Africa needs to benefit from the economic potential of its ports and shipping sector, in order to achieve its growth ambitions. Ports are gateways for 80% of merchandise trade by volume and 70% by value, and therefore they are vital in emerging economies that are currently under-served by modern transportation facilities.
Port performance has a direct impact on the efficiency and reliability of the entire transport network in which the port is just a node for the transfer of goods.
These are the key findings of an analysis of port development in sub-Saharan Africa (SSA) issued by PwC. The report, “Strengthening Africa’s gateways to trade”, addresses challenges in SAA’s ports in attracting external investment and highlights the regional economic and growth benefits thereof.
SSA must enhance its market access and trade across the region and with the rest of the world. PwC notes that a 25% improvement in port performance could increase GDP by 2%, showing the close relationship between port effectiveness and trade competitiveness. Access to effective ports, and efficient operations will produce reduced costs and improved overall freight logistics efficiency and reliability.
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Despite the high volumes of goods that require transport, the development of ports in Africa’s wider logistic chains remains problematic. Some ports generate benefit, while others have stayed behind.
PwC using the Port Performance Analysis (PPA) tool, concluded to the following about SSA ports:
- There is a lag in investment in port infrastructure, which tends to obstruct African ports.
- African ports tend to operate at higher densities than their global counterparts due to land constraints.
- Terminal capacity utilisation is often constrained by vessel sizes, vessel utilisation and call frequency.
- Road network around ports are often not sufficient to sustain port volumes.
However, handling inefficiencies and long container dwell times are caused by poor port management, customs and associated container clearing processes, as well as improper landside connections.
The following are the future trends for African ports:
- Ownership and service models are gravitating towards greater private-sector involvement;
- Increasing competition between ports is driving investment decisions;
- Shipping lines and port operators are increasingly driving port investment;
- Externally-funded commodities and consumer goods are driving investment;
- Appetite for large greenfield investment is waning;
- Focus on intermodal facilities and dry ports is increasing;
- Greater awareness of infrastructure interdependencies.
You can see the full report in the PDF herebelow
