Transporting goods across Africa can be challenging, and without the necessary experience, logistics companies could face some serious delays. How we made it in Africa spoke to Greg Tighe, Concargo’s Director: Global Projects – Worldwide Operations, about dealing with these difficulties and the rising demand for goods to be transported from South Africa into the rest of the continent.
Cargo volumes can be used as a measurement of economic activity. Has Concargo seen a rise in the demand for its over-border services into the rest of Africa?
Africa is certainly growing in terms of cargo movements. Our over-border traffic into the SADC region is showing significant growth month-on-month, both consolidation as well as full truckloads.
The rise in the copper price has really boosted the Zambian trade resulting in increased demand for transport and logistics services into and out of the country. China is a major investor in the infrastructural development of Zambia as well as one of the largest buyers of the country’s minerals resources. We are currently transporting a wide range of commodities and equipment to Lusaka and the Copper Belt.
Demand is emanating from all the countries where we see major infrastructural developments taking place. Angola is another route where we’ve seen a dramatic increase in volume. Activities into the DRC are also on the up again; there is a lot of equipment moving to the mines in the southern DRC.
Most of these countries are solely dependent on the importation of raw materials, equipment and technical support to facilitate their developmental needs. Most of these goods are from South Africa or are routed through South African and Namibian ports.
What are the major challenges associated with transporting goods into the rest of Africa?
The poor condition of the roads that one has to travel on as well as the distances between the South African ports and suppliers in some of the northerly destinations is quite challenging to both transport equipment and drivers.
Clearing the border posts can be a logistical nightmare for inexperienced service providers embarking on these routes for the first time. Many of the border posts have poor facilities and officials often lack the necessary skills required to offer an efficient service. Corruption often presents its own set of challenges to the truck drivers who ply these routes.
We have been providing transport services into the SADC region for the past twenty years now and have fortunately paid our school fees. Anyone new at the game is going to face some serious challenges and delays. Things are never always plain sailing, but we have learnt over the years where to be proactive and what to look out for as well as what is ultimately required in order to expedite cargo through the borders with as little delay and as efficiently as possible.
There is currently a lot of talk about Africa’s improving business environment. Have you seen an improvement in the quality of roads, customs clearance times, etc?
We have seen a lot of the previous negative perceptions of doing business in Africa disappear.
Political reforms in a lot of the African countries have led to an improving environment that has become conducive to doing business, and is beginning to attract foreign investment into the upgrading of roads and infrastructure. Customs clearance into the BLNS countries is conducted efficiently, however, we are still waiting to see improvements from our more northerly neighbours.
The DRC remains a very challenging destination to deliver to with poor facilities at the Kasumbulesa border and lots of corruption. If you don’t have your ducks in a row, you can have your truck detained at the border post for weeks. The border crossing from Namibia into Angola is probably on par with that of the DRC.
Why are transport costs in Africa among the highest in the world?
Some of the factors contributing to the high costs of transporting into Southern Africa are the distances, condition of the roads, border fees and the cost and availability of fuel. The maintenance costs on your truck tractors and trailer equipment is generally a lot higher as a result of the hammering that they take due to the bad roads.
One has to always have contingencies in place for the unforeseen. If your truck breaks down you need to have mechanical back up in place, often having to have spares sent up from South Africa. It is not as simple as calling out your local truck dealer’s emergency break down team as we can do here in South Africa. If you breakdown in the middle of Angola, you’re pretty much on your own. So you need to provide the means of retrieving your trucks, or getting workshop mechanics up there.
A lack of return load cargo from some of the countries is also a factor accounting for higher transport costs. The empty return leg must unfortunately be factored into the price of moving the load from A to B. Angola is a prime example of the one way traffic situation.