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A need for a rapid upgrade of African ports, by Chofor Che

23 Sep

The issue of over congestion at African ports is a serious concern. The World Bank concurs that Sub-Saharan Africa has a serious infrastructure deficit estimated at about $48 billion a year which is hindering the continent’s competitiveness and hence its economic growth. With the exception of Durban, the cargo dwell time (the amount of time cargo spends at ports) averages about 20 days in African ports, compared with 3 to 4 days in most other international ports. None of the past attempts to solve this problem have worked.

In 2013 I was invited by the Cameroon Chamber of Commerce to participate in a special edition of ‘La Chambre’, a journal published by this institution. Amongst the salient issues addressed in this 15th edition of January, February and March 2013, was the dilemma of congestion at the port of Douala. I argued in my piece that a major reason for such delays is that certain public and private actors in the system benefit from such delays. Importers use the ports to store their goods. Customs brokers have little incentive to move the goods because they can pass on the costs of delay to the importers. And when the domestic market is a monopoly, the downstream producer has an incentive to keep the cargo dwell times long as a way of deterring entry of other producers. Another hurdle I identified was that at the Douala port for instance, fiscal pressure seems to play a role in cargo dwell time. The correlation tends to be positive: higher fiscal pressure leads to higher dwell time, with a noticeable exception of duty free items that have a relatively long average dwell time despite the absence of duties. This could be linked to bargaining time between the customs broker and customs agent, a misclassification, a duty free line, or simply the time to furnish additional documents. The net result is inordinately long dwell times, ineffective interventions, and globally uncompetitive industries in African countries. It seems the arguments I advanced in my article fell on deaf ears because as I write this piece, the problem of congestion at the port of Douala as well as several other ports on the continent has become chronic.

In an op-ed by a Kenyan link, Daily Nation, dated the 26 August 2014, Mr. Danson Mungatana, Kenya Ports Authority chairman calls on African countries to expand their ports. In this op-ed according to Mr. Mungatana, it is important for African countries to expand their ports so that they can benefit from the global maritime trade, which is increasingly turning to larger ships. He added that bigger berths are needed to handle the bigger ships being built. He equally calls for the utilization of up to date technology and equipment to benefit from the increased maritime trade. According to Mr. Mungatana “The steady increase in ship sizes, coupled with growing cargo volumes, has put pressure on cargo infrastructure and terminal capacities the world over, in particular for African ports, which have capacity constraints and poor transport infrastructure.”

Indeed the issue of congestion at ports in Africa stifles economic development. African states need to rethink their strategy on managing ports on the continent. The solution to decrease dwell time in these ports relies mainly on the challenging task of breaking the monopoly by state actors as well as some private actors. There is need for collaboration and understanding between public authorities, logistics operators, and some shippers rather than just investing massively in infrastructure which of course is important. Addressing the challenge will also necessitate that there be support from the general public for reforms that will promote their interests. Before they offer their support, the public needs to be informed of the stakes and challenges especially as they are the most affected by this congestion. If such measures are taken into consideration by African states, then we may find a solution to the alarming scenario of congestion at our ports.

This article is originally written in French and published at LibreAfrique.org. as ‘Urgente nécessité de mise à niveau des ports africains’http://libreafrique.org/ChoforChe-port-010914 on the 1 September 2014.

 
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Posted by on September 23, 2014 in Africa Development

 

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