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Expert Meeting on
REGIONAL COOPERATION IN TRANSIT TRANSPORT: SOLUTIONS FOR
LANDLOCKED AND TRANSIT DEVELOPING COUNTRIES
27–28 September 2007
Need for Transit Corridors to
Ports with Capacity
by
Brenda Horne CEO, Maputo Corridor Logistics Initiative (MCLI)
This expert paper is reproduced by the UNCTAD secretariat in the form and language in which it has been received. The views expressed are those of the author and do not necessarily reflect the view of the United Nations.
UNCTAD Expert Meeting on Regional Cooperation in Transit Transport, Geneva,
Solutions for Landlocked and Transit Developing Countries
27-28 SEPTEMBER 2007–BRENDA HORNE – CEO of MCLI
PURPOSE OF MY PRESENTATION – INDUSTRY VIEWS AND EXPERIENCES ON LOGISTICS – NEED FOR TRANSIT
CORRIDORS TO PORTS WITH CAPACITY
Gateways in Southern Africa • in an environment of continuous SA economic growth • versus a backlog in infrastructure investment and
development, • Industry is faced with challenges resulting
from congestion – roads; rail and ports, • with the alternative ports of Maputo and Walvis Bay in
the neighboring countries creating much needed capacity
• and also stimulating regional integration and growth• SADC - Initiatives
GATEWAYS THROUGH CORRIDORS OF SOUTHERN AFRICA
SDI CORRIDORS IN
SOUTHERN AFRICA
SADC Trunk Road Network and Regional
Ports
Mal aw
i
Gabon Congo Kenya
Zambia
BotswanaNamibia
South Africa
Mad
agas
car
Mauritius
Moz
ambi
que
Tanzania
BurundiDemocratic Republic of Congo
Rwanda
Zimbabwe
Uganda
Angola
SwazilandGeo
grap
hica
l Map
of S
AD
C &
Eas
t A
frica
Rai
l Lin
esG
eogr
aphi
cal M
ap o
f SA
DC
& E
ast
Afri
ca R
ail L
ines
CO
MPA
RIS
ON
OF
GLO
BA
L LO
GIS
TIC
C
OST
S A
S A
PER
CEN
TAG
E O
F LA
ND
ING
PR
ICES
OF
IMPO
RTE
D/E
XPO
RTE
D G
OO
DS
GLOBAL COMPARISON OF TRANSPORT COSTS
0
10
2030
40
50
60
Zone
Africa
North
America
AsiaEas
t Afric
aSoth
ern A
frica
Malawi
ZONE/REGION
% O
F LA
NDI
NG C
OST
S
ENVIRONMENT OF CONTINIOUS ECONOMIC GROWTH
Economic Growth• South African business expectations for growth in key
areas such as turnover, profitability, efficiencies and employment are higher than ever before. (Grant Thompson Consultants).
• The South African economy grew with 5% during 2006. This is only 0, 1% lower than 2005. Maria Fassler of JP Morgan Chase reports a continuous growth over the past 33 Quarters (8,25 years)
• According to the Road Freight Association approximately 1.2 billion ton cargo is moved per year (2002 statistics). If we apply the growth factor to cargo moved, per year 60 million ton more has to be moved.
SOURCE SASC - 2007
Total cargo traffic PMAESA ports
TOTAL PORT THROUGHPUT PMAESA MEMBER PORTS (DWT)
TOTAL TOTAL
COUNTRY REPRESENTED BY TONNAGE TONNAGE
2005 2006
BURUNDI PORT OF BUJUMBURA 204,929 184,063
DJIBOUTI PAID 5,434,948 5,480,415
ERITREA MTC MARITIME DEPT 571,915 635,461
KENYA KPA 13,280,747 14,402,018
MAURITIUS MPA 5,602,466 5,686,342
MOZAMBIQUE CFM 9,982,300 10,598,200
REUNION PORT REUNION 3,759,488 3,947,463
RWANDA MAGERWA 523,800 582,000
SEYCHELLES MTC PORT&MARINE DIV 755,055 755,560
SOUTH AFRICA NPA 173,555,069 179,983,594
TANZANIA TPA 6,285,060 6,330,404
TOTAL CARGO TRAFFIC 219,955,777 228,585,560
NOTE: * rep. Projected throughput
• Africa has transport corridor network of 2.06 million km, facilitating her 8.5% of the 7.11 billion tons of the global cargo traffic. This represent 0.61 billion tons, of which Road represent 96% and Rail - 4%
• PMAESA ports handled 0.23 billion tons representing 38.0% share of African traffic in the global market •(PMEASA 2007)
SA Exports of goods & services Constant 1995 prices.Seasonally adjusted at annual rate
Source – MEGA 2007 (DTI)
SA Imports of goods & services Constant 1995 prices.Seasonally adjusted at annual rate (Forecast)
Source – MEGA 2007 (DTI)
South Africa Goods Transported
• Nearly 7% of SA Gross National Product is spend on transport.
• 80%of all freight carried in South Africa is done by road.
• Transnet Freight Rail is handling approximately 14 to 16% and the balance by other means.
SOURCE SASC - 2007
Impact of Africa-Asia Trade to Seaport infrastructure and EconomyAfrican Ports& HARBOURS CONGRESS 2007
• The Expansion and Prosperity of the Asian market has become an integral part of many African economies
• Over 156 ships operate along the African-Asia trade routes per month
• Over 5,080 shipping calls from Asia to Africa serve 48 Sub-Saharan ports
Growth Rates of Asian
Imports by Origin
Source: IMF Direction of
Trade
PER
CEN
TAG
E
EU US Asia Africa Overall
4.7%
2.9%
7.9%7.6%
6.3%
Trend in Africa’s Exports to Asian Economies
1994 1996 1998 2000 2002 2004 2006
SOURCEAFRICA PORTS & HARBOURS NPA 2007
Trend in Africa’s Exports to Asian Economies
1994 1996 1998 2000 2002 2004 2006 2010
SOURCEAFRICA PORTS & HARBOURS NPA 2007
Demand & Capacity to 2010/11
@ 3.5% ann. growth @ 4.5% ann. growth
@ 7% ann. Bulk cargo growth Potential missed for Africa
Capacity without New Development Capacity with new Developments
30,5
45,5
60,5
75,5
90,5
105,5
120,5
135,5
06/07 07/08 08/09 09/10 10/11
TON
NA
GE
in M
illio
ns
Africa’s Bulk Cargo Capacity Projections
SOURCEAFRICA PORTS & HARBOURS NPA 2007
Total Africa-Asia: 2.342m(13.3%)al World: 69.925m
Figures above relating to year 2003
Africa-Asia Container TrafficAfrica-Asia is the second fast growing trade in terms export cargo volume. Westbound trade (Asia-Europe) exceeds eastbound trade (Europe-Asia)
Africa-AsiaCargo breakdown
Vehicles & Machinery 17%Computer/Electronic Goods 12%Textiles 8%Rubber & Plastics 8%Footwear & Clothing 6%White Goods 5%Food 4%Toys 3%Beverages 3%Others (Coal, Iron Ore) 24%
Asian imports from Africa mainly constitute raw materials such as coal, forest products, minerals & metals etc. On the westbound route from Asia to Africa the main cargoes are consumer products such as electronic goods and clothing etc.
SOURCEAFRICA PORTS & HARBOURS NPA 2007
INDUSTRY VIEW ON - SUPPLY CHAIN
Most Container Terminals are reaching capacity limits
Supply Chain General Challenges
• Yesterday’s foreign manufacturer in a far away country competes today in your own forecourt, typical CHINA.
• The South African supply chains are not limited to South Africa anymore.
• The future of the South African industry lies in the international arena.• This creates another dilemma. You are faced with an unknown field,
the challenges in the Global Supply Chain.• The challenge of Global Supply Chain Management refers to the
complex integration of processes necessary to manage materials from their point of origin through manufacturing and shipment to the final consumer or beyond in the case of recycling.
SOURCE SASC - 2007
Supply Chain Challenges (Cont.)• Global logistics is more difficult to manage than domestic logistics! • In the international arena the Supply Chain/Logistics Manager are very
much reliant on more role players and service providers. • Time and place become a major factor.• Knowledge of the supply chains is now essential, however
performance is crucial. • Assumptions made by managers may not be as reliable, situations are
less stable, the geography is much broader and monitoring logistics processes are more complex.
• A concern is the large number of trucks on our roads, whilst theobvious mode – Rail - is under utilized and ports are heavily congested What is the cause?
SOURCE SASC - 2007
Service Provider Performance
• In international logistics, there are many different participants: the buyer, the seller, the service providers and other intermediates.
• The Supplier and final customer are dependent on the performanceof all the service providers in the supply chain.
• The performance of one link may jeopardize the performance of the next. For an example, if a container is not delivered within the stack dates it will not be loaded and will have to wait for another opportunity.
• The performance of a major port will and shall jeopardize the performance of a country, typical to the congestion presently experienced in Durban
SOURCE SASC - 2007
Development and maintenance of infra-structure
What is needed to ensure an optimized smooth operating supply chain?• A supply chain is dependant on the availability of needs related infra-structure. • The continuous monitoring and establishment of needs are essential. In South
Africa this is mostly in the hands of Government. • Therefore the role of Government is now more important than ever before! • This is a two sided blade. Interaction between Government and the Industry is
crucial. • If Industry does not share its needs Government can not develop infra-structure. • Government must therefore create forums during which needs and requirements
can be shared. • The performance of channels should also be addressed, in a non-confrontational
manner, with the aim to seek optimal solutions; • through this we can meet a common goal: Wealth to the Nation, through
customer satisfaction.
SOURCE SASC - 2007
Sharing of information
• To ensure success, it is crucial that parties in the total supply chain share needs and requirements, Information is crucial.
• The development of collaborative supply chains are of the essence.
• Through web enabled systems all parties in the supply chain, inclusive of the most important partner, your customer, can keep track of the cargo.
• Through the availability of information corrective action can be taken.
• Public and private sector has to work together in corridor planning structures
SOURCE SASC - 2007
CHALLENGES FACED BY INDUSRY –ESPECIALY REGIONAL TRANSIT
CHALLENGES FACED BY INDUSTRY –ESPECIALY REGIONAL TRANSIT (1)
• Out dated regulations and practises by transport and custom Authorities.
• High costs and complexities of transit bonds • Lack of harmonised inter state transport
practises. • Slow progress in removal of non-physical
barriers and legal reform• In-efficient hinterland inter-modal transport
networks
CHALLENGES FACED BY INDUSTRY –ESPECIALY REGIONAL TRANSIT (2)
• Lack of Joint One Stop Border Posts• Slow implementation of aligned documentation
processes at border posts to facilitate easier movement of cargo – an African single documentation i.e. SAD500
• Slow removal of trade barrier; complexity of import duty tariff.
• Serious administration constraint in most ports is linked to Customs clearance procedure.
• Pre-shipment overseas inspections and other documentation process in our ports result in delayed shipment.
CHALLENGES FACED BY INDUSTRY –ESPECIALY REGIONAL TRANSIT (3)
• Insufficient proper hinterland transportation links in respect of road and rail connectivity
• Poor inter modal connections to be strengthened • Insufficient freight links between African
countries – Poor roads, limited poor rail links• Lack of synergies between the African countries• Capital and human resource limitations• Lack of institutional frameworks for corridor
management structures with sustainable funding
CHALLENGES FACED BY INDUSTRY –ESPECIALY REGIONAL TRANSIT (4)
• Very high African transportation costs within the supply chain to and from the hinterland
• Delays in handling of cargo due to poor efficiencies• Not sufficient excess capacity created ahead of demand • Not sufficient logistics hubs to facilitate IT, stuffing, de-
stuffing and warehousing of goods • Old terminals with old technologies that do not provide
high levels of efficiencies
CHALLENGES FACED BY INDUSTRY –ESPECIALY REGIONAL TRANSIT (5)
• Slow Constructing, expanding & equipping new modern cargo berths and facilities.
• Ports too shallow to accommodate larger vessels • Slow dredging and expanding of port entrance channels.• Modern Containerisation facilities & mode of transport.• Slow roll out of communication and information
technology in the water front systems.• Slow development of Cruise shipping facilities.• General port congestion which adds hugely to the cost of
transport and poor customer satisfaction levels
BACKLOG OF TRANSPORT INFRASTRUCTURE INVESTMENT AND
DEVELOPEMENT IN SOUTHERN AFRICA??
Except for sporadic investments, transport is only picking up slowly.Transport infrastructure investments in SSA with private sectorparticipation (total investments)
00.10.20.30.40.50.60.70.80.9
1
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
$ bi
llion
Airports Railroads Roads SeaportsSOURCE WORLDBANK
4Source: World Bank, PPI Project Database
Despite low WB commitments, port investments have been increasing lately, mostly funded outside of IBRD/IDA. This suggests sufficient commercial viability of port operations to attract private financing. This trend is likely to continue:
Need for additional capacity to accommodate the increasing export of natural resources (coal, minerals, oil, etc.)
Double-digit growth rates in numerous African countries are likely to spur imports
Port investments w ith private sector participation
010002000300040005000
2001 2002 2003 2004 2005
$ m
illio
n
World
SSA
SOURCE WORLDBANK
9
Importance of Maritime Transport• To facilitate international trade and promotion of global integration.
• According WTO, the world seaborne trade amounted to 7.11 billion tones of which:
9%
22%
38%
22%
9%
AfricaEuropeAsiaAmericaOceania
In the Global Market, 90% of the International Trade is seaborne.
SOURCE – PMEASA 2007
Status of Container Terminals in East & Southern Africa• The following table illustrate the rapid growth of container traffic from about 2.4m TEUs in 1997 to 4.0m TEUs in 2004, an average growth of about 10% per annum over the eight year period.
0
1,000,000
2,000,000
3,000,000
4,000,000
1997 1998 1999 2000 2001 2002 2003 2004
M ombasa, Dar-E s-S alaam & Djibouti S outh Africa M auritius & Reunion
SOURCE – PMEASA 2007
Congestion at Container TerminalsThe growth of container volumes has lead to saturation of facilities in many ports in the region.
• Durban has had a congestion surcharge imposed by shipping lines since 2 years
• Dar-Es-Salaam Yard saturation is affecting productivity.
• Mombasa is operating more than 100% above design capacity, and shipping lines normally threaten to impose a delay surcharge.
• Mauritius had experienced problems linked to explosion of transshipment traffic
• Djibouti is facing problems due to saturation of the terminal by transit containers affecting productivity
Response to congestion•Improve efficiency when possible;
• Develop additional capacity;
• Private sector participation has been a standard response to improve efficiency
SOURCE – PMEASA 2007
Port CongestionThe origin of port congestion is complex to identify and related to among others:
•The growth of container volumes has lead to saturation of facilities in many ports in the region•Clogged access way to the port and saturated inland connections,•Inadequate physical capacity and insufficient productivity,•Inadequate information technology systems,•Cumbersome and bureaucratic cargo clearing systems, •Shortage of adequate storage areas,•Inefficient inter-modal cargo flow/ network of rail & road transport,•Seasonal congestion – export commodities,•Administrative slow-downs and bottle-necks. SOURCE – PMEASA 2007
PORT OF MAPUTO TRANSIT CARGO
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
YEARS
THROUGH P UT TONNES
TOTAL TRANSIT TOTAL TRAFFIC
TOTAL TRANSIT 2,016,400 2,052,000 2,054,100 1,663,200 1,923,600 1,804,400 2,062,800 2,309,935 2,833,265 2,710,522
TOTAL TRAFFIC 3,109,000 3,016,400 3,101,600 3,035,900 4,001,600 4,423,600 5,036,000 5,554,036 6,381,722 6,608,655
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
PORT POTENTIAL 11 TO 20 MILLION TONS
MPDC – PORT OF MAPUTO
• Regional Corridors with alternative ports -Maputo and Walvis Bay in the neighboring countries creating much needed capacity
• and also stimulating regional integration and growth
ECONOMIC IMPACT OF THE CORRIDOR
• Joint Committees under RMGs– Operate as part of the RMGs – Bilateral road transport agreements
– One mode only– Perceived to be ineffective
• Maputo Development Corridor – Bilateral agreement: MZ & RSA – Promote interests of Economic Rehabilitation Program in MZ; &
Reconstruction & Development Program in RSA.– Integrated transport infra. development via PPPs in Witbank-Maputo
Corridor
• MCLI– Largely a Private Sector Initiative – Part of RSA/Mozambique/Swaziland Public Sector on Board– Is multimodal focused– Modal Work Groups merged into MFLF
THE HISTORY AND STRUCTURES OF THE MAPUTO CORRIDOR
DISTANCE IS COST –COMPARATIVE
DISTANCES – ROAD AND RAIL
MAPUTO CORRIDOR ALL THE POTENTIAL TO BE AN ECONOMIC
TRANSPORT CORRIDOR
OVERVIEW - reduce the cost of doing business – distance is cost
Major Infrastructure /Plant Investment Values
ContractSMME
ContractValueSAR
JobsPerm, TempCasual
PeopleTrained
N4 Toll Road US$ 250 MILR2 B spent-R3B next 25yrs
702 SAR 304 M 6220 20,260
Port of Maputo& Terminals
2007 investment plans
US$ 46 MILof US$ 70 MILUS$ 15 MIL
Further $273M
2,000 & indirect(1 job impacts 8 people)450–$1.755M PA1,800 indirect $4.680M PA
450 full time staff trained in ops & safety/sec
Rail US$ 12 MIL InitialCFM > 50 Locos $30mRolling Stock 970 wagons $30M
Energy US$ 100 Mil
Mozal US$ 2 BIL 200 USD 100 M 9,0001,000 perm
Temane Gas pipeline to SA SASOL 1,000KM
US$ 1 BIL$498M royalties & taxes over 25 yearsMORE THAN $3 BINTEST
3,000 during construction 1,000 Moz’s
$3M training budget
IMPACT OF MDC – TO DATE > $5B - INVESTMENTS
MAPUTOMAPUTO
Mature SDP Example: Mature SDP Example: The Maputo Development CorridorThe Maputo Development Corridor
Pande-Secunda Gas line. PPP Sasol completed
Coal-based Power Station2 transmission lines to
Matola completed
Liquid Fuels & Petro-chemicals: Sasol
Al smelter 500ktpaBHPB completed
Joburg-Maputo HighwayPPP- BOT completed
Port of Matola/MaputoUpgrades, PPP
Joburg to Maputo Railway line: Upgrade
GA
UTE
NG
GA
UTE
NG
MINTEK MINTEK ––NEPAD 2007NEPAD 2007
High Cu Magnetitedumps > 300 MT
Magnetite (>Cu)dump upgrading
plant
(Ti/V) MagnetiteSep. & conc. plant• magnetite• ilmenite
Rail
Slurry pipeline
Pande Gas Pipeline
Gas Connector
RailwayMajor RoadDuvhaPower LinesPande GasPipeline
MDC phase II: MDC phase II: Maputo Metallurgical ComplexMaputo Metallurgical Complex
Downstream chemicals& agriculture
Other Potential:Ilmenite smelter Ti/Fe
Fertiliser plant N/PChlor-alkali plant Na/Cl
Fe pelletising plant
DownstreamManufacturing
MMC:MMC:Iron (DRI) &Iron (DRI) &Steel PlantSteel Plant
Fe exports
Elec transmission
Possible Ti/Fe From Chibuto
MINTEK MINTEK ––NEPAD 2007NEPAD 2007
• 1997 a 30 year concession granted to TRAC – “Double” PPP (Two governments involved)– PPP’s used to contribute to infrastructure using private
funding and to relieve the burden on tax-based revenues.
• TRAC has obligations to:– Finance– Design– Construct– Maintain STATUS– Road from Ressano Garcia border to Maputo is new.
Traveling time greatly reduced.– TRAC obliged to continuously maintain the road.– Spent R2 Billion on the road to date – Planned to spend at least another
R3 Billion over next 25years• Continuous adding of lanes & resurfacing
• The project has been successful in all aspects, namely :
• As a constructed road• Involvement in Social Development in both RSA
and Mozambique• In stimulating and being a catalyst for economic
development• Volume increase of 5-7% p.a. - freight – 10%
REHABILITATION OF INFRASTRUCTUREN4 -ROAD
• BORDER POST LEBOMBO/RESSANO GARCIAROAD TRAFFIC ON MAPUTO CORRIDOR ON N4 - PASSENGERSEaster 2007 > Easter 2005 +130% = 166K to 382K December 2006 > 466K December 2006 =330K to 466K113,500 on the 23rd of December 2006 (56,K previous record). Home Affairs - 80% increase in passengers since April 2005 when visas were abolishedAll this via the N4 ! - 23 December 06 (from highest to lowest): Middleburg Toll Plaza - 30 389 - Nkomazi Toll Plaza – 14 717
ROAD TRAFFIC ON MAPUTO CORRIDOR ON N4 - FREIGHT• 1 September 2006– commercial cargo clearing hours extended to 22:00almost zero to 6-700K tonne pa since mid-2002. The traffic is largely SA exports.•13 August 2007 – hours extended to midnight (18hours)24hr border opening is essential in order to enable road transport to complete the round-trip between JHB-Maputo within 24hrs.
LEBOMBO RESANNO GARCIA JOINT ONE STOP BORDER•28 June 2006 - bi-lateral meeting between the Presidents of SA and Mozambique – announced commitment for “one-stop-border”•DFID works with SARS & MOZRS – SA – BCOCC
•R600Million Rand•23 May 2007 – MCLI AGM – Joint presentation of SA & Mozambique Revenue Services 3 Location One stop border post – Completed 2009
•Commercial cargo clearing – Mozambique KM4•Passenger clearing – re-build -current border post•Rail
•18 September 2007 – Economic bi-lateral signed & confirmed•Construction to start Feb 2008 – completed 2009!
•2006 - , 1.7m tonne transit cargo from SA, ie. 4.5-5 trains per 24 hrs •line has design capacity for 9m tpa, ie. 16-18 trains per 24hrs.•CFM upgrade programme on the Moz section of the line (92kms from the border to the port) •20 tonne axle loads and throughput of approx 13m tonne pa (2010-11). Now excellent cooperation between CFM and Spoornet • Rehabilitation to be completed Dec 2007CFM rebuilds rolling stock ahead of growing demand for railway transportfrom the region to the port of Maputo.•150 wagons rehabilitated in-house•820 will be rebuilt by a specialized foreign contractor to be selected through a public tender - US$ 30 M.•Rehabilitate more than fifty locomotives US$ 30 M
RAIL ON THE MAPUTO CORRIDOR
www.portmaputo.comwww.portmaputo.com
NEARESTNEARESTPORTPORTTOTOSOUTH ASIA
SOUTH ASIA&&CHINACHINA
PORT OF MAPUTO TRANSIT CARGO
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
YEARS
THROUGH P UT TONNES
TOTAL TRANSIT TOTAL TRAFFIC
TOTAL TRANSIT 2,016,400 2,052,000 2,054,100 1,663,200 1,923,600 1,804,400 2,062,800 2,309,935 2,833,265 2,710,522
TOTAL TRAFFIC 3,109,000 3,016,400 3,101,600 3,035,900 4,001,600 4,423,600 5,036,000 5,554,036 6,381,722 6,608,655
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
PORT POTENTIAL 11 TO 20 MILLION TONS
MPDC – PORT OF MAPUTO
MAPUTO PORT CONCESSIONAIRE – INVESTED $50 OF $70MSTRATEGY FOR MAPUTO
& DOBELA PORT
12 MAJOR PORT DEVELOPMENT PROJECTS -$273MILLION
1. EXPANSION OF COAL/MAGNETITE TERMINAL
2. BUILD NEW CAR TERMINAL3. NEW FRESH PRODUCE
WAREHOUSE4. TRANSIT SHED T2 (BAGGED RICE
AND STEEL)5. TRANSIT SHED T3 (MULTI-
PURPOSE BULK TERMINAL)6. TRANSIT SHED T4 (FERTILIZER
TERMINAL)7. BULK LIQUIDS TERMINAL8. GRANITE TERMINAL9. EXTENTION OF THE MPT CITRUS
TERMINAL10. EXTENTION OF THE STAM BULK
SUGAR TERMINAL 11. UPGRADE AND IMPROVE
MAPUTO PORT ACCESS TO POST PANAMAX PLUS TYPE OF VESSELS
12. EXPANSION OF CONTAINER TERMINAL
BUILD NEW CRUDE OIL TERMINAL AT PONTA DOBELABUILD NEW OIL PIPE LINE DOBELA TO MATOLA REFINERYBUILD NEW IRON ORE AND HEAVY SANDS TERMINAL
ECONOMIC IMPACT
•11,45m TONS ADDITIONAL RAIL FREIGHT
•56,700 ADDITIONAL ROAD TRIPS PA
•$9.4M ADDITIONAL LIGHT DUES PA
•$10M RECLAIMED PORT LAND
•$11M ADDITIONAL VARIABLE CONCESSION FEE TO STATE PA
•450 NEW PORT JOBS – $1.755M PA
•1,800 INDIRECT JOBS - $4.680M PA
ALL AFFECTED BY MANDATED INSPECTION FEE
• MCLI was incorporated as a SECT. 21, (not for profit) organisation, during March 2004 as a membership organization, with members drawn from freight logistics stakeholders of both South Africa, Mozambique and Swaziland, focused on the promotion and further development of the Maputo Corridor, as a contribution to the aims and objectives of the SDI - Maputo Development Corridor – launched in 1996 – 110 Members
• MCLI promotes greater utilization of the Corridor by current and future investors and users to ensure that the remaining constraints are resolved and the Maputo Corridor becomes
“the first choice for the Corridor region’s stakeholders”
Freight Logistics creates an enabling environment for trade and investment! SA, Mozambique and Swaziland Ministries of transport
joining the board of MCLI
The formation & structure of MCLIMCLI – a multilateral; multi-stakeholder institutional framework to
integrate; coordinate; communicate and facilitate on the Maputo Corridor
APPROACH TO TRANSPORT LOGISTICS
IN SADC
1. APPROACH TO TRANSPORT LOGISTICS IN SADC
• Corridors the main basis for transportlogistics in SADC
• Corridor infrastructure development central toattainment of regional objectives (e.g. LobitoCorridor / Nacala Corridor Initiatives)
• Transport and trade facilitation, focusing on quicktransit and cross border movement facilitation
• Harmonisation of transport instruments (e.g roaduser charges, third party insurance, vehicledimensions etc.)
• Institutional capacity and other policy reforms.• Harmonised infrastructure programmes approach (SADC, COMESA, as well as EAC.
3. THE SADC EXPERIENCE IN CORRIDOR TRADE FACILITATION
• The Walvis Bay into Trans Kalahari Corridor andTrans Caprivi
• The Maputo Corridor (with strong private sectorparticipation)
• The Beira Corridor (with the Sena Line concession)• The Beitbridge Corridor (North-South Corridor)• The Dar es Salaam Corridor• World Bank SSATP Corridor Programmes• A coordinated approach to Transport and
Trade Facilitation is necessary for successful logistics• Infrastructure impact between 15% and customs 85%• SSATP/SADC Best Practice Study on Corridor
Trade Facilitation
3A. REGIONAL CUSTOMS BOND GUARANTEE SCHEMES AND ONE STOP BORDER POSTS
• SADC working on its Customs Bond Guarantee Scheme,premised on reduction of the cost of raising individualtransit guarantee in each Member State, elimination ofdelays and other inconveniencies
• COMESA Regional Bond Guarantee Scheme launched inKampala, Uganda on 22 September, 2006
• East African Community would apply the COMESAregime on its corridors
• SADC, COMESA and EAC running trials on One StopBorder Posts (OSBPs).
• The SSATP Project set up observatories to monitor effectiveness of transit movement along designatedcorridors.
What Are the Policy Opportunities From Our Competitors Practices?
4. PROPOSED WAY FORWARD• Setting up corridor performance benchmarks(SARA, FESARTA, Corridor Management Gps,
etc)Infrastructure development initiative (eg Lobito)
• Harmonised instruments (e.g. bond guaranteeschemes, documentation and customs systems
• Adoption of a holistic regional integration / tradefacilitation programme
• SADC Regional Infrastructure DevelopmentMaster plan (minimal to support FTA, CU and CM
• Master Plan to talk to the COMESA T&C Strategy• Best practice study by SADC to optimise all
experiences in the region and beyond
4B. PROPOSED WAY FORWARD
• Harmonisation of all trade facilitation programmes• Harmonisation of infrastructure, trade and
customs programmes at the level ofCOMESA/SADC AND EAC
• Advance customs clearance arrangements(requires trust and consistency)
• Political will an essentialia to change mindset andintroduction of new instruments and legislation
• Use multiple membership as opportunity forreplication of neighbourhood RECs initiatives
5. SOME KEY CRITICAL SUCCESS FACTORS
• There is need for balancing of simplification ofclearance procedures and revenue collection
• Broad based but streamlined stakeholderParticipation with state commitment
• Public private partnerships are key• Lay emphasis on user interests as business and
revenue generators, i.e., business driven• Focus on total seamless approach (ports,
overland transport, borders and inland clearanceFocus on Corridor Infrastructure Development and Regional Connectivity in SADC (Angola,Congo are therefore central to this initiative)
6. CONCLUSIONS
• Efficient logistics and trade facilitation initiativeswill be key drivers to our global competitivenessand wealth creation
• There is need for proper coordination of thisinitiatives at the level of RECs, but clearly, on theground stakeholders should be the day to dayDrivers, SADC role is facilitatory only.
• Proper sustainable structures required to drivethe process (reason for success of WalvisBay/Maputo and TTCI Corridor in Mombasa)
• As SADC we wish to play our role and cooperatewith other RECs / agencies in promoting logistics
CONCLUSION = OPPORTUNITIES TO REDUCE COST AND INCREASE GLOBAL COMPETITIVENESS
IMPROVE TRANSIT TRANSPORT& REGIONAL COOPERATION• Removal of out dated regulations and practises by transport and custom Authorities.• Simplify Transit bonds • Harmonised inter state transport practises. • Removal of various barriers.• Hinterland efficient inter-modal transport network.• Joint One Stop Border Posts• Aligned documentation processes at border posts to facilitate easier movement of cargo – an African single documentation i.e. SAD500• Proper hinterland transportation links in respect of road and rail connectivity • Inter modal connections to be strengthened • Proper freight links between African countries • Greater synergies between the African countries• Reduction in transportation costs within the supply chain to and from the hinterland • Reduction of delays in handling of cargo • increase in efficiency levels • Excess capacity to be created ahead of demand • Logistics hubs to be created to facilitate IT, stuffing, de-stuffing and warehousing of goods • Modern terminals with latest technologies that will provide high levels of efficiencies • Constructing, expanding & equipping new modern cargo berths and facilities. • Deeper ports to accommodate larger vessels • Dredging and expanding of port entrance channels. • Modern Containerisation facilities & mode of transport.• Developing Post Panamax Shipping facilities.• Communication and Information Technology in the water front systems.• Development of Cruise shipping facilities.• Highly Skilled labour • Funded Corridor Institutional frameworks
REGIONAL TRANSIT CORRIDOR AGREEMENTSALMATY PROGRAMME OF ACTION REVIEW
1. Infrastructure2. Capacity, people & other – ahead of demand3. Legal Instruments 4. Customs procedures & documentation – Revised Kyoto 5. Freedom of transit goods – GATT art. V – 1994 + WTO6. Guarantee system - TIR7. Physical security – WCO framework of standards8. Liability of transport operators–CMR (road) COTIF (rail)9. Information Technology – ITC – ASYCUDA & EDI10. Corridor management structures –
best practice such as MCLI &WBCG
EXTRACTS FROM:• PMAESA• SADC• AFRICA PORTS & HARBOURS – NPA• MEGA/DTI• MCLI• SOUTH AFRICAN SHIPPERS COUNCIL• MINTEK - SA
