A new report offers six recommendations to accelerate the modernisation of Africa’s port sector.
‘Africa’s ports: fast-tracking transformation’, produced by the Africa CEO Forum, in partnership with Africa-focused strategy consulting and financial advisory firm Okan, suggests measures including improved public investment structure, eradicating operational inefficiencies, mobilising private investment through public-private partnerships, and fast-tracking integrated industrial port projects.
The COVID-19 pandemic has led to significant upheaval in the transport and logistics sectors. One of the most major impacts is the decline in trade flows, taking the form of a 30% to 40% decrease in traffic for certain African ports, said the Africa CEO Forum.
This follows two decades of unprecedented growth in investment and competitiveness in the continent’s port sector. Totalling $1.2bn between 1990 and 2004, private investment in Africa’s port sector grew by a factor of 13, reaching $15.2bn between 2005 and the first half of 2019.
Despite the emergence of African ports able to accommodate next-generation vessels, the Africa CEO Forum said out of Africa’s top 20 ports, only Egypt, Morocco and South Africa had a cargo handling capacity of more than 4 million TEU in 2018.
Potential actions
The report discusses investing “wisely to end the vicious cycle of operational inefficiencies”. It suggests investing in modernising existing infrastructure and the use of new technologies, such as the Port Call Optimisation application, and task automation to streamline operations.
“Ambitious governance reform” is needed to attract public-private partnerships for financing. The report said this could be establishing clear roadmaps, explicitly defining the role of stakeholders and, above all, setting up stable, transparent legal frameworks.
“Streamlining port-city interactions and improving connectivity with hinterlands are essential to boosting port sector competitiveness,” said the report. The rapid urbanisation of Africa’s cities has resulted in congestion around various ports. One of the solutions the report proposes is to develop multimodal logistics corridors, as they would better connect ports to inland areas while also reducing operating costs.
The report also recommends “modernising the non-container segment to ensure the continent’s full development”. Exploring other solutions such as bulk, roll-on/roll-off and grain terminals would help diversify trade and turn economies in the direction of a more resilient and less dependent model.
