Statistics indicate that 90% of imports and exports in Africa are driven by sea. With a global middle class set to reach five billion people by 2030, global trade is set to continue to grow at an unprecedented rate. Reports suggest that global freighter fleet is expected to double over the next decade due to the growing consumption demands of the ever-increasing middle class.
Gilbert Saggia, MD: East Africa, SAP Africa
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Beyond fulfilling their respective countries’ trade needs, ports act as gateways to landlocked countries such as Ethiopia and Chad, that have significant agrarian and raw materials export potential, and a great need for imports of finished and processed goods from the East and West. Without these gateways, landlocked countries that have much to offer in world trade are figuratively closed for shop.
If Africa is to play a meaningful role in world trade and benefit from the rapid global growth, its seaports will be key to ensuring that success. However, African ports face the primary challenges of under-developed infrastructure and inefficient operations, leading to significant losses in potential revenue.
According to PWC, of the 72% of world container throughput commanded by developing countries, Africa collectively only sees 1%. A hypothetical improvement from 1% to 3% would increase the economic value of trade by sea by a magnitude equivalent to the GDP of certain African countries.
There is clearly a need to drive improved performance at African ports if we are to take advantage of the economic promise that the future holds.