FREIGHT & TRADING WEEKLY FOR IMPORT / EXPORT DECISION-MAKERS FRIDAY 26 June 2015 NO. 2156 Last week saw the roll-out of a new branding and a new slogan for independent groupage operator CFR Freight. ‘Shifting Your World’ is the new company mantra, and it’s a lot more than a mission statement, says CEO Peter Schmidt-Löffler. “It’s about reinforcing and growing our culture of partnership and value-add. We don’t only move cargo. We believe we also move businesses and people’s lives forward and this mantra Mini feature – West Africa PAGE 8 FTW3197SD FTW3026SD Adele Mackenzie South Africa faces another major hurdle to its unrestricted inclusion in the United States African Growth and Opportunity Act – the finalisation of health certificates for beef and pork imports to resume from the US. Dave Wolpert, CEO of the Association of Meat Importers and Exporters (AMIE), told FTW that the “Paris negotiations” – during which the infamous chicken imports war was settled – between the minister of trade and industry Dr Rob Davies and the US trade representative Michael Froman, - included an agreement that the beef and pork import market would be opened to the US again and that the process would be fast- tracked. “However, this may take a bit of time as the veterinary clearance certificates still need to be obtained,” said Wolpert The Mail & Guardian (M&G) newspaper cited chief director of inspection services for the department of agriculture, forestry and fisheries (Daff), Mooketsa Ramasodi, as saying that the diseases presented in the US beef and pork products had not been “inactivated”. Of particular concern to Daff is the porcine reproductive and respiratory syndrome (PRRS) which Ramasodi reportedly said had not been satisfactorily addressed by the US. According to him, most countries had made an effort to comply with SA’s PRRS regulation but the US had simply sent a list of products they wanted SA to consider. “Only a handful of those were considered safe by our standards,” he told M&G Information found on the South African Pork Producers’ Organisation (Sapo) website notes that South Africa is one of the few global producers that has not been touched by the virus. According to Sapo, an outbreak would mean a loss of around R750 to R1 000 per breeding female a year. Obtaining a health certificate for beef exports could be easier as the US received a ‘negligible risk’ of spongiform encephalopathy (commonly referred to as ‘mad Meatier obstacles to SA’s Agoa inclusion cow’ disease) in May 2013. According to Ramasodi, SA already imports beef from other negligible risk countries. Addressing parliament in Cape Town last week, Davies noted that South Africa and the US were working on the outstanding import issues around plant and animal health and that stakeholders would meet in the US by the end of this month to find some common ground. US ambassador, Patrick Gaspard, recently issued a statement to refute allegations that the US was holding SA hostage on its inclusion in the Agoa renewal, commenting: “The US has made clear our consistent position that we want Agoa seamlessly renewed, and that we want South Africa included. Both the administration and Congress, however, have also made it clear that we want to resolve outstanding issues blocking US trade, most notably on several agricultural products.” The US has made it clear that we want to resolve outstanding issues blocking US trade. – Patrick Gaspard “ New shift… To page 24 CFR Group’s management team from the left: Willie Nel, Martin Keck, Peter Schmidt-Löffler and Anthony Martindale. Photo: Shannon Van Zyl
Transcript
FREIGHT & TRADING WEEKLY
For import / export decision-makers FRIDAY 26 June 2015 NO. 2156
Last week saw the roll-out of a new branding and a new slogan for independent groupage operator CFR Freight.
‘Shifting Your World’ is the new company mantra, and it’s a lot more than a mission statement, says CEO Peter Schmidt-Löffler. “It’s about reinforcing and growing our culture of partnership and value-add. We don’t only move cargo. We believe we also move businesses and people’s lives forward and this mantra
Mini feature –West Africa
page 8FTW3197SD
FTW3026SD
Adele Mackenzie
South Africa faces another major hurdle to its unrestricted inclusion in the United States African Growth and Opportunity Act – the finalisation of health certificates for beef and pork imports to resume from the US.
Dave Wolpert, CEO of the Association of Meat Importers and Exporters (AMIE), told FTW that the “Paris negotiations” – during which the infamous chicken imports war was settled – between the minister of trade and industry Dr Rob Davies and the US trade representative Michael Froman, - included an agreement that the beef and pork import market would be opened to the US again and
that the process would be fast-tracked.
“However, this may take a bit of time as the veterinary clearance certificates still need to be obtained,” said Wolpert
The Mail & Guardian (M&G) newspaper cited chief director of inspection services for the department of agriculture, forestry and fisheries (Daff), Mooketsa Ramasodi, as saying that the diseases presented in the US beef and pork products had not been “inactivated”.
Of particular concern to Daff is the porcine reproductive and respiratory syndrome (PRRS) which Ramasodi reportedly said had not been satisfactorily addressed by the US. According to him, most countries had made an effort to comply with SA’s PRRS regulation but the US had simply sent a list of products they wanted SA to consider. “Only a handful of those were considered safe by our standards,” he told M&G
Information found on the
South African Pork Producers’ Organisation (Sapo) website notes that South Africa is one of the few global producers that has not been touched by the virus. According to Sapo, an outbreak would mean a loss of around R750 to R1 000 per breeding female a year.
Obtaining a health certificate for beef exports could be easier as the US received a ‘negligible risk’ of spongiform encephalopathy (commonly referred to as ‘mad
Meatier obstacles to SA’s Agoa inclusion
cow’ disease) in May 2013. According to Ramasodi, SA already imports beef from other negligible risk countries.
Addressing parliament in Cape Town last week, Davies noted that South Africa and the US were working on the outstanding import issues around plant and animal health and that stakeholders would meet in the US by the end of this month to find some common ground.
US ambassador, Patrick Gaspard, recently issued a statement to refute allegations that the US was holding SA hostage on its inclusion in the Agoa renewal, commenting: “The US has made clear our consistent position that we want Agoa seamlessly renewed, and that we want South Africa included. Both the administration and Congress, however, have also made it clear that we want to resolve outstanding issues blocking US trade, most notably on several agricultural products.”
The US has made it clear that we want to resolve outstanding issues blocking US trade.– Patrick Gaspard
“New shift…
To page 24CFR Group’s management team from the left: Willie Nel, Martin Keck, Peter Schmidt-Löffler and Anthony Martindale. Photo: Shannon Van Zyl
2 | FRIDAY June 26 2015
DUTY CALLS
These statements have been edited because of space constraints. For the full versions go to ftwonline.co.za. Note: This is a non-comprehensive statement of the law. No liability can be accepted for errors and omissions.
Schedule - General NoteOn 15 June 2015 the South African Revenue Service (Sars) published the proposed amendment of General Note B 4 (Duty Assessment) to Schedule No 1 to the Customs and Excise Act, 1964 for which comment is due by 30 June 2015.
The proposed amendment is to provide for the calculation of the duty on goods with a statistical unit of “u” (number of units) to be based on full units only and not proportionately.
Wheat Tariff IncreaseSars on 19 June 2015 published the increase in rates of customs duty, excluding the Southern African Development Community (SADC), for wheat and wheaten flour, classifiable in Tariff Chapters 10 (cereals) and 11 (milling products).
Rule Amendment (DAR/155)On 19 June 2015 Sars announced the substitution
of Excise Accounts DA260 for Other Fermented Beverages (OFBs) for SOS (Spesiale/Special Opslag/Storage); OS (Opslag/Storage) and SVM (Spesiale/Special Vervaardiging/Manufacturing) warehouses, effective from 14:59 on 25 February 2015.
Self-Adhesive Tape ApplicationThe International Trade Administration Commission of South Africa (Itac) on 19 June 2015 published a tariff application for the proposed review of Rebate Item 307.01/3920.20/01.06 for the rebate of the customs duty on plates, sheets, film, foil and strip of polymers of propylene, biaxially oriented, for the manufacture of self-adhesive tape of tariff subheading 3919.10.
Comment is due by 31 July 2015.
Furnishing Article ApplicationOn 19 June 2015 Itac published a tariff application
for the creation of a Rebate Item for knitted pile fabrics, other, of 100% polyester fibres, classifiable under tariff subheading 6001.92 for use in the manufacture of other furnishing articles classifiable in tariff subheading 6304.91.90 under Rebate Item 311.42 for home textiles.
Comment is due by 17 July 2015.
Electric Vehicle TariffItac on 19 June 2015 published a tariff application for the reduction in the ‘General’ rate of customs duty on diesel, petrol and electric passenger vehicles not exceeding 800kg; diesel goods vehicles not exceeding 1 100kg and petrol and electric goods vehicles exceeding 800kg, from 25% ad valorem to free of customs duty.
Comment is due by 17 July 2015.
Possible anti-dumping terminationsOn 19 June 2015 Itac announced the possible termination of anti-dumping
duties unless the Sacu industry is able to substantiate that their removal will result in the recurrence of dumping. The products are blankets, People’s Republic of China (China); (ii) Blankets, Turkey; (iii) bolts and nuts of iron or steel, China; (iv) Polyethylene Terephthalate (PET), Chinese Taipeiv (Taiwan); (v) PET, India; (vi) PET, Republic of Korea (South Korea); and (vii) Unframed glass mirrors, India.
Rebate Item GuidelinesItac on 19 June 2015 announced the publication of a number of Rebate Item application Guidelines. More detailed information available in this week’s Customs Buzz.
In a first of its kind at South African ports the Cape Town Container Terminal will provide a pre-trip inspection (PTI) site for containers before the end of the year.
According to the Pam Yoyo, terminal manager at the Port of Cape Town, the construction of the site is expected to start soon. While there’s no firm date for this, Yoyo is determined to see the facility up and running before the end of the year.
“It is one of our main objectives for 2015,” she told FTW. “This facility has to work from the get go. There is no time to entertain teething problems and so we
are working hard to ensure that all is in place and that once construction of the facility is completed we can immediately start offering this service.”
No other port in the country offers a PTI service. Container users have to make use of facilities elsewhere be it at warehouses or depots. “We just think it will be more cost efficient in the long run having such a facility at the port. It will mean our customers can cut down on the movement of containers as they will no longer be moving from pillar to post to get them cleared for the next trip.”
Reefers in particular are subject to stringent international standards
– and with Cape Town predominantly servicing the perishable industry it made sense to look at this value-add service.
Yoyo said the terminal would do the inspection at a facility on site from where containers could be collected. “Our capex for this project has been approved and all of the necessary impact and feasibility studies have been concluded. We are now nearing the end of the procurement phase and so the start of construction is just around the corner.”
According to Yoyo this initiative will play a role in attracting more volume to the port as it will give the terminal an advantage.
CTCT pioneers pre-trip inspection facility
Cape Town Container Terminal will shortly begin construction of a pre-trip inspection (PTI) site for containers.
Industry is raising some serious questions over claims that some 69% of trucks have failed random roadworthy tests over a period of five years.
Several experts told FTW that while it was commendable that attempts were being made to determine the status of vehicles it was hardly scientific in its approach.
Patrick O’Leary, editor and publisher of Fleetwatch, has on several occasions raised concern around the roadworthiness of vehicles. He says a programme randomly testing trucks over the past five years is still showing a 69% failure of vehicles.
And, he says, he knows the industry doesn’t agree. “People in this industry argue and say these figures are wrong, but the fact remains 560 trucks have been tested and more than 300 of those failed the roadworthiness test.”
Kevin Martin, CEO of Freightliner Transport and former chairman of the Durban Harbour Carriers’ Association, says while O’Leary and his work for the
industry is commendable the wrong impression is being created.
“I fully agree that the condition of the nation’s fleets leaves a lot to be desired and contributes to the unacceptably high truck accident rate, but a rate of 69% failure on trucks tested does not mean that 69% of all trucks are un-roadworthy and dangerous,” he told FTW. “Logic tells me that if this was the case then either our accident rate would be 69% of all trucks running or our drivers are exceptional to be driving these trucks without any brakes or lights. We know neither scenario is true.”
Martin, like several other industry stalwarts, maintains that while there are many trucks on the road that should not be there the majority of operators are legal and run roadworthy fleets.
“The main weapon we can use to rectify this unacceptable situation is consignee/consignor legislation,” he said, but is in agreement that these new laws have to be corrected before they will even begin to impact on the industry.”– Liesl Venter
Unroadworthy truck claims challenged
Sugar imports into Nigeria are due to decrease following the opening of what is known as a Sugarcane Bio-factory at the Ahmadu Bello University in Zaria, Kaduna state northern Nigeria.
The facility will produce disease-free crop seedlings to support Nigeria’s Sugar Master Plan.
Sugarcane is seen as a strategic crop with high value addition because ethanol, electricity and animal feed can be produced from it.
In the first phase of the project Nigerian sugar cane production is set to increase to 1.6 million tons. – Ed Richardson
Sweet investment for Nigeria
4 | FRIDAY June 26 2015
JOHANNESBURG DURBAN CAPE TOWN PORT ELIZABETH EAST LONDON PRETORIA WALVIS BAY
MEDITERRANEAN SHIPPING COMPANY SA THE DEPENDABLE INDEPENDENT GENEVA SWITZERLAND
Liesl Venter
The roadfreight industry has once again called into question what they believe is f lawed logic in the proposed ban on trucks at peak hours.
High profile accidents such as the Fields Hill incident in which more than 20 people died, and the accident involving a truck which saw Minister Collins Chabane killed, did not happen during rush hour.
Trucks crawl along in traffic during these times much like every other vehicle on the road.
High profile incidents
like Fields Hill are being touted as the reasons why South Africa needs the ban but in fact it is hardly likely it will achieve any results other than impacting heavily on the economy.
According to Gavin Kelly, spokesman for the Road Freight Association (RFA), the issue around Fields Hill is a perfect example.
“The restriction will not address the problems being experienced there. Freight vehicles will be restricted during times of heavy congestion when all traffic moves slowly and not during the time when the horrific accident actually took place.”
The RFA has responded in detail to the proposed ban as well as to other proposed amendments to the National Road Traffic Act – including driving tests when licences are being renewed.
In its official response the organisation said the impact of the proposed legislation would be far-reaching, pointing out that truck utilisation would reduce by between 25% and 50%. “Assuming that fixed costs are roughly half of total trucking costs this could require between 12.5% and 25% rate increases from truckers,” reads the response.
According to Kelly, practically this means 1000 trucks at R500 per hour for six hours equates to R3m per day. Multiply R3m by 250 days per year one gets to R750m per annum.
“These costs will be passed onto customers and ultimately onto the end user as operators will not absorb them.”
At the same time all the
ports in the country will stand idle for six hours every day due to their proximity to the cities and the fact that at least 80% of the movements to and from ports are done by road.
RFA spells out the crippling cost implications of truck ban
MBABANE – Transporting live ammunition by air is a peril that nearly landed an American businessman in jail in Swaziland last week.
Hunting is big business in SA and southern Africa, with SA ranked first amongst world destinations in a survey of international travellers by Hunting Report. Zimbabwe was the second most popular destination,
with Namibia and Tanzania tied for the third spot. Hunting weapons and ammunition are airfreight staples.
Keith Brian Gardner, 56, of California apparently acquired 100 rounds of live ammunition in Swaziland, where he was investigating properties, and perhaps felt Swazi customs at the country’s international
airport wouldn’t notice the ammo in his luggage. An SA businessman came to court to testify that Gardner was part owner of a game park in Polokwane, where the ammo was destined. Gardner was fined for failing to acquire a licence with Swazi police to own the ammunition and for failing to declare the rounds at the airport.
Had Gardner made it to OR Tambo
airport, which is the only destination for commercial f lights out of Swaziland, he would have been permitted to bring up to 200 rounds of ammunition into the country as well as all manner of hunting guns and rif les excluding military-style weapons.
Hunting bows may be f lown in without special permit. Guns and ammo must be handled by airlines as special cargo, and a special fee for the service is levied.
The owner signs a receipt for the guns
with the airline upon arrival at OR
Tambo Airport
and declares the weaponry at the South African Police Firearms Department, where a Temporary Import Permit, SAP 520, is issued, good for six months.
If this permit is not obtained in advance via the Professional Hunter’s Association of South Africa, a wait of up to five hours can be expected at the airport.
However, air carriers no longer accept hunting trophies as air freight cargo. Taxidermists have stuffed too many illegal drugs and other contraband into mounted heads. – James Hall
Live ammo lands businessman in customs pickle
1000 trucks @ R500 per hour for 6 hours = R3m
R3m x 250 days per year = R750 m pa.
FTW3203SD
6 | FRIDAY June 26 2015
Government’s trade and industry policies are biased towards big business players and often fail to take into account the needs of the smaller producers.
That’s the view of Azar Jammine, director and chief economist at Econometrix, commenting on the news last week that two vehicle manufacturers – Nissan and General Motors – had been granted temporary exemptions from the minimum annual production threshold of 50 000 units in the Automotive Production and Development Programme (APDP).
Jammine told FTW that he believed the minimum annual threshold in the APDP programme could disadvantage
smaller vehicle manufacturers.“It’s these kinds of
exemptions that tend to open the way for abuse at the expense
of others and lend themselves to bribery and corruption,” he said.
He noted that the APDP programme had potentially left the smaller producers out in the cold in government’s attempts to be seen
engaging with bigger business players. “For government’s industrialisation policies to work, it needs to level the playing field a little,” Jammine commented.
Under the APDP programme, motor manufacturers that fail to achieve the annual production volume requirement will lose
the volume assembly allowance (VAA) – a support mechanism in the form of duty-free import credits issued to qualifying vehicle assemblers.
The granting of temporary exemptions from the annual production threshold to these two manufacturers follows the gazetting of an amendment to the APDP regulations by the Department of Economic Development in June last year.
Ford South Africa’s national communications manager, Alisea Chetty, issued this statement to FTW after a call for comment on Jammine’s statement: “The APDP significantly benefits South Africa – from job creation to increased local content via localisation initiatives. Having seven automotive manufacturers in South Africa producing vehicles is a testament to the success of the auto policy that the South African government has developed.”
She added: “The APDP programme is a reflection of the South African government’s long-term commitment to the auto sector. As the global environment is continuously changing, the APDP programme provides a platform for South Africa to compete and win new business.”
Another manufacturer told FTW that the automotive manufacturing sector was still not “up to strength” in South Africa, commenting that he welcomed any incentive the government could provide
in an increasingly uncertain production environment.
“The metals and engineering sector has been struggling for more than five years owing to fierce import competition from Asian economies, industrial action, increasing production costs and power outages, among other factors,” said Steel and Engineering Industries Federation of Southern Africa (Seifsa) chief economist, Henk Langenhoven.– Adele Mackenzie
Liesl Venter
Despite growth expectations of more than 5% for many African economies, 2015 is not an easy year for the continent, according to Celeste Fauconnier, African analyst for Rand Merchant Bank (RMB).
“Our forecast is the same for 2016 and we only expect to see some normalisation towards 2017," she said. “While Africa’s next chapter does include strong growth expectations – forecasts are above 4 and even 5%, there are several domestic and internal risks that are going to impact heavily.”
She said this would undoubtedly impact the investment landscape over the course of the next few years.
“Monetary policies are becoming more efficient and inf lation is far less of a problem in Africa than has been the case in the past, but it is not going to be easy sailing in 2015 or 2016.”
Commenting on fiscal restraint, Fauconnier said most countries would have to start spending less while trying to get more revenue.
“That means taxes will increase while investment in projects will decrease. To spend less, countries are going to have to look
at wages, but Africa does not want to cut back on wages. It’s all politics,” she said. “Because of the fiscal restraint countries are now trying to issue more debt – a major concern we have identified. Countries like Zambia, Ghana and Kenya are issuing Euro bonds of millions of dollars each. Effectively countries are pushing their debt levels higher and higher.”
The concern is that African countries are unlikely to see the debt forgiveness they experienced in the past again.
“What we are going to see is countries with substantial debt increasing – and while organisations like the International Monetary Fund are likely to help, we don’t expect to see a Paris Club getting
countries out of debt like they did in the early 2000s.”
Fauconnier said another
issue impacting on the current environment was the balance of payment situation. “That is imports and exports. Imports are increasing as consumers are demanding, but exports are dwindling in many of the countries because of the low commodity prices, and so current accounts are going into deficit.”
All of this combined is troublesome, she said. Add the low oil price into the mix and it is not as rosy as one would think on the African continent.
Fauconnier said expectations were that the oil price would not rise more than US$75 dollars per barrel in the next two years.
2015 not an ‘easy year’ for Africa
Dredging of the Cape Town multipurpose (MPV) terminal is finally under way after several delays to the project.
The dredger arrived in Cape Town earlier this year to start work on the terminal which is part of the container terminal. Smaller container vessels are handled at this terminal and it plays an extremely important role during heavy winds when the container terminal is
wind bound. Because of its location the MPV terminal is not as affected by wind and can continue operations far longer than the container terminal.
This is due to the location of the terminal which is somewhat protected by the mountains in the city.
The decision to dredge the terminal will improve its handling capacity, allowing
it to accommodate slightly bigger vessels.
“It will not handle the very big vessels and that is not our intention,” Pam Yoyo, Cape Town Container Terminal manager told FTW earlier this year. “Our goal really is to slightly improve the capacity so that we are able to use it more efficiently.”
She said the terminal was also used to improve wind
recovery efforts. By handling smaller vessels it has helped prevent congestion.
Dredging was due to have started last year but due to the unavailability of a dredger the project was placed on hold until the beginning of this year. It was then further delayed for unknown reasons but the first phase is believed to have been completed.– Liesl Venter
Dredging finally under way at CT terminal
Our goal really is to slightly improve the capacity so that we are able to use it more efficiently.– Pam Yoyo
“
For government’s industrialisation policies to work, it needs to level the playing field a little.– Azar Jarmine
“
African countries are unlikely to see the debt forgiveness they experienced in the past again.– Celeste Fauconnier
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Shipping and airfreight links between South Africa and West Africa
support growth in trade between the country and the region, which is home to some of the world’s fastest-growing economies.
According to the 2015 Global Sovereign Statistical Trends report, the Democratic Republic of Congo and Côte d’Ivoire are expected to be among the top ten fastest-growing economies in 2015.
Bloomberg placed Nigeria sixth in its list of the top 20 growth economies in 2015.
Supporting this growth is investment across the region
in ports, airports, road and – to a lesser extent – rail infrastructure.
All of which is making it easier for South African companies to trade with the region.
There are regular connections between the ports of Durban, Ngqura and Cape Town with the major West African hubs of Walvis Bay, Luanda, Point Noire, Tincan Island, Cotonou, Lome and Abidjan.
A number of lines service the route, and most of the world’s leading shipping lines call on West African ports.
There are also two flights a day between OR Tambo and Murtala Muhammed International Airport
(MMIA) in Lagos, which is the busiest airport in West Africa and the fifth-busiest in Africa.
Freight and passengers can also travel between OR Tambo and Luanda, Kinshasa, Libreville, Douala, Accra, Abidjan and Dakar, among others.
Governments and the private sector are supporting the economic growth by investing heavily in port and
other logistics infrastructure.This has resulted in a “ports
race” which has seen harbours in the region vying with each
other to attract direct traffic.
Côte d’Ivoire is one of the countries that has launched massive upgrades to its ports to support the growth of
the natural resource sector and to grow its share of regional transit trade.
A second container terminal is being built in
the Abidjan harbour, which is undergoing a $2.5bn expansion that is due to be completed in 2020.
The plans will enable the port to handle 2.25 million twenty-foot equivalent units (TEUs), which would give it the largest capacity in West Africa.
It will, however, face growing competition. Over the next four years at least 3.54m TEUs of new deep water container terminal capacity will be added to the West African coast.
Most will be able to take 10 000-TEU vessels, which is expected to result in a realignment of services to the region.
Additional capacity may lead to a price and service war between the different ports in a region, which could well go from under- to overcapacity in the short term.
Shipping lines will move their hubs to least-cost destinations, and transhipment is expected to move from remote ports such as Las Palmas or Algeciras to the West African coastline.
The growth of intra-regional shipping will be supported by the current and planned investment in the smaller feeder ports.
How this will impact on trade links between South Africa and the region remains to be seen, but for now there is ample capacity to support additional exports and imports by both sea and air.
Investment in infrastructure could create ‘ports race’
Port of Luanda... a major West African hub.
For now there is ample capacity to support additional exports and imports by both sea and air.“
2.25m TEUs
The potential capacity of Abidjan port once it has been upgraded.
WEST AFRICA
FRIDAY June 26 2015 | 9
All freight forwarders can access a range of options for airfreight out of South Africa and other departure points by leveraging the purchasing power and networks of neutral consolidators, according to Stephen Bishop, airfreight general manager of CFR Freight.
“With CFR being a top 10 IATA cargo agent in South Africa we have a competitive
airfreight offering into West Africa in particular due to our bulk buying power.
“We as the neutral wholesaler act as an intermediary for all companies that do not yet have representation in West Africa. Overnight they can be part of our network of fully fledged agents,” he says.
Operating as “an airline without an aircraft”, CFR airfreight has “dramatically” increased its footprint in Africa over the past year and can now offer DAP (Delivered at Place) solutions into 43 African countries, which means it has 80% of the continent covered, according to Bishop.
“With CFR being part of the Air Cargo Group global network we partner with African Express into several of the territories in East and West Africa and a handful of ‘local heroes’ across
the continent to ensure a competitive offering and an extension of our own network.
“Over 60% of our airfreight export volumes are into Africa, with West Africa featuring prominently. Lagos and Accra are two of our top destinations,” he says.
Airfreight growth is largely determined by the trends in passenger traffic across the continent, he adds.
“The airfreight industry is driven by cargo carried on passenger planes. Airlines are putting an increasing number of wide-bodied aircraft on the routes. Even with narrow-bodied aircraft there is an opportunity for airfreight wherever there are passengers,” he says.
While urgent cargo has traditionally been transported by air, shippers are also turning to airfreight for time-sensitive cargo due to congestion and delays
at border posts across the continent, according to Bishop.
Airlines have the capacity to move all types of cargo into West Africa. “Whatever the freight forwarders want we will move.”
Cargo being moved includes mining spares, perishables and general cargo.
With most of the traffic being imports into West Africa there is spare airfreight capacity out of the region, which creates opportunities for South African importers or traders.
Freight forwarders in South Africa are also able to make use of the CFR network to move cargo by air directly to and from Europe, the Americas
or the East into and out of West Africa on behalf of their clients, he adds.
“We have the ability to assist agents with cross trade within the Air Cargo Group. If requested, billing is done in
South Africa,” he adds.– Ed Richardson
Airfreight gives small-to-medium-sized forwarders a lift
Over 60% of our airfreight export volumes are into Africa, with West Africa featuring prominently.– Stephen Bishop
“
FTW3151SD
10 | FRIDAY June 26 2015
WEST AFRICA
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Agricultural exports to Angola are being limited by the government in
order to protect and stimulate local industry in an effort to wean the country’s economy off its heavy reliance on oil revenue.
A joint decree published by the Angolan Ministries of Agriculture, Fisheries, Industry, Commerce and Transportation, along with the Central Bank, announced the new import quotas recently.
According to the Ministerial Decree, the purpose of the quotas is to diversify the Angolan economy by supporting non-oil sectors.
Oil accounts for 98% of Angolan export revenues, the country’s oil minister Botelho de Vasconcelos is reported to have told journalists on the sidelines of June’s OPEC meeting in Vienna earlier this month.
Its biggest customer is China, and Angolan president
Jose Eduardo dos Santos paid an official visit to China in June in order to bolster trade between the two countries.
As Africa’s second-largest crude oil exporter, Angola produces 1.7-1.8 million barrels per day of heavy,
sweet crude, which is low in sulphur.
In January this year the government of Angola revoked import licences for
25 agricultural products including poultry, effectively blocking imports of these products for an unspecified duration, according to the Global Agricultural Information Network of the United States Department of Agriculture (USDA).
These changes in Angolan’s trade policy affect some US$2.5 billion worth of agricultural Angolan imports from around the world, according to the USDA.
Import quotas have been placed on vegetable oil, maize flour, salt, rice, sugar, water, sodas, eggs, potatoes, garlic, onion, beer, juices and nectars.
Countries most affected are Portugal, the United States, Brazil and South Africa.
Angola imports machinery and electrical equipment, vehicles and spare parts; medicines, food, textiles and military goods.
According to Trade Map 2015, Portugal was the leading exporter of food and beverages to Angola in 2013 (worth R9.2bn), followed by Brazil and South Africa
valued at R6.8bn and R2.9bn respectively.
Other top exporters to Angola were the United States (R2.6bn), India (R2bn) and Malaysia (R1.8bn).
Angola is currently South Africa’s fourth-largest export destination in Africa, according to the Western Cape Destination Marketing, Investment and Trade Promotion Agency (Wesgro).
In 2013, South Africa exported food and beverages valued at R2.8bn to Angola compared to R2.2bn in 2012, representing an increase of 31%, according to Wesgro.
Western Cape exports fall outside the current Angolan import restrictions.
The leading export product from the Western Cape to Angola in the food and beverages sector is liqueur, valued at R299m followed
by apples, pears and quinces (R163m) and other fermented beverages (R160m).
The Western Cape accounts for 52.3% of South African food and beverage exports to Angola.
South African exports of sugar (worth R279 million in 2013) are expected to be affected by the new quotas.
Investors in the agricultural sector may be attracted to Angola by the support for buying local being provided by the government.
Business Monitor International 2015 describes Angola as a “high-risk, high-reward food and drink market in sub-Saharan Africa."
It is currently an exporter of crustaceans, whole frozen fish, coffee and non-alcoholic beverages, with its biggest market in 2013 being Spain.
SA will feel impact of Angolan import quotasGovernment determined to diversify away from oil
98%The percentage of export
revenue for which oil accounts.
WEST AFRICA
FRIDAY June 26 2015 | 11
FTW6311
• Global ISO tank operator• Founded in South Africa in 1996• Safe environmentally friendly transport of bulk liquids, into and out of SA• Specialists in the Oil & Gas Industry• Highest standards of service, quality and safety• ISO tanks are completely multimodal and can be used for bulk storage
Growing their African footprint is high on the agenda for newly established Outsourced Project Solutions (OPS).
According to general manager Tyron Hubbart, the company has seen rapid growth in South Africa and has now set its targets on the African market.
“We believe this is because the service we are offering is specific and meets the very needs of the industry,” he told FTW. “It allows for a leaner supply chain. It is all about making logistics less of a hassle.”
The company provides outsourced services on a per project basis and has seen business across the country knock on its door to handle projects on site ranging from 500 to 500 000 tonnes of goods per month.
“This service is in high demand as it allows customers to focus on their core business. They now no longer need to manage labour-intensive acitivities on their sites and don’t have to deal with the various labour challenges like
legislation around labour brokers or casual labour,” said Hubbart.
He believes that in the broader African environment there is also a need for outsourcing specific projects and processes within the logistics chain.
“We are aiming to implement our African strategy in early 2016 and are very optimistic about the prospects,” he said.– Liesl Venter
‘Per project’ outsourcing reduces hassle
Customers no longer need to manage labour-intensive acitivities on their sites and don’t have to deal with the various labour challenges.– Tyron Hubbart
“
12 | FRIDAY June 26 2015
WEST AFRICA
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Ed Richardson
Low oil prices are affecting exports to Nigeria by placing the country’s
foreign reserves under pressure.
In its statement after a monetary policy committee meeting in May, the Central Bank of Nigeria reported that a deceleration in growth, which commenced in the third quarter of 2014, had intensified in the first quarter of 2015 “in the aftermath of declining crude oil prices”.
Adding to the risks for South African exporters is the fact that in April this year South African trade relations with Nigeria were threatened by the xenophobic attacks on Nigerians and other
African citizens in South Africa.
According to media reports the Nigerian government sent a strongly
worded communique to the South African embassy in Lagos threatening to shut down South African businesses operating in Nigeria.
These include MTN, Multi Choice and Shoprite,
All Progressive Congress (APC) spokesperson Tolu Adesanya is reported as saying.
Nigeria is seen as an important market.
It is home to roughly 20% of sub-Saharan Africa’s 930 million people and has a population growth of 2-3% a year.
Nigeria imports mainly industrial supplies (27% of total in 2014), capital goods (23%), food and beverage (17%), fuel and lubricants (14%), transport equipment and parts (12%) and consumer goods (7%).
Some 43% of total imports come from Asia; 34% from Europe; 15% from America and 7% from Africa, according to the National Bureau of Statistics, Nigeria (NBS).
The NBS estimated Real GDP growth at 3.96% in the first quarter of 2015, which is significantly lower than the 5.94% and 6.21% in the preceding quarter and the corresponding period of 2014.
It is the lowest growth rate since the last quarter of 2012, and the third consecutive quarter of slowdown.
Real GDP growth is projected to decline to 5.54% in 2015 from 6.22% in 2014.
The main driver of economic growth is the non-oil sector.
Services contributed 2.82% to growth, trade 1.27%, and agriculture 1.05%.
In its efforts to diversify the country’s economy the government is likely to target agricultural imports in order to support local farmers.
Speaking to CNBC Africa on the sidelines of the World Bank and IMF
annual meetings in February, Adesina said the region was spending about US$45 billion on food imports annually.
“We have a lot of water and we have cheap labour across African economies
and what we should be doing is producing our own food so that we become a global powerhouse in food production,” he said.
Adesina said the agriculture sector had positive future prospects.
“The size of the food and agribusiness will be one trillion US dollars by 2030.
“The foreign direct investments that will go into this sector will rise to US$45 billion by 2020 so as Nigeria we are paying attention to this sector.”
Exports to Nigeria affected by oil price
Nigeria's import basket7%
27%
Consumer goods
Industrial supplies
Food & beverage
Fuel & lubricants
Transport equipment & parts
Capital goods
23%17%
14%12%
Main import sources7%
15%
34%
43%
Africa
America
EuropeAsia
(2014 figures)
In its efforts to diversify the country’s economy the government is likely to target agricultural imports in order to support local farmers.
“ 5.54%Projected GDP growth in 2015.
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14 | FRIDAY June 26 2015
WEST AFRICA
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Confidence seems to be returning to the West Africa multipurpose market
with infrastructure, power generation, rail and mining-related cargoes supplementing the drop in oil and gas volumes.
“We’ve been keeping a very close eye on multipurpose trade activity in West Africa and are beginning to see signs of increased market confidence,” according to SafmarineMPV Southern Africa line management, James Lewer and Pamela Yerushalmy.
“This confidence is reflected in the current levels of multipurpose trade activity, the number and nature of enquiries being received as well as the positive sentiments expressed by regular shippers, cargo owners and manufacturers.”
While oil- and gas-related cargo volumes in general have slowed as a result of the drop in the international oil price, SafmarineMPV believes that because of its broad end-market exposure that there is still plenty of opportunity in the market.
For example, investment
in power plants and utilities, a priority for many African countries, has boosted imports of raw materials and capital equipment to support these investments.
“From a geographical
convenience point of view, a great deal of the cargo needed for these large infrastructural projects in West Africa is being sourced from southern Africa and transported by sea on services such as
SafmarineMPV’s SAFWAF service,” says Lewer. It offers regular sailings ex Durban, Cape Town and Walvis Bay to Matadi, Boma, Sonils, Pointe Noire and Port Gentil.
Lewer is hopeful that
this increased market confidence will also result in more rail-related cargoes moving by sea. “Last year, SafmarineMPV successfully shipped 11 rail wagons from South Africa to Angola and is ideally positioned to service shipments of this type into the rest of West Africa,” he said.
“The importance and potential of improved rail infrastructure in Africa was highlighted at the recent Southern African Railways Association (Sara) conference and several southern African countries have expressed interest in investing more heavily in new infrastructure and equipment for their national railways.”
Shippers are, however, likely to remain cautious while the market recovers.
Multi-purpose market shows signs of growth
Confidence in West Africa’s multipurpose trade is being boosted by, amongst others, investment in power, utilities and the national railways of several African countries.
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WEST AFRICA
An artist's impression of Porto de Caio.
Leading corridor operator in southern Africaproviding end to end logistics
Bolloré Africa Logistics,a worldwide network dedicated to Africa
Branches in Durban, Cape Town, Port Elizabeth, Richards Bay
FTW7266
Work has started on a new port to serve the oil-rich Cabinda
province of Angola.According to a statement
from Porto de Caio, the first phase of construction was awarded to Franki Africa Sucursal Angola.
It involves the mobilisation of equipment recently delivered from Europe for the drilling of 20-60 boreholes into the sea bed which will provide information critical to
the foundation of the port. A geotechnical barge,
a modular self-elevating platform, will utilise a jacking system to drill the ocean bed which is estimated to be completed in eight to 10 weeks.
This work is seen as an important first step to completing the first berth of the new port in the third quarter of 2017.
“This stage in the development of the port marks a key milestone for the
project”, said Brian Fuggle, CEO of Porto de Caio.
“The information that it will produce is crucial for us to design and construct the best possible port which will serve as a gateway to increased economic growth.”
Porto de Caio was awarded the concession to plan, design, build and manage the Port of Caio in August 2012.
The port itself is strategically positioned nine kilometers north of the Province of Cabinda in Caio.
Construction starts on new Angolan port
West Africa is one of Africa’s most mobile regions.
Intra-regional migration represents a large part of its cross-border movements and has widely been recognised as key to the region’s economic growth and stability.
However, the region is also home to Ebola and a number
of secessionist or terrorist groups.
Governments within the Economic Community of West African States (ECOWAS) are turning to modern technology to help them control the borders without affecting economic growth and trade.
An ECOWAS National Biometric Identity Card is being introduced as a travel document within the region in place of the ECOWAS Travel Certificate, which will cease to be produced.
The introduction of the card is scheduled to start in 2016.
Biometrics help support trade The Nigerian government has launched a cross-government single window trade portal to assist exporters and importers.
It is designed to allow traders to quickly reference important information on different government agencies involved in trade matters, as well as link to their websites through
a convenient hub, according to the site.
Included in the portal is an interactive Trader’s Guide, which details the requirements for products based on keywords or four-digit tariff codes.
Using the portal the trade can also conduct tariff searches and find regulatory guidelines.
Single-window trade portal
Phase 1
Phase 3
Phase 2Potential for oil jetty
Rig service facility
Ship repair facility
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18 | FRIDAY June 26 2015
WEST AFRICA
UPS are the world’s largest express carrier. We have 100 years of service and the widest portfolio of shipping solutions.
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IT’S NOT A BADGEIT’S PEACE OF MIND FOR YOU & YOUR CUSTOMERS
G roupage volumes to a number of destinations along the West
African coast are growing, according to Levashni Govender, export route coordinator of CFR Freight South Africa.
The company offers direct services into Apapa (Nigeria), Tema (Ghana) and Luanda (Angola).
“LCL (less than container load) volumes out of South Africa are constantly growing for us,” she says.
However, volumes are such that transhipment cargo from the main hubs in the Far East like
Shanghai, Hong Kong or Singapore is now
often loaded in direct boxes
bypassing SA, she adds.
CFR is
establishing a network of strong agents which provide support to South African companies wanting to export into the region.
“West African countries import 99% of their commodities. Shippers need to familiarise themselves with the needs of the market and then to align themselves with reliable partners,” she says.
This approach is bearing fruit.
“There has been a significant increase in our Angolan business due to the recent establishment of a partnership with our Angolan agents. Their excellent service and communication has been a key contributing factor to the growth on the route,”
she says.CFR’s agents in Apapa,
Nigeria, have invested in their own bonded warehouse. It is located close to the major seaport complexes of Apapa Wharf and Tincan Island.
The secure facility is covered by CCTV with high definition cameras, says Govender.
One of the biggest advantages for shippers is that it helps avoid the delays caused by congestion in the port of Lagos.
“The warehouse hosts NCS (Nigeria Custom Service) and other regulatory personnel. This enables clients to collect cargo without delays, and is a definite competitive advantage,” she says.
Further up the coast CFR has increased its Ghana Tema frequency to a weekly service.
The company is the only groupage operator that offers a direct, weekly service, according to Govender.
Groupage volumes by sea show growth
There has been a significant increase in our Angolan business due to the recent establishment of a partnership with our Angolan agents.– Levashni Govender
“
For further information, please contact:Cape Town (General Agents)Meihuizen InternationalRichard Fortune/ Maria AndersonT: +27 21 440 5400F: +27 21 419 8952E: [email protected] E: [email protected]
Containerised service including reefer cargo and hazardous cargoesCalling Angolan Ports from South AfricaPrompt, efficient serviceSpecialise in breakbulk & project cargo
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IT’S NOT A BADGEIT’S PEACE OF MIND FOR YOU & YOUR CUSTOMERS
Business to consumer (B2C) online sales in West Africa are expected to
experience double-digit growth over the next three years, with Nigeria leading the market in the region.
This prediction is made by yStats.com, which earlier this year released a report which states that Africa is considered a “late entrant” into the global e-commerce scene due to a combination of low Internet penetration, underdeveloped logistics and limited cashless payments infrastructure, along with high poverty rates and low income.
“However, recent signs of improvement have led to forecasts of B2C e-commerce sales in the region growing at high rates,” it says.
According to the International Communications Union, around 16% of the African population has internet access, up from 10% in 2010.
This is reflected in Nigeria reporting 38% growth in online sales in 2013, Senegal 21% and Ghana 12%. The
leader on the African west coast is Morocco with 56% growth – ahead of South Africa’s 49%, according to yStats.com.
The figures support a report released by McKinsey & Company which predicts that e-commerce could account for 10% of retail sales in Africa’s largest economies by 2025.
Opportunities are being opened up for smaller exporters by the trend towards e-commerce.
“It is no longer just the larger corporations that need to make use of logistics and delivery services, but individual consumers and small businesses too,” says Charles Brewer, Managing Director of DHL Express SSA (sub Saharan Africa).
He cites the Economic Community of West African
States (ECOWAS) as one of the successful trade blocs in Africa.
Exporters based in South Africa have ready access to the West African markets through regular shipping and airfreight services.
According to a recently published study conducted by Ipsos on behalf of PayPal and FNB, South African e-commerce sites are already popular with Nigerian shoppers.
The study found that 30% of Nigerian cross-border shoppers (online shoppers who have made purchases online from another country) have purchased goods from South Africa in the past 12 months.
Nigeria has the largest number of potential online shoppers in Africa, according to Ipsos.
E-commerce growth creating opportunities for SA exporters
Nigeria38%
Senegal21%
Ghana12%
Morocco56%
South Africa
49%
Growth in online
sales
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22 | FRIDAY June 26 2015
Alan Peat
As more and more business-to-business (B2B) sales are conducted on-line, the forwarding industry is failing to respond to the needs of this cyber environment.
That’s the finding of a survey conducted by Hong Kong-based freight-rate management software provider, Freightos, which found most freight forwarders were missing sales opportunities by failing to respond in a timely and user-friendly way to customers’ online quotation requests.
According to Freightos, shippers and procurement officers are “increasingly
likely to buy both goods and services online” – with online business-to-business (B2B) sales predicted to reach the equivalent of almost R87 trillion by 2020, around 27% of global manufacturing trade.
At present, 40% of business-to-customer (B2C) commerce is now cross-border, and B2B is catching up fast. Also, 68% of B2B
buyers with budgets of more than R1 million buy online, up a full 10% from 2013.
To test the forwarding industry’s operational readiness, Freightos studied the rate-quoting speed and responsiveness of the world’s Top 20 forwarders.
It found to its dismay that leading forwarders’ average process time for online
quotes was 90 hours; it took three clicks on average to get to the online request form on leading forwarders’ sites; and 45% of shippers were discontented with their forwarder’s information technology (IT) capabilities.
In terms of the quote itself, the results were disappointing. Only 45% of forwarders ultimately provided a quote,
and only five companies followed up the quotes in an attempt to secure the business.
The forwarders’ responsiveness was also poor. Of the 16 forwarders from whom quotes were requested, 75% did not automatically confirm receiving the request, and three of them did not respond to the initial request at all.
The fastest personal confirmation of a request received took seven hours; one forwarder insisted that quotes would only be provided after an in-person meeting; and five required multiple conversations to clarify details, revealing a lack of sufficient information requested of the buyer in the initial quote form.
Freightos also noted that none of the forwarders provided instant online pricing for international
freight sales; 20% of the top 20 forwarders had neither an online quote form nor a “contact us” form available on their website to attract new business; and only
30% of the forwarders’ homepages had a dedicated ‘call to action’ geared towards landing new shippers’ business.
Freightos CEO Zvi Schreiber found that the industry was aware of the incredible potential for online sales, but most provided what he termed “a subpar online customer experience”, with slow, manual freight pricing and quoting.
Just how user-friendly, responsive and timely have you found forwarders to be when you have requested quotes on-line? If you have something to say on this matter, send an email to [email protected]
Good or not so good, that is the question.
Global forwarders fail to meet on-line business needs
20%Percentage of Top 20 who
have no online quote form.
Rate-quoting speed & responsiveness of world's Top 20 forwardersTime to process quotes: 90 hoursThree clicks to get to online request form
% of shippers dissatisfied with forwarders IT: 45%
16 forwarders contacted
75% did not automatically
confirm receipt of
request
3 did not respond at all
Twenty years of operation has seen the Cape’s Port Liaison Forum (PLF) become a model for solving complex problems where many parties are involved.
The organisation recently celebrated its 20th anniversary at a glitzy evening function hosted by the Cape Chamber of Commerce and Industry, bringing role-players together to reminisce about the early days and also to look to the future.
“It has provided a neutral forum where the practical problems of shipping goods in and out of the country can be discussed and solved,” said Janine Myburgh, president of the Chamber.
The PLF brings together all stakeholders once a month to sit down around one table
In the early days the unions representing the dock workers also played a constructive part and
provided insight into some practical issues although they are no longer represented at the forum.
But it was during these very first discussions at the PLF that members began to see the viewpoint of others. This in turn led to a better understanding of the problems, and solutions that really worked were created.
Before 1995 volumes of imports and exports were low and the situation was manageable. After 1995 the economy improved and world markets opened up to South Africa. The port authorities expected growth. The first three years saw an annual growth of 1.7% and a prediction of a 3% growth
for the future.“They couldn’t have been
more wrong,” said Myburgh. “International markets were opening up. In 1999 container volumes grew by 7.2%, by 8.4% the next year and by 23.6% in 2001 leading to a crisis in 2002.”
At one stage the congestion delay was 72 hours at the port. The port was working 24 hours a day and delays were costing many millions of rands while exporters were losing orders. Ships were
by-passing Cape Town.It was clear that
emergency measures were called for. The first of these was to get the private sector to operate around the clock.
The port did not have enough space to stack containers and it did not have enough staff and equipment. Government purse strings were loosened, more people were employed and efficiencies improved.
Mike Walwyn, chairman of the PLF, said there was a great deal of frustration. Trucks laden with containers queued for hours to gain admission to the port and the problem spilled over into the city traffic.
“Discussions at the PLF have helped everyone to gain a better understanding of the issues, leading to major decisions to develop the port and invest in new cranes and straddle carriers and reefer points for the cooled containers of export fruit.
“Not all the problems have been solved and there will be new problems in the future but we have a forum to deal with them. That gives us all a great deal of confidence for the future,” said Walwyn.
Twenty years of constructive problem solving
Discussions at the PLF have helped everyone to gain a better understanding of the issues.– Mike Walwyn
“
An indigenisation drive by the Namibian Ports Authority (Namport) is reaping dividends, according to a statement by the organisation’s board of directors.
Companies wanting to do business with the Namibian Ports Authority (Namport) must be 51% Namibian-owned.
“Namport tenders now require mandatory participation of Namibian registered entities whereby at least 51% effective ownership of the tendering entity is held by Namibian nationals of which 30% must be PDN (previously disadvantaged Namibian) nationals or joint venture formats,” reads the statement.
It adds that since implementation of this drive in August 2014 there has been an “exponential growth in the value of goods and services now being procured from Namibian-owned companies and entities in which PDNs have direct ownership and participation. – Ed Richardson
‘Buy Namibian’ drive works
FRIDAY June 26 2015 | 23
tHe BaD news
NO:1234 /11:12:2014
BUsiness ConFiDenCe at 16-Year LowpMi JUst a sHaDe aBoVe ‘no GrowtH’ sCenario
FitCH warns oF FUtUre DownGraDe
eskoM FiasCo to BLaMe?
The entire freight and trade industry is sitting in the middle of an economic minefield, surrounded by explosive indicators.
The SA Chamber of Commerce and Industry (Sacci) business confidence index (BCI) for May 2015, for example, blew up and confidence slipped to a 16-year low of 86.9, almost matching the equally disastrous 86.8 registered in September 1999.
Also, the HSBC purchasing managers' index (PMI), another good indicator of private sector fortunes (or, in this case, misfortunes) declined from 51.5 in April to 50.1 in May – staying just a shade over 50 which is the cross-over point into a “no growth” scenario.
Meanwhile, the rating agency Fitch recently left SA’s sovereign credit ratings unchanged at BBB. But it warned that there was a list of factors – like weak economic growth and failure
to reduce the budget deficit, stabilise government debt, and to materially narrow the current account deficit – that could lead to a downgrade in future. And that would prove disastrous, as it would mean that SA, as far as Fitch and fellow rating agency Standard & Poor were concerned, would slip into the realms of junk bond status.
Given this, plus all the other bad signs and the Eskom fiasco, which gets a pretty fair share of the blame for this sorry state of affairs, SA is now singing the economic blues.
What are the indicators and feelings in the freight industry about present conditions?
Dave Logan, CEO of the SA Association of Freight Forwarders (Saaff), agreed that the fortunes of the clearing and forwarding industry were in close alignment with the surrounding economic conditions. That when
international and/or local trade was curbed for any reason, then the revenue of the c&f industry was equally restrained.
“It is having to transact business in the current unfavourable SA economic environment,” he said. “This includes the current foreign exchange rates lowering the buying power of the rand, especially from
an import point of view; the Eskom situation as mentioned; and the continuous stream of legislation with which to comply. This does not make doing business any easier.”
Sue Moodley, MD of transport.com and chairman of the Durban Harbour Carriers' Association (DHCA), was in concord with this statement when related to road transport.
“The freight industry is battling to sustain itself due to the economic decline. Should the present conditions not be timeously addressed, SA will find itself in a very difficult position.”
Gavin Kelly, operations and technical manager of the Road Freight Association (RFA), agreed.
“Just driving around the various second-hand truck dealers in Gauteng is a good indication of the drop in road freight demand,” he pointed out. “There are an estimated 4 000 second-hand/repossessed trucks (rigid and combinations) that are unsaleable in Gauteng alone. There are also rumours that there are in excess of 1 000 new side-tippers and flat-deck trailer combinations at various trailer manufacturers which cannot be sold.”
He also noted that there was a definite drop in freight demand – driven partly by the international drop in demand as well as the shrinking purchasing power of the average citizen in SA.
“Major routes (N3/N4 N1) have seen drops of between 1.5% and 3.6% in freight traffic over the last 18 months,” Kelly added. “There has been some correction (especially along the N3) but this would not point to a
‘recovery’ of any sort.“Definitely – times are
tough, economic activity has slowed and there is a general feeling of business pessimism.”
And Moodley outlined the factors that have negatively impacted on the freight industry.
“Due to the energy challenges which South Africans at large have faced daily, this has weakened our economic growth."
She also noted that household spend had been slowed down due to excessive debt. Alongside this, SA has also been affected by weak employment growth, which in turn has constrained income generation, and has had a negative impact on household confidence. “This had a direct bearing on the supply and demand of consumer products,” Moodley added, “which, in turn, had a
downward impact on freight transport demand.”
Labour unrest and strikes have affected performance in the manufacturing, mining and agricultural sectors. “This has had a direct impact on the import and export industry, and the truckers who carry the goods.
“Our existing rail, road and port infrastructure has also not been efficient in the present times. We have been inundated with bottlenecks in the transport industry and these conditions add to the declining
economy.”– Alan Peat
Industry sings the economic blues as it battles sustainability Labour unrest has
had a direct impact on the import and export industry, and the truckers who carry the goods. – Sue Moodley
“
Last week’s top stories on
Sars seizes over R3m-worth of counterfeit sneakersThe South African Revenue Service (Sars) confiscated over R3 million worth of suspected counterfeit sneakers at the Lebombo border post last week.
Zambian lesson in how to 'lose' two shipyardsThe Zambian government
has started talks with Kenya and Tanzania in an effort to reclaim its shipping yards in the two countries, local media reported.
Mugabe calls for improved industrialisationRobert Mugabe, African Union chairperson and president of Zimbabwe, has called on the southern African region
to stop the export of Africa’s unprocessed raw materials and focus on industrialisation and mineral beneficiation.
SA a 'ticking time bomb' of vehicle crimeSouth Africa is a “ticking time bomb” of vehicle crime, says f leet management and stolen vehicle tracking company, Cartrack Holdings.
SA still faces several ‘doing business’ challenges – World BankThere are still several challenges facing entrepreneurs doing business in South Africa, according to the World Bank’s latest ‘Doing Business in South Africa 2015’ report.
Spate of armed robberies at warehouses Freight forwarders and clearing agents in Gauteng have been put on the alert by the SA Association of Freight Forwarders (Saaff) to growing numbers of armed robberies currently taking place in the province.
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Trucks carrying both import and transit cargo are being delayed by up to 10 days at the border following the introduction of a centralised clearing system by the Zambian Revenue Authority.
According to the Zambia Revenue Authority (ZRA), the Central Processing Centre (CPC) was introduced in April in order to reduce corruption at the border posts.
The CPC is intended to provide consistent and standardised application of regulations across all borders in Zambia, regardless of the border one chooses to use, and an opportunity to offer customs services on a 24-hour basis even when some borders have closed, ZRA corporate communications manager Mumbuna Kufekisa said in a statement in April.
However, earlier this month (June) the Zambia Shippers' Council (ZSC) issued a statement voicing concern that the system had
New customs system clogs up Zambian border
resulted in delayed clearance of imported goods into the country.
It is a based on AsycudaWorld and is reliant on fast and consistent Internet connections between the border posts and the centre in Lusaka.
According to clearing agents and truckers interviewed by FTW in Zambia recently, Zambia does not have the required bandwidth and connections between the border posts and
the CPC – which results in delays due to downtime.
These delays are adding to the cost of road transport into and out of Zambia, according to Shashi Patel, chairman of the Truckers’ Association of Zambia.
Trucks can only make a maximum of two trips a month to Beira or Johannesburg due to the delays.
Even cargo which carries no VAT or duties is taking up to a week to clear, he says.
New shift…
encapsulates the essence of what we are trying to achieve.
“Next year marks CFR’s 25th year in business,” he told FTW. “During that time the company has evolved way beyond its original focus as a neutral seafreight groupage operator. While we continue to cater exclusively for the freight forwarding industry, our expanded portfolio now covers all transport modes. Our ZacPak division offers not only packing and unpacking of containers but has moved into domestic delivery, while international expansion has further diversified the product mix. Our rebranding aligns the different divisions under one strategic intention.”
‘Shifting Your World’ will become fundamental to the
DNA of every staff member, says managing director Martin Keck. “The ultimate goal is to be the principal ‘go to’ brand in the freight industry.
“What’s important is that it’s not about rates,” said Keck. “It’s about partnership with our customers, providing tailored solutions and adding value to the supply chain. We aim to be both the service provider and the employer of choice.”
ZacPak group MD Willie Nel believes that these are the values that are fundamental to the continued growth of the company. “The brand will be so entrenched that the freight industry will automatically think of ‘CFRing’ when it comes to moving their cargo.”– Joy Orlek
From page 1
Dube TradePort CEO Saxen van Coller has been dismissed following her suspension in February this year.
A disciplinary process chaired by an independent presiding officer found that she failed to disclose previous criminal offences and a previous criminal
conviction prior to being appointed to the position of CEO.
FTW understands that faking her academic qualifications is among the charges.
Hamish Erskine will continue as acting CEO until the appointment of a new CEO.
DubeTradeport CEO fired
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