trade it will have to invest heavily in their ports and harbours. For years, African countries had neglected to upgrade port facilities and as a result they have not been able to keep up with the pace of new technology that has been introduced elsewhere.
It has been estimated that it costs as much to clear goods from Dakar port as it does to ship the same volume of goods from New York to Dakar. The UN estimates that the cost of shipping, clearing and transporting goods in Africa is double the global average. Its review of the African port sector showed that transport costs accounted for 12.65 per cent of the cost of imported goods in Africa, more than double the global average, while for Africa's many land locked states the figure jumps to 20.69 per cent.
Figures from the World Bank are even higher. They show that although it costs between $1,000 and $1,200 to ship a container from Baltimore in the US to either Durban or Dar es Salaam, it costs a further $10,000 to $12,000 to transport a container from Dar es Salaam to Bujumbura in Burundi or from Durban to Mbabane in Swaziland.
Africa's ports are not only serving coastal nations but landlocked ones too. Landlocked countries such as the Democratic Republic of Congo (DRC) and Zambia, which need to ship huge quantities of mineral resources to overseas markets, can ill-afford to put up with port delays. In March, Tanzania's parliamentary finance and economic affairs committee was told by Fulgence Bube of the country's truck owners' association that Dar es Salaam port was losing business as a result of delays in clearing cargo destined for the DRC and Zambia. 'Some importers in DRC and Zambia have reportedly turned their backs [on] Dar es Salaam port in favour of Namibia's Walvis Bay,' he said.
Bube said dwell time at the Dar es Salaam port was between two and four weeks and between six and nine days at Mombasa in Kenya, but only three days at Walvis. 'At such a level of inefficiency, some importers in Lusaka and Lubumbashi [in DRC] have opted to route their cargo via the Walvis Bay Port. Walvis Bay is 3,500kms from Lubumbashi, a distance that is 1,500kms longer compared to Dar es Salaam, but truck drivers spend hardly a week before delivering consignments to importers,' Bube explained.
It is the same story for most African ports. According to a report by Ocean Shipping Consultants, ports in Africa, apart from South Africa, have not kept pace with the performance of those in other developing regions of the world such as Asia and Latin America. For example, in the growth area of container ports, none of the top 20 lead ing container ports is in Africa. The I ist is made up of 13 ports in Asia, four in Europe and three in the US.
Belatedly, African governments have come to realise the importance of improving port operations and road transport connections. Most of the world's major ports are close to main international shipping routes along the east-west axis. In the case of Africa, the main international shipping routes run along the Red Sea to the Suez Canal through the Mediterranean and out through the Straits of Gibraltar. The vessels that traverse these routes deliver goods mainly to and from Asia and Europe.
According to Unctad, global operators of ports and terminal companies have attempted to expand along the main shipping routes. 'However, for a variety of reasons, Somalia, Eritrea, Sudan, [Libya] and Tunisia are not currently host to these global port or terminal- operating companies,' Unctad said in a chapter on Africa in the Review o/Maritime Transport 2009.
'Among the reasons for this are local physical constraints like water depth, existing shore side facilities or infrastructure, as well as social, political, legal and economic constraints. This in tum has affected trade flows, as an increasing number of ships are now avoiding the Suez Canal and taking the longer route around the Cape of Good Hope,' it added.
The latter reference is in regard to the activities of pirates off the coast of Somalia and in the Gulf of Aden that have been hampering shipping and have led to an increase in shipping costs. Piracy has not only affected the maritime industry, it is also a cause of concern for the International Maritime Organisation (IMO) and the UN.
Nevertheless, trade volumes are on the up as the world's fleet of consumer ships continues to increase. In the last decade, shipping lines have invested in ever growing container ships in order to benefit from economies of scale.
This trend of larger ships will increase the demand for better and adequate port facilities and for significant improvement in port productivity in Africa.
The Review of Maritime Transport acknowledged that most African ports could handle containers but their cargo-handling operations would remain less efficient if special container cranes were not used. The report noted, 'In some African ports, for instance, container moves of25 per hour are common, whereas in more developed ports the rate can be double or triple.'
One port development that has taken place in Nigeria is the landlord system, whereby the public sector takes responsibility for port planning, while the private sector is responsible for marine and terminal operations or the development of port infrastructure and equipment. Unctad says that the advantages of such arrangements include improvements in port efficiency, reductions in berthing time and an increase in overall productivity.
In Ghana, port authorities have installed ship-to-shore gantry cranes, rubber-tyre gantry cranes, constructed a container terminal and an off-dock container devanning area - that is, a section dedicated to unloading containers. The Ghana Shippers' Council has introduced a destination inspection scheme, scanners to examine containers and a satellite tracking system to monitor transit of goods. In addition, the ports have had cameras installed to improve security and reduce theft.
In all this, what is important is the volume of trade that African ports have to handle. South Africa is the largest market in volume terms for containerised cargo, with Durban, the largest port in the region, achieving grow1h rates. The other major ports in the country, Cape Town and Port Elizabeth, recorded marginal grow1h rates.
Other Southern African countries have also improved port facilities and, in tum, their connections with landlocked countries. For instance, Mauritius is providing trans-shipment services while Namibia, which has greatly improved its port at Walvis Bay, is attracting cargo from Botswana and Zambia.
In West Africa, ports in Cameroon, Cote d'Ivoire, Ghana, Nigeria and Senegal have also seen increased cargo-handling in the last few years, according to Unctad, with ports in oil-exporting countries such as Angola, Cameroon and Nigeria reporting the highest growth rates.
According to the ECA, one area with a good track record in Africa is that of port state control (PSC). It is related to the inspection offoreign ships in national ports in order to verify that the condition of the ship and its equipment comply with the requirements of international conventions and that the ship is manned and operated in compliance with applicable international laws. The primary responsibility for ensuring that a ship maintains a standard at least equivalent to that specified in international conventions rests with the state under whose flag the vessel is flying.
'If all flag states performed their duties satisfactorily there would be no need for port state control,' said Heike Hoppe, technical officer in the IMO's Maritime Safety Division. 'Unfortunately this is not the case as evidenced by the many marine accidents around the world - hence the need for additional control.'
The regime introduced by the Paris Memorandum of Understanding (MOU) on PSC adopted in 1982 became the first regional system in the world dealing with the matter. The Paris MOU is an intemational agreement involving 18 countries to establish a co-ordinated PSC system with respect to vessel safety and pollution prevention standards and equipment. One goal is for member states to inspect at least 25 per cent offoreign merchant ships entering their respective ports each year.
If deficiencies that are clearly hazardous to safety, health or environment are discovered the ship will be detained and repairs will need to be completed before the ship can leave the polio The IMO has developed a global strategy for PSC and has incorporated procedures for overseeing professional profile, training and qualification requirements and general operating guidelines for control officers. This is to ensure that, while the systems may be regional, the standards applied will be universal.
Regional PSC bodies have been established through MOUs, which cover all of the world's oceans. The Abuja MOU covers countries in West and Central Africa while those in the Indian Ocean have the Indian Ocean MOU.
Crucially, with regard to PSC, all possible efforts should be made to avoid a ship being unduly detained or delayed. If this is found to have occurred, it should be entitied to compensation for any loss or damage suffered. Thus, it is necessary for ports in Africa to have the necessary manpower and equipment to carry out a fast turnaround of checks on vessels.
In the final analysis, the need for port managements' agement reform in Africa to improve trade competitiveness and reduce the financial burden on national budgets is crucial. According to the ECA, the private sector offers great opportunities in terms of responsiveness and adaptation to the demand from the shipping companies and allows the transfer of technical know-how for more efficient terminal management. 'It is also fair to note that positive changes are now being observed in Africa. The growing trend of privatisation of port services in Africa will improve efficiency,' the ECA stated.
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