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One-stop concept to the fore Cross-Border Focus FREIGHT & TRADING WEEKLY SPECIAL FEATURE FEBRUARY 2009

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Page 1: Cross-Border Focus - Now Mediacdn.nowmedia.co.za/NowMedia/ebrochures/FTW/Standard/FTW_Cross... · Cross-Border Focus FREIGHT & TRADING WEEKLY SPECIAL FEATuRE FEBRuARY 2009 ... Zim

One-stop concept to the foreCross-Border Focus

FREIGHT & TRADING WEEKLY

SPECIAL FEATuRE

FEBRuARY 2009

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FTW4137

Johannesburg + 27 11 625 3000

FTW4140

Shipping Services

Clearing and Forwarding

Warehousing

Logistics

Procurement

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Durban + 27 31 460 0700

Cape Town

Johannesburg

Durban

Beira

LilongweLusaka

Kapiri MposhiNdola

Blantyre

Dedza border post

HarareTete

GATEWAY INTO AND OUT OF AFRICA

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FEBRUARY 2009 | 1

Editor Joy OrlekConsulting Editor Alan PeatContributors Tersia Booyzen Liesl Venter Advertising Carmel Levinrad (Manager)

Yolande Langenhoven Claire Storey Jodi Haigh

Managing Editor David Marsh

CorrespondentsDurban Terry Hutson

Tel: (031) 466 1683Cape Town Ray Smuts

Tel: (021) 434 1636Port Elizabeth Ed Richardson

Tel: (041) 582 3750Swaziland James Hall

[email protected]

Advertising Co-ordinators Tracie Barnett, Paula SnellLayout & design Dirk VoorneveldCirculation [email protected] by JUKA Printing (Pty) Ltd

Annual subscriptions RSA – R425.00 (full price)

R340.00 (annual debit order) Foreign on application.

Publisher: NOW MEDIAPhone + 27 11 327 4062

Fax + 27 11 327 4094E-mail [email protected]

Web www.cargoinfo.co.za

Now Media Centre 32 Fricker Road, Illovo Boulevard,

Illovo, Johannesburg. PO Box 55251, Northlands,

2116, South Africa.

Cover concept: Dirk Voorneveld

FTW1399SD

Border delaysPage 2The cause of up to 40% of transport time

ChirunduPage 3One-stop set for April

Smuggling Page 3Transporters challenge impounding of trucks

MaputoPage 4One-stop border post the key to growth

Beitbridge Page 5 Infrastructure on the verge of collapse

Food aid Page 8Surge to Zim clogs Beitbridge

ZambiaPage 11Demand for containers to Zambia unprecedented

Axle weight Page 12Inconsistency adds challenge for hauliers

Swaziland Page 18Operator reluctance holds back extended border post hours

Streamlined border operations demand buy-in from all involved.While the merits of a one-stop border post concept are recognised, the challenges to achieving it are significant.FTW takes a closer look.

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2 | February 2009

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ftw4007

First For Freight into Africa JohannesburgTel: +27 11 918 6645

Fax: +27 11 918 6618

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MusinaTel: +27 15 534 2180

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MalawiTel: +265 1711 336

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Durban / JHB to Malawi & Zambia direct Exceptional Transit Time Consolidations / Part Loads / Full Loads Competitive Rates Airfreight to Malawi & Zambia Specialist Packaging & Crating Hazardous/ Abnormal Loads Break Bulk / Containerized / Specialized Satellite Tracking & Daily Customer Reports

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BY Tersia Booyzen

Delays at beitbridge and Chirundu border posts account for 30-40% of the total transport

time of cross-border operators. If this was not the case, truck utilisation could be increased by 30-40 000 kilometres per year, according to the Study of Transport Costs and Prices in sub-Saharan africa conducted by Gaël raballand and Patricia Macchi for the World bank.

The region also has very high variable costs, accounting for 85%

of the total Lusaka-Johannesburg transport costs for instance. The most important expense items are the cost of fuel and tyres which account for more than 90% of the total variable costs for most transporters. Informal payments (a polite terms for bribes), account for up to 4% of total variable costs.

In terms of infrastructure, research in east africa has shown that if the quality of roads was improved from fair to good, it could save around uS$9 000 per year per truck.

In numerous landlocked countries transport costs represent 15-20% of

import prices and these countries lose 1-1.5 points of growth per year, all other things being equal. This once again highlights the impact of high transport costs on the competitiveness of Southern african economies.

according to the researchers, the solutions to these high costs include the financing of road rehabilitation; the reduction of border crossing time; the reduction of fuel prices; and the reduction of informal payment. The accompanying table illustrates the savings that could be made based on similar data obtained from east africa.

Improved roads could save significant sums

up to 40% of transport timeBorder delays constitute

BY Tersia Booyzen

Border post delays are the main challenge for companies expanding into africa,

according to the State of Logistics survey published by the Council for Scientific and Industrial research (CSIr) in 2008.

“These findings are still true in 2009,” says David King, a researcher on the project at the CSIr.

an increasing number of companies are expanding into africa and are turning to third-party logistics providers to manage their logistics activities when operating across borders. all the companies researched used road transport as the main transport mode and border-post delays were identified as the biggest hurdle to conquer.

The proposed solutions to these delays include standard electronic clearing systems, longer border-post operating hours, better-trained personnel and improved communication between key role players.

Border post delays – challenge for African trade

SavingS that coulD Be maDeMeasures ΔTotalCosts ΔIncome PercentageΔPrice

Rehabilitation of corridor (totality) from fair to good -15% NS -7 / -10%

20% reduction of border crossing time -1 / -2% +2 / -3% -2 / -3%

20% reduction of fuel price -12% NS -6 / -8%

20% reduction of informal payment -0.3% NS + / -0%

Note: For the simulation, vehicle operating cost data from East Africa was used. NS means not significant.

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February 2009 | 3

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BY Tersia Booyzen

It is down to the final items in sorting out the one-stop border post in Chirundu between Zambia

and Zimbabwe. The old bridge will be fixed by March

and the intention is to open the one-stop border post early in april even though the official launch will only take place once the politicians have agreed on a date.

barney Curtis, the executive officer of the Federation of east and Southern african road Transport associations (Fesarta), says that this will bring a very big change to the region as it will be the first of hopefully many such border posts

to be converted to one-stop. “as it is the first in africa, there is a lot

of nitty-gritty to resolve which was never thought of when the original documents were drawn up. The biggest problem was getting each department, such as customs, health, agriculture, etc, to agree on the overall structure and operations at the border post.

“The politicians have been very good. The Chirundu one-stop border post was agreed on at a Codesa meeting four years ago and they have supported the process ever since. We are still waiting for Zambia to pass the law enabling the country to operate the post, but the minister has assured us that he will

accelerate the process. Zimbabwe passed its law quite a few months ago.

“The last few items that need attention include training, finalising exactly how the facilities are to be shared, and spelling out the detail on exactly how the border post will be managed once it is up and running.”

The next one-stop border post on the agenda is Lebombo/ressano Garcia. “unfortunately this is a bit of a mess partly because all the stakeholders weren’t involved in the original decision-making process. It will happen but not soon as the funds available are insufficient to finance the proposed new infrastructure.” Curtis said.

chirundu one-stop border post set to go in april

Barney Curtis ... hopefully the first of many.

BY Tersia Booyzen

"It is unfair to impound our trucks if they’re found to contain contraband at the border post

as we are not responsible for our drivers’ actions.”

This is the lament of many transport operators who have been on the receiving end of customs and police officials’ vigilance.

“a driver will often take the chance of supplementing his income by as much as r10 000 on a single trip by smuggling cigarettes into the country,” says an operator who prefers to remain anonymous. “If he is caught we are the ones who suffer most financially when a truck is out of action because it’s

impounded during the investigation – why would we take such a chance when we can lose more than we gain?”

but adrian Lackay of Sa revenue Service and spokesperson for the border Control Coordinating Committee (bCOCC) disagrees. “all anecdotal cases indicate strong and extremely sophisticated illicit smuggling networks in and out of South africa. Transporters cannot exonerate themselves. Often the drivers will just load the cargo as instructed without even knowing what is inside the boxes.

“The smuggling takes up different forms at different border posts. at beitbridge the biggest problem is cigarettes and other tobacco products. at Lebombo we deal mainly with

stolen vehicles. Durban is rife with cigarettes and second-hand vehicles being smuggled into the country and at all of the international airports we have to deal with narcotics and the illicit trade in abalone. In all of these cases the commercial supply chain is used to smuggle goods into and out of South africa.”

The solution, he says, is to improve intelligence and border control capacity. “For instance, Durban now has a scanner which can verify that the goods in a container are legal and match the documentation, but this is a multi-million rand investment. We have to increase our investment in equipment and competent staff if we ever want to eradicate smuggling.”

transporters challenge impounding of trucks used for smuggling‘Not responsible for drivers’ actions’ In the 2007/2008 financial

year Sars, in collaboration with law enforcement

agencies, confiscated more than 8 900 kilograms of smuggled abalone valued at approximately r30 million and 1 400 master cases of smuggled and counterfeit tobacco valued at more than r20 million.

along with counterfeit goods amounting to r333.2 million, illicit drugs – which included the seizure of one kilogram of cocaine from a single courier, two trucks, a trailer and a luxury vehicle used to commit crimes associated with illicit substances -were also seized.

What was confiscated

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4 | February 2009

FTW0017SP

BY Liesl Venter

The Port of Maputo handled more cargo in 2008 than at any time since 1977 and is well on

its way to realising its potential, says Dick Moore, commercial manager for the Maputo Port Development Company.

“In 2009 the port will handle about 100 trucks per day coming off the Maputo Corridor, compared to 15 per day back in 2003. Major developments have taken place and the potential for the port is unlimited.”

actively seeking the South african market, the port wants to become the preferred gateway not only for the northern provinces of South africa but also for countries such as Zimbabwe, Swaziland, Zambia and botswana.

Plans are under way for 24-hour operations at the Lebombo/ressano Garcia border post while road upgrades have already made a difference.

“The new highway (N4/eN4) runs continuously from rustenburg in North West right up to the new entrance at Port Maputo. Heavy goods vehicles leaving Johannesburg at 6am loaded with valuable South african exports are in the port by 2pm and, with turnaround

times of less than 60 minutes, the same trucks are back in Gauteng by 10pm with a load of imports from China or a backload from Mpumalanga,” Moore told FTW

Said one trucker, who wanted to remain anonymous, “We like this route, it's quick, uncongested and safe. Not a single vehicle has been hijacked since the port opened in 2003.

“all in all the transit experience is much easier and more efficient than it was. This has been achieved by processing commercial vehicles at secure customs depots located on either side of the frontier, 4 or 5 kilometres from the crossing, thus reducing congestion at the frontier itself which is reserved for cars and pedestrians. Huge improvements have also been made in terms of customs and immigration resources and there is a far higher level of operational integration between the South african and Mozambican authorities.”

the key to Maputo Corridor growthOne-stop border post

The Port of Maputo ... huge potential.Photo Inset: Dick Moore ... ‘Actively seeking the South African market.’

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February 2009 | 5

BY Tersia Booyzen

"The beitbridge infrastructure will collapse by mid 2009 if nothing is done. and both governments

are aware of this,” says angeline Mashiri, the head of the Zimbabwe revenue authority (Zimra) at beitbridge.

“I have already written to get authority to use the old bridge for vehicle traffic again; we are now just waiting for the bridge to be inspected.

“Depending on the recommendation of the inspectors, we have a number of options on how to utilise the bridge. We can separate the north and southbound traffic via the old and new bridge or, if we cannot run commercial traffic on the old bridge, we can run it on the new bridge and use the old bridge for private traffic.

“Processes are not the problem, infrastructure is. as long as we do not have four lanes to South africa and four lanes to Zimbabwe we will have problems. Currently all lanes convert into one which is a major cause of congestion.”

Mashiri also notes that the lack of pre-clearance and adequate parking

for commercial vehicles on the South african side is a major problem.

“Traffic should flow continuously. We can move 30 cars, 20 empty trucks and 20 loads from Zimbabwe but then we have to wait for parking spaces to become available on the South african side or all the traffic gets stuck on the bridge. We currently have guys with walkie-talkies on the bridge to let us know when there are parking spaces for trucks.

“all trucks, except for those originating locally, have to be pre-cleared in Harare for Zimbabwe or else they are turned back at the border post. but this is not the case for South africa and they are therefore not ready for the trucks from our side. The ideal would be for all trucks to have pre-clearance for both sides of the border as this will ease congestion considerably.

“On the part of Sars and Zimra, we have really tried and I am getting all the co-operation I need. What is not spread over the 24 hours that we are open is the movement of trucks. There is a need for some form of professionalism from all stakeholders. The industry needs to complement each other.

“agents must get up if they are phoned at two in the morning and a truck is waiting or otherwise the transporters need to go to someone else who will. Mismanagement in the offices of transporters should not become the problem of customs.”

Beitbridge infrastructure is on the verge of collapse, warns Zimbabwe

CBC adds Angola service

Angeline Mashiri ... 'Processes are not the problem.'

FTW1530SD

Customs issues strong plea to stakeholders for 24-hour buy-in Six years since its launch Cross border Cargo has more than met its development

goals, says managing director Mario Nortje.

Offering an all-encompassing service portfolio – including FCL and LCL services both domestically and cross-border, warehousing, special projects and air and road overnight express – the company believes in a customised approach.

“We will find a solution,” says Nortje. “Our advantage is our ability to act quickly, within or across our borders.”

The company has recently added angola to the list of countries it serves, providing its Cape and Gauteng customers with a roadfreight option from origin to delivery in Luanda.

“Our clients tend to find the airfreight option expensive and limiting and we seem to achieve similar lead times due to flight capacity issues into Luanda.”

CbC serves Zimbabwe, Malawi, Zambia, Mozambique, DrC, botswana, Lesotho, Namibia, Swaziland and angola.

FTW1461SD

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6 | February 2009

BY Tersia Booyzen

"If all of our resources were utilised over 24 hours then not much would need to be done to ease the congestion

at beitbridge,” says rudi Kitching, the head of customs at beitbridge border Post.

“beitbridge is a 24-hour border post facility and our customs officials work in shifts to ensure there is a continuous clearance of cargo so that traffic can flow. unfortunately transport operators have instructed their drivers not to drive at night so, as soon as it gets dark, they disappear into one of the overnight parks and they do not even attempt to get clearance until the next day.

“The customs officers who work the night shift then have very little to do and the next day there is even more work for the day shift. We do not have too few people to do the work; they are just not being utilised optimally due to the stated operating hours.

“If you improve the infrastructure at the border post by building more lanes or an additional bridge, then we can go back to limiting the hours that the border post

is open. We need to look at all parties, including drivers, agents, customs, immigration and everyone else to resolve the problems,” Kitching notes.

While transport operators agree that they do have a policy that drivers should not drive at night due to the high risk of accidents, they are however adamant that this does not include the driver being unavailable to clear customs at night.

Tony bouwer, who works with both Professional Consolidators and Fourway Haulage, says that the problem exists because clearing agents keep office hours. “When beitbridge became a 24-hour border post the agent agreed to work from seven to ten, but a lot of them are not coming to the party, both on the South african and Zimbabwean side. The agents are knocking off at four and while Zimra is processing documents throughout the night, it is not working as well on the South african side.”

Daylight-only driving policyhinders flow of traffic at BeitbridgeAgents not making the most of 24-hour border operation

Tony Bouwer … ‘The agents are knocking off at four while Zimra is processing documents throughout the night.’

Pre-clearance streamlines proceduresBY Tersia Booyzen

The provision of an efficient customs pre-clearing service for cargo moving to and

from the SaDC countries through beitbridge is part and parcel of the service offered by Linked Logistics, a chain of companies that includes regional Link in Johannesburg, beitbridge border Clearing agency at beitbridge and Professional Clearing throughout Zimbabwe.

The service, individually tailored for each client’s requirements, provides improved transit times at beitbridge border control, and is linked to a monitoring and status reporting service, says brian Kalshoven of bbCa. “early in 2009, these services will be available to clients on a password-accessible link through the Linked Logistics website,” he told FTW.

“users of the products will be able to follow the progress of their vehicle, via their own unique connection to the website, through beitbridge.”

Overborder road & air services to:

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BEITBRIDGE BORDER CLEARING AGENCY

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Tshengi Ndlovu Bulawayo: Tel/Fax: +2639 67953/ 74377/ 74130 E-mail: [email protected] Skype: tshengi.ndlovu

Brian KalshovenBeitbridge Border Post, RSA: Tel: +27 15 530 0110 E-mail: [email protected] Skype: brian_bbca

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February 2009 | 7

BY Tersia Booyzen

Parking is the biggest issue on both sides of the beitbridge border Post, according to Ian Cooper, a director

of Cargo Services and representative of the South african association of Freight Forwarders (Saaff).

“On the South african side there is parking for only 70 trucks, of which ten to 15 bays are already used by vehicles that have been impounded by customs - but we are doing more than 600 a day. There

are old houses which were supposed to be demolished to make way for 200 vehicles but this hasn’t been done. Trucks don’t have place to park and therefore drivers disappear and we have to look all over town for them.

“In addition, beitbridge is the busiest border post in africa but Sars only has 83 staff members. There seems to be no productivity in customs and no urgency.”

Lin botha, managing director of Sediba Clearing and also a SaaFF representative, adds that before you even get to the gate you have four separate stops, including customs, the police and anti-smuggling checks which all wastes more time. Depending on your cargo, you can also be checked separately by the departments of health and of agriculture.

The question is why these different departments cannot work together and check the goods simultaneously at a single stop?

“every government department wants their finger in the pie and good luck with trying to get them to work together,” is botha’s response. “unfortunately accreditation and pre-clearance doesn’t stop you from having to get these checks and therefore doesn’t speed up releases. The idea of a holding area is by far the better idea – it is even better than a one-stop border post.”

Disunity sabotages smooth border operation

Ian Cooper ... parking a major issue.

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8 | FEBRUARY 2009

BY Tersia Booyzen

Beitbridge border post has recently seen a tremendous upsurge in the number of northbound commercial

vehicles carrying food aid to Zimbabwe and, of course, returning empty.

“Having these trucks in addition to the 300-500 commercial vehicles that daily use this border post has meant that there have inevitably been some traffic queues, but these have been cleared within the day, with customs and affected agencies coming in and working through the night to clear the backlog," says Brian Kalshoven of Beitbridge Border Clearing Agency, part of the Linked Logistics chain.

“It has been estimated that a vehicle carrying certain types of goods may need the blessing of as many as 14 different government departments in order to obtain clearance,” he told FTW.

He notes that the numbers of return loads have unfortunately reduced with the value of the Zimbabwe dollar.

Imports of agricultural produce, raw materials and manufactured goods from that country have dwindled to a trickle.

The world recession and its effect on prices of mineral products supplied from SADC countries have seen a further drop in this type of load.

“Recession notwithstanding, the Cross-Border Road Transport Authority (CBRTA) together with the South African National Roads Agency Limited (Sanral) have completed construction of the new traffic control facility half a kilometre south of the border post. Only the electronics and equipment now need to be installed.

“Word around the border is that commissioning will be in March – although rumours abound as to the checks and facilities that will be implemented and provided at the centre.”

According to Kalshoven, there will be a weighbridge, road permit examination offices, vehicle roadworthiness checking facilities, a load adjustment area and an

area where bus passengers can alight while their vehicles are checked or repaired.

“It goes without saying that having the centre operational will cause disruption to traffic on the N1,” he added. “The design requires that some northbound traffic will have to cross the N1 at an intersection, which it appears will be traffic-light controlled,” he said.

Surge in food aid to Zim clogs up BeitbridgeNew traffic control facility completed

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FEBRUARY 2009 | 9

Industry and government should jointly address efficiency

BY Liesl Venter

It’s all systems go for logistics company Texcon with major plans in place to dramatically increase

volumes in 2009.According to managing director Neil

Harris, much groundwork was done in 2008 assessing, performance managing and visiting all the company's agents. “Our foundation is now in place to manage the expected volume growth this year.”

Texcon, which provides a range of specialised transport and logistics services globally, where necessary tailors a solution in order to meet the specific requirements of each customer. Offering sea, air and road transportation, international courier or freight, Texcon provides a full basket of logistics solutions to any exporting or importing customer to or from any of the six continents around the globe.

“Years of experience in cross-border transport allows us to offer a highly specialised service for the movement of all types of cargo using any mode of transport throughout Africa. Texcon has agents throughout the region to ensure a fully integrated African

footprint,” says Harris.“For roadfreight, the borders on

the continent remain a challenge in terms of efficient service delivery although everyone is in the same boat. We manage border control through extremely good and long-term relationships with most border officials and in-house agents.”

Border inefficiencies affect the cost of the movement, says Harris. “The problems are mainly due to the lack of infrastructure to support growing traffic volumes and a shortage of experienced staff at the border posts.”

But despite the obstacles Texcon managed to deliver to all the Engen and Caltex service stations cross border before the fuel increase. “These were display boards, stickers and other promotional items for instance, promoting how pump prices should be calculated due to the pumps being unable to accommodate four digit numbers,” said Harris, who firmly believes that transport companies along with governments of African countries need to work together to create greater operational efficiencies and harmonised procedures and documentation.

Texcon anticipates volume growth

FTW

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The

choice for trucking into Africa

Tel: + 27 11 974-2021/2/3/4 Fax: + 27 11 974 2058email: [email protected]

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Destinations: Zimbabwe Zambia DRC Malawi Mozambique

Freightowarders’

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10 | FEBRUARY 2009

BY Liesl Venter

Amajor player on the N3 corridor, Freighthaul has dedicated a fleet of 35-40 vehicles to service the

cross-border market.According to managing director Paul

Botha, Freighthaul is not a newcomer to this market and has long-standing relationships with cross-border clients. “Traditionally we serviced them by handling their containers to Johannesburg only, but the company has grown significantly and our key focus is on productivity – getting the most out of our fleet.”

It was pressure from the South African market that motivated the decision by Freighthaul to develop its cross-border infrastructure and dedicate a fleet to the market.

“The move was strategic in further developing our relationship with our clients and the needs they have,” said Botha. “Also, South Africa being the gateway to Africa has always played a significant role as a logistical solution. Current trends show that volumes going up north are on the increase and the

mining sectors north of our borders are becoming reliable global suppliers. Therefore we foresee that this market sector will offer good growth over the medium term. Naturally it comes with its own challenges dealing with different

cultures and regulatory requirements.”While 2009 is not predicted to be the

most financially viable year, Freighthaul is confident it can grow strategically in the cross-border market. “Adhering to our business principles we believe we can meet the challenges that present themselves in the process. We will focus on servicing markets where we have alliances and that will offer us sustainable growth,” said Botha. “Our competitive advantages are the size of our fleet and our relationships with the industry as a whole – that is not only the clients but suppliers alike and we network to meet the needs of the client and tailor-make solutions wherever possible.”

Said Botha: “This year will be a year of consolidation and ensuring that we streamline operations to ensure maximum productivity and effective service. Given the current market situation we don’t foresee too many transport companies seeking out new ventures – we are at a time and place where as a business we need to be very in tune with how the market is behaving.”

Productivity is the focusas Freighthaul makes its mark in AfricaFleet of 35-40 vehicles dedicated to the market

Paul Botha ... no newcomer.

Freight and logistics industry still hiringBY Tersia Booyzen

"The year has started out remarkably busy for us, despite gloomy

predictions from economists,” says Joshua Alexander, national manager of X-Act Placements.

“Although there are many retrenchments taking place at the moment, the need for skilled individuals is still high,” says Alexander.

Recruitment in the shipping industry is a highly competitive arena and X-Act Placements has entrenched itself as a supplier of premier personnel, he added.

“The company offers a database of over 5 000 top professionals to its clients.”

X-Act Placements was established in 2006, servicing the freight and logistics industry.

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BY Tersia Booyzen

Keeping up with the supply of containers to the Zambian freight market has been an ongoing

challenge, says Aileen Ryan, marketing manager of Celtic Freight.

“Summer rains, pilferage, security, cargo control, ease of packing... these are all reasons for cargo to be containerised. Celtic Freight has been hard pressed to turn its container fleet around on its Zambian service. The company has some 180 containers in its owned fleet, but is doing everything possible to turn this stock around to have available containers in Durban and Johannesburg for clients’ use,” says Ryan.

“The usual reasons for containerising cargo and the added demand stemming from the shipping lines’ lack of flexibility and high demurrage charges on over-border containers have added to our customers’ requirements. Prior to Christmas we simply could not keep up with demand and unfortunately had to turn away bookings simply because of we didn’t have enough containers – all the worse because we had truck capacity to actually move this cargo.”

But Celtic has caught up and containers are again available for Zambian cargo, she told FTW.

Celtic offers a service to the forwarding industry where it unpacks shipping line containers under customs supervision at its Durban depot into owned containers. This means Durban turn-in is achieved, the desperate time constraints are alleviated and the cargo is still delivered to Zambia containerised.

“Forwarders have enjoyed the benefits of cargo being removed from port, the shipping line box turned in and the final payments sorted out with their customer.”

Demand for containers to Zambia unprecedented

Aileen Ryan ... 'Prior to Christmas we simply could not keep up with demand.'

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BY Liesl Venter

Having already seen a downturn in business, prospects for 2009 are not looking rosy.

But, says Kevin Dagnin of Kay Hil Freight, remaining hands-on with high levels of service will go a long way to keeping the business viable through tough times.

“We expect 2009 to be difficult having already started to see a downturn in

business as early as August last year,” says Dagnin, who along with Hilary Woelk created Kay Hil Freight in 2000.

Specialising in freight forwarding and customs clearing to Lesotho only, Kay Hil offers a daily courier line haul and distribution service.

By specialsing in one country, the company is able to control its operation and run a tight ship, says Dagnin.

“I am based in Johannesburg while Hilary is in Lesotho. We have built

In tough times,hands-on service will keep business viable

BY Liesl Venter

Adjustment will be key for companies wanting to remain viable in the cross-border market

in coming months, says Gordon Jay of Transworld Road Freight.

Launched in 1993 with three depots in Johannesburg, Cape Town and Windhoek, Transworld Road Freight has continued to grow through its ability to adapt and adjust to the times, says Jay.

“Cross-border cargo has become very competitive in recent years with many companies having entered the market when things were booming,” says Jay. “Last year’s fuel price saw some of these companies disappearing, but competition remains strong.”

With its core business being groupage, Transworld Road Freight is a customs-accredited and registered remover in bond.

“I expect 2009 to be a very tough year with the world entering into a recession. I think the fuel price will rise again and so things will be tight,” says

Jay. He believes 2009 will be a year to consolidate the company’s position in the market place.

“Our main obstacle is still crossing the border posts. Delays are common and during the peak period we had delays all the time. The different methods of weighing axles in Botswana has also caused us some problems,” said Jay. “We cross the weigh bridge at Pioneer gate and they weigh individual axles and let us go through. When we reach Mamuno they weigh axle sets and fine us for being overloaded on one or other axle set. To us this looks as if it is planned, as they hit us with hefty fines and hold our trucks till we have paid. Because of the urgency of moving the freight we are forced to pay without being afforded the opportunity to state our case. Insurance is also becoming unaffordable.”

Being able to deal with such issues while still offering a competitively priced service will make all the difference in the coming months. “Of course having a positive cash flow will be a definite advantage.”

Inconsistency in axle weight allowances adds challenge for hauliers

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In tough times,hands-on service will keep business viable

Inconsistency in axle weight allowances adds challenge for hauliers

Gordon Jay ... competition remains strong.

FTW1402

BY Tersia Booyzen

Cargo that should go to consolidators has been moved to buses and this is becoming

a critical issue for us,” says Christine Gerber, chairperson of the Zimbabwe Clearing Agents Board.

The buses are not only loaded with cargo on empty passenger seats, they are also pulling 40 foot containers loaded to capacity with luggage and other baggage. But even more extreme are buses with cargo loaded metres high on top of them. “It takes hours for this cargo to be inspected as it needs to be unloaded and then reloaded again,” says Gerber.

She notes that the need for the separation and classification of buses is critical. “We need to know which of these buses contains business clients as opposed to tourists as it affects the turnaround time of buses significantly and adds considerably to the delays experienced at the border post.”

Consolidators lose out as cargo moves by bus

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FTW4268

relationships with Sars and LRS (Lesotho Revenue Service) and this helps speed up customs-related queries,” says Dagnin.

Client satisfaction is high on the agenda for the organisation with deliveries in Maseru completed daily before 12pm while they also cover all outlying areas. This, says Dagnin, is thanks to a local collection and delivery fleet in Lesotho.

With a combined staff of 40 employees in South Africa and Lesotho, Kay Hil

Freight knows its market.“By using freight/courier companies

who specialise in cross-border operations, clients will find that their consignments are delivered expeditiously. Their knowledge in preparing and submitting customs documentation, as well as their local knowledge of the country, is the secret of a successful transaction.”

Woelk was recently voted in as chairman of the newly formed Lesotho Freight Forwarders’ Association.

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14 | FEBRUARY 2009

BY Joy Orlek

Three years since its entry into the overborder market, transport specialist Manline has recorded

exponential growth – and is cautiously optimistic about the year ahead.

Established in 1998 as a domestic transport operator, the company diversified its operations based on customer demand and launched a service in and out of Botswana in 2005.

This was followed by Zambia where Manline currently operates a 50-truck fleet on a regular basis. “Flat deck Superlinks are our speciality, and with our tankers we are able to provide a world class service to our clients,” says marketing director Fearne Gilson. In total the company’s current fleet comprises 300 vehicles.

A regular service to Zimbabwe is also on the planning boards

While Manline has served the country on an ad hoc basis, the volatility of the market remains a challenge, says Gilson.

“The boom in the resources market has made Zambia a very attractive option and our results for the past year

have been fantastic.“We believe that Africa holds huge

potential, and much like the local market, diversification is key

“Mining has been the biggest growth area on the Zambia route but we are moving various products in and out of Lusaka – there’s a lot of development there thanks to exponential growth in the Zambian economy.”

While the current financial crisis has tempered last year’s very positive outlook, Gilson remains bullish.

“There’s still a requirement for copper around the world, although we have seen a move to finished product rather than concentrates.”

And when it comes to competitive edge, Gilson believes technology plays a big role.

“Manline was one of the first logistics companies in South Africa to install real-time satellite tracking in its fleet,” says Gilson. “At the heart of our innovation is our enterprise software platform, MAX (logistics Management And eXecution) which provides a real-time, 24/7, internet-based operating platform and database for the company

and its customers. “It automates our entire operation,

from customer needs analysis and fleet management through to back office

and reporting.”Based in Pietermaritzburg, Manline

has a network of nine offices, including Zambia.

Diversification is key

Thumbs-up … driver Jimmy Shezi with managing director Neil Henderson (left) and marketing director Fearne Gilson.

Zimbabwe on the planning boards

FTW1421SD

FTW1604SD

as Manline looks into overborder expansion

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BY Tersia Booyzen

Putting 20 new 30-tonners on the road to transport steel and fertiliser to Malawi, Zimbabwe,

Zambia and Mozambique and to bring back tobacco, cotton, wheat bran and the like is very encouraging given the current economic predictions of doom and gloom.

“The market is looking all right and we deal mainly with South African companies so there are no problems with payments,” says Corné Pretorius, the managing director of Kodav which has put the additional new trucks on the road in association with Zimbabwean partner, Leopack Transport.

Malawi is the company’s busiest destination and they are also involved in transporting aid relief, mainly food products. He notes that with the world

economy as it is at the moment, it is difficult to predict the future but he believes a possible growth area for 2009 could be Zimbabwe. “If Zimbabwe comes right, trade and transport will explode,” he says.

“The delays at border posts are also improving – over Christmas the delays were enormous, mostly at Beitbridge. While we usually cross within 12 hours, the past few weeks it took three to four days to cross. There was a hell of a lot of traffic and my suggestion is that they open another bridge; I can’t think what else they can do.

“While the roads into Africa are not improving, there aren’t really any other problems. Last year the only incident in which a Kodav truck was involved was a minor one when a horse was bumped. We obviously do not drive at night as it is too dangerous,” Pretorius added.

Twenty new trucks on the road

Security company to introduce tamper-proof labels

The introduction of tamper-proof labels to mark cargo moving into Africa is one of the

innovations on the planning boards at G4S Special Cargo Handling.

With several additional services under negotiation, general manager Andre Du Venage believes it’s all about identifying opportunities to continually meet customers’ changing requirements.

And his outlook for business growth on the continent is bullish.

“South Africa is expanding with more and more opportunities becoming available in countries such as Mozambique and Angola.

“We are seeing significant

investment into Africa from China and that is creating opportunity.

“We should be looking for cross-border opportunities now.”

SCH has doubled in size over the past year in terms of staff and vehicles, and further expansion into Africa is on the cards for the year ahead.

“We have established a good track record when it comes to averting attacks on cargo due to the standard of infrastructure and our technological capabilities,” says Du Venage. “Africa has been a neglected area in the global business environment, but I believe the continent’s time has come.”

Malawi is the busiest destination.

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16 | FEBRUARY 2009

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Overborder specialist Dynamix Freight Africa has added a weekly consolidation service

to the DRC to its service portfolio, complementing its FCL option using Super-links and triaxles on the route.

Initially the groupage service covers Lubumbashi, but it will be extended to other destinations on demand, says managing director Kay Sendel.

“Cargo is routed via both Botswana

and Zimbabwe, and over the past year we have achieved a transit time of 7-12 days per trip,” says Sendel.

The route has clearly proved to be a lucrative option.

“It’s taken off tremendously,” says Sendel, “due to mining investments and the subsequent strengthening of the local economy.”

He acknowledges that the year ahead is not without challenges. “There’s the

political scenario in the DRC as well as the global financial crisis which has also hit the DRC hard, with commodity prices taking a dip. Yet the forecast for the mining industry in the long run is positive and more investments will take place.”

Dynamix has been involved in food projects for the southern DRC as well as business for the mining houses. “Both have increased our volume

substantially over the past year and we believe that this will continue in the year ahead.

“Although the year has started slowly, we are seeing more business coming through now.”

Sendel would like to see more investment in road infrastructure to speed up the turnaround time of trucks. “No doubt future investments will take place in the DRC.”

BY Tersia Booyzen

"Perhaps our software may not be the only answer to the current congestion

experienced at South Africa’s busiest ports and border posts, but we’re offering 21st century solutions to a persistent problem,” says Michael Henning, marketing manager for Easyclear, a Johannesburg-based software solutions provider to the freight forwarding and clearing industry.

Featuring an application that is packed with software for imports, exports, forwarding, warehousing

and finance, the service provider believes its powerful over-border module that is extensively used by agents operating at South Africa’s borders with the SADC and other neighbouring countries, is making a difference.

“With an increase in road freight exports and an ever-increasing need for solutions that provide fast and efficient clearing as well as tracking for our clients, Easyclear has developed a module that is specific to this type of business model. It can accommodate clients in remote areas where there is very little infrastructure and communication

while at the same time maintaining its vital communications with South African Revenue Service for EDI,” explains Henning.

“Over-border clearances are handled within minutes by the system and the application can even produce the import SAD500 entry, integrating and communicating with ASYCUDA, our neighbouring countries’ answer to the Sars CAPE system,” adds general manager CJ Pagel.

Software solutions facilitate border clearance

Groupage service to DRC takes off

Michael Henning ... accommodating clients in remote areas where there is very little infrastructure and communication.

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FEBRUARY 2009 | 17

FTW1611SD

BY Tersia Booyzen

Theoretically, all transit goods will soon be able to sail through customs throughout the entire

Southern African Development Community (SADC) region without any delay, says David Watts, a consultant for the South African Association of Freight Forwarders (Saaff).

The European Union has committed €18 million through the European Development Fund to cover the cost of a Customs Modernisation and Trade Facilitation programme targeted at an eventual Custom Union in the SADC region.

A major platform of the programme is the implementation of a Regional Transit Management System (RTMS) designed to allow for the movement of road transit cargo throughout the region with the fewest possible customs delays at border posts.

“The RTMS protocol has two critical elements; one is the use of a single administrative document (SADC Transit Document) which, once submitted and endorsed by customs at the point of origin, will be accepted

by administrations in each transit country, obviating the need for separate declarations at border posts. The other is the introduction of ‘regional’ bonds or sureties which, when issued in the origin country, will guarantee duty and tax to all customs administrations along the transit corridor,” Watts explains.

The protocol, which places obligations on all parties in the transit chain, including state administrations, carriers, forwarders, guarantors and exporters, has been signed by all the relevant SADC countries.

The programme commenced on January 1, 2008 and is additional to various other projects designed to help the region meet the goals of the Regional Indicative Strategic Development Plan (RISDP) as adopted by the heads of state of all SADC member countries in August 2003.

“Implementation has been delayed for a number of technical reasons, including the need for legislative changes in member states. However, it is hoped that the scheme, which is not obligatory and will run in tandem with the legacy processes, will become fully operational during 2009,” Watts told FTW.

EU assists SADC in developing a regional customs transit scheme

Africa specialistwith a handle on Angola

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FTW4278

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18 | FEBRUARY 2009

BY James Hall

The success of cross border transport regionally to some extent depends on Swaziland’s infrastructure.

Both for road and rail, the small landlocked country is disproportionately active in the movement of goods. Swaziland is a “bridge country” where SA goods moved by rail pass through in transit to Durban, and SA cargo moved by road to Maputo uses the country for passage.

It is therefore always good news when Swazi officials announce they have found a donor foreign government or agency to fund a new highway or rail upgrade, or that movement can be detected in the glacial pace of extending border post operating hours so that customs services at the border (coordinated between SA, Swaziland and Mozambique) can function on a 24/7 basis. Swazi officials always frame talk of extending border hours in terms of tourism, but in fact road commerce would be the principal beneficiary – or rather the Swazi economy would receive the biggest

boost from additional road transport activity.

Presently, even the country’s busiest border post at Oshoek, which is favoured by most traffic going to and from Gauteng, operates at the extremely limited hours of 07:00. to 22:00.

Swaziland’s embrace of SADC protocol-mandated electronic clearance of goods has been fitful. More training for customs personnel is essential, road freight sources say. Swazi customs officials seem reluctant to change their old ways of doing things, resulting in a continuation of now quite unnecessary waits for goods clearance coming from SA.

Or does the fault lie with another “old way of doing things” that customs agents are loath to discard?

Some road freight operators suspect Swazi customs agents are dragging their feet on implementing electronic customs clearance because there are few opportunities for malfeasance once it is operating.

2009 will likely see the matter resolved, one way or another.

Operator reluctanceholds back extended Swazi border post hours

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The scene at the Oshoek border post.

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BY James Hall

For advice on doing overborder clearing and forwarding, it’s logical to go to a reputable firm

with overborder as part of its name. Willie Stuart, founder and owner of Speedy Overborder, says that a reason the Jo’burg to Gaborone route is one of his company’s most profitable is that the drivers have “down pat” the procedure to move goods swiftly through border customs operations.

But more use of available technology would make cross border passage not only faster but also more coherent, so that clearance becomes a routine procedure with no surprises.

“Data should be entered into a central system available to all nations’ customs services, telling them that a truck is coming through. This is what the SADC protocols are calling for. It should be as easy as using an ATM machine. Trucks with their cargo already entered should be waved right through once their identification code

is checked by customs agents,” Stuart said.

Fuel prices may be an unpredictable factor, but efficiency and cost savings can become institutionalised if customs agents use the tools already at hand.

An example Stuart cites is the situation at the Swaziland/SA border, where his company’s trucks travelling from Gauteng with their break-bulk cargo for overnight delivery are passed by SA customs, but then have to endure a second inspection by Swazi customs.

“It’s as if they don’t trust the South African agents and they want to do the whole procedure again. For a delivery service like ours when every minute counts, this is a problem that should not be,” said Stuart.

But addressing such problems – Swazi trucking firms are in communication with their customs department – is what Speedy Overborder has come to be known for in its two decades of service – an asset valued by its customers.

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20 | FEBRUARY 2009

BY James Hall

Swaziland Railway owes its economic viability to the nation’s status as a “bridge country,”

through which cargo from neighbouring nations passes. Swaziland has its own imports, including industrial inputs, to bring in by rail, and exports, mostly coal, agricultural products and finished garments, to bring out on rail wagons. But it is the considerable volume of goods making their way north-south from Komatipoort en route to Durban that brings in important revenue.

So it was logical when Lesotho decided to investigate the creation of its own rail system that it turned to Swaziland Railway for advice.

“They were interested in hearing about cross-border transport of cargo,” said Gideon Mahlalela, CEO of Swaziland Railway and recent president of the Southern Africa Railway Association (Sara).

“They see Lesotho as a way for South Africa’s rail cargo to go to destinations by more direct routes through their country,” he said. “We are advising them.”

Interconnectivity with its neighbours characterises Swaziland

Railway, which turns 45 years old in 2009.

The company leases its five locomotives from Transnet Freight Rail, but owns its own oil wagons and sugar wagons. All Swaziland’s petroleum products come from SA, and sugar continues to be the country’s top export in terms of volumes.

‘Make sure paperwork is in order’BY James Hall

Make sure your paperwork is in order, and it is smooth sailing crossing the borders

of Botswana, Lesotho, SA and Swaziland, advises Sharp Freight, the Swazi-owned clearing and forwarding firm that carries goods to all the mentioned countries.

“We are lucky to work in countries where there are relatively fewer problems at borders. Customs is cooperative if all the forms are filled out,” said Service Magagula, a company director alongside Jabu Vilakati and Shadreck Mnisi.

“But if something is left out, this can delay the whole process,” Magagula warned.

Garment companies and their suppliers in Botswana, Lesotho and Swaziland employ Sharp Freight to move raw materials and finished garments. SA roads are the conduits between the landlocked countries.

“There is a lot of exchange between the garment companies. It’s a major business,” said Magagula.

To accommodate more goods, a major renovation of the company’s warehouse commenced in January. Its location in a new section of the Matsapha Industrial Estate outside the Swaziland commercial hub Manzini provides easy access to road links and the country’s only airport, located five minutes away.

Gideon Mahlalela ... interconnectivity.

Jabu Vilakati ... 'Customs is co-operative.'

‘Bridge country status’ keeps Swazi rail viable

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BY James Hall

For a road freight firm specialisng in cross-border transport since the 1970s, wisdom learned

from millions of kilometres travelled between countries is worth a listen. One bit of advice offered by Sikelela Vilakati, managing director of Chrisilda Transport, is for operations managers of road haulage firms to be prepared to rush to the scene of an emergency.

“You never know when something may happen, even on a route you drive every day for years without a problem,” said Vilakati, recalling how recently he had no alternative but to drop what he was doing and go to Maputo when Mozambican customs for some inexplicable reason impounded a truck.

“Thank goodness it wasn’t perishables,” said Vilakati, whose main commodity to Maputo now is the importation of soft drink bottles used by Coca-Cola.

From its base at the Matsapha Industrial Estate in central Swaziland, Chrisilda’s fleet of 34 cross-border trucks fans out to Lesotho to deliver food aid for the World Food Programme, as well as doing the regular Maputo runs. Trucks ferry goods daily to and from Johannesburg and Durban, and ply a plethora of other SA routes. Occasionally, a customer requests road service to or from Botswana.

“It’s important to handle problems the moment they arise. You don’t make money if the wheels aren’t moving,” said Vilakati.

BY Tersia Booyzen

Poor road, rail and harbour facilities add 30 to 40% to the cost of goods traded among

African countries. The expense of moving Africa's imports to customers inland is on average 50% higher

than shipping costs in other low-income regions.

The lack of modern storage and marketing facilities is a major contributor to food insecurity, with losses to spoilage accounting for as much as 30 to 40% of grain harvests in some countries.

These are the estimates provided to the United Nations’ (UN’s) African Renewal by the Infrastructure Consortium for Africa (ICA), whose members include the Group of Eight industrialised countries, multilateral development institutions and the Development Bank of Southern Africa.

Closing the infrastructure gap is therefore vital for Africa’s future. But this will not come cheaply. UN Secretary-General Ban Ki-moon last year called for more than $52 billion a year in public and private investments to close Africa's infrastructure gap by 2010.

Trucks queuing for petrol at the Chrisilda yard at Matsapha.

Trouble-shooting is part of the deal

UN cites poor infrastructure as Africa’s biggest limitation

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BY Liesl Venter

Implementing a complete “track and trace” system is one of the ways M&B Transport is improving its service across

the borders of AfricaWith three offices opened in

Swaziland, Botswana and Durban in the past three years, the company is set to outperform its 2008 targets this year, despite the economic crunch, says Daniel Singleton, M&B Transport general manager.

“Our cross-border cargo has seen a definite increase in recent years, especially to Botswana and Lesotho.”

He attributes the growth to good representation and word-of-mouth validation of its service.

“Our new track and trace system will allow clients to log onto the internet and with their unique password track and trace their goods at any given time.”

According to Singleton this process will save not only time but also money. “To add further value to our service, we have increased our fleet capability with four

more long haul vehicles and four local distribution vehicles.”

This, Singleton said, was despite the market suggesting caution. “We have to be able to service our market fully and to do that we had to grow the infrastructure.”

Fleet expansion to cater for expected growth

New track and trace system adds value for M&B customers

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on Projects into:

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Expectations of a crackerjack year for cross-border transportBY Tersia Booyzen

"Zambia, Zimbabwe, Mozam-bique, Malawi – all the traditional routes

are continuing to grow despite economic woes and political insecurity. Last year was a crackerjack year and we expect the same for 2009,” says a bullish Alwyn Nel, managing director of Kingfisher Freight Services.

“In the latter part of 2008 there was so much going through that we had a major shortage of vehicles. The hold-up in truck availability was usually caused by empty inbound trucks being delayed at the border posts, something that is almost beyond imagining. The offloading of bulk cargo at agents’ premises in South Africa is also very time-consuming and sometimes trucks have to queue for two days.

“There are still inherent delays at border posts, especially at Beitbridge and Kazangulu. This should however come as no

surprise to transporters so they should pre-plan for it and manage their operations so that it isn’t such a major factor.

“The orders we have for 2009 include some nice parcels, with maize and fertiliser taking up a good percentage of our fleet. Even though copper is down in Zambia there is still all manner of goods moving there, including mining machinery, white goods, building material and lots of aid from the United Nations. Over and above the domestic stuff we are also moving a huge amount of transit bulk cargo coming from overseas.”

The cargo is a mix of old and new orders, says Nel. “We have handled new stuff this month that we have never handled before. We are even hiring more staff. Unfortunately when there is a downturn a lot of people become negative and they don’t actually do anything. It is tough out there but with hardship comes opportunity. You have to be smarter and think out of the box and you will do well.”

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