Southern Africa’s freight demand The potential for rail and connecting with ports

David King3 March 2016

Focussing on the 17 southern most countries

Total surface freight in 2014=

1.5 billion tonnes

of which…

Intra region

Imports

Exports

Domestic

67%

Forecasted GDP growth

19801983

19861989

19921995

19982001

20042007

20102013

20162019

20222025

20282031

20342037

20402043

20462049

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

AngolaBotswanaBurundiCongo, Dem. Rep.Congo, Rep.KenyaLesothoMalawiMozambiqueNamibiaRwandaSouth AfricaSwazilandTanzaniaUgandaZambiaZimbabwe

GD

P Bi

llion

US

$

The possible declining role of South Africa in the region

1990 2000 2010 2020 2030 2040 2050

South Africa 73% 68% 62% 53% 45% 36% 27%

All non South Africa 27% 32% 38% 47% 55% 64% 73%

Mozambique 2% 2% 2% 4% 8% 12% 17%

Tanzania 3% 5% 4% 5% 8% 11% 14%

Angola 5% 5% 14% 16% 15% 14% 13%

Source: BASELINE database 2050 version 2.1, 2012, CEPII

Percentage of Regional GDP

30-year growth forecast (2014 -2045)

• GDP CAGR* = 2.8%

• Volume CAGR = 3.9%

• High long-term volume growth forecasted for:– Mozambique

– Botswana

– Tanzania

– Rwanda

– Uganda

– DRC

* Trading Economics 2015, http://www.tradingeconomics.com

Land freight transport intensity

Angola

Kenya

Congo

Rwanda

Tanzan

ia

Namibia

Uganda

Burundi

Botswan

a

Swazi

land

Lesotho

South Afric

a

Mozambique

Zimbab

we

Zambia

DRC

Malawi0.0

1.0

2.0

3.0

4.0

5.0

6.0GD

P pe

r ton

ne-k

m

Background and methodology• RFDM sponsored by

• The 17 countries are divided into 63 districts

• Contains 66 commodity groups

• Base year with two forecast year sets (2020, 2045)

• Started in 2012 and 2016 will be the fifth iteration

• Output in tonnes and tonne-km

Trade volumes (million tonnes) South Africa’s share

204520202014

505 million tonnes

=Only 2.6% of world seaborne trade

but

41% of African seaborne trade*

* UNCTAD Review of Maritime Transport 2015

Estimated and forecasted trade volumes

Continental trade profile 2014

67%

15%

2%

6%

10%

* Volumes in million tonnes

ExportsImports

Opposing forces

Seaborne imports 2014

Seaborne imports 2045

Imports =

128 million tonnes in 2014

and is forecasted to grow at a

CAGR of 4.4% to

485 million tonnes by 2045

Seaborne exports 2014

Seaborne exports 2045

Exports =

318 million tonnes in 2014

and is forecasted to grow at a

CAGR of 3.7% to

968 million tonnes by 2045

Major commodities traded (2014 and 2045)*

Coal Mining

Wood timber and products

Processe

d Foods

Gas

Cement0.0

1,000,000.02,000,000.03,000,000.04,000,000.0 Export tonnes 2014

* Excluding South Africa and intra-regional trade

Coal Min-ing

Iron Ore Gas Wood timber

and products

Processed Foods

0.0

20,000,000.0

40,000,000.0

60,000,000.0

80,000,000.0

100,000,000.0 Export tonnes 2045

Fuel refined

Processed Foods

Iron & Steel

Cement Wheat0.0

2,000,000.04,000,000.06,000,000.08,000,000.0

10,000,000.012,000,000.014,000,000.016,000,000.018,000,000.0 Import tonnes 2014

Fuel refined

Iron & Steel

Cement Processed Foods

Wheat0.0

10,000,000.0

20,000,000.0

30,000,000.0

40,000,000.0

50,000,000.0

60,000,000.0 Import tonnes 2045

Multi-modal corridors in the region

Congo GobaBas Congo MaputoMalanje LimpopoLobito-Benguela North SouthNamibe BeiraTrans Cunene NacalaTrans Caprivi TAZARATrans Kalahari East Africa

CentralTrans Oranje East Africa

NorthManzini LAPSSET

Existing and potential multi-modal corridors

Corridor trade volumes

East

Afri

ca N

orth

Map

uto

North

-Sou

th B

BRNo

rth-S

outh

BR

Beira

Taza

raNo

rth-S

outh

NRZ

Tran

s Ka

laha

riEa

st A

frica

Cen

tral

Tran

s Cu

nene

Tang

aCo

ngo

Limpo

poLo

bito

-Ben

guel

aBa

s Co

ngo

Leso

tho

Tran

s Or

anje

Naca

laGo

ba-L

ebom

boM

anzin

i-Dur

ban

Mal

anje

Gaut

eng-

Swaz

iland

Nam

ibe

Tran

s Ca

priv

i0

5,000,000

10,000,000

15,000,000

20,000,000

25,000,000

30,000,000

35,000,000

40,000,000

0

15000000

30000000

45000000

60000000

75000000

90000000

105000000

120000000

24,3

38,8

43.7

516

,331

,145

.97

11,4

74,3

88.8

28,

017,

312.

276,

708,

918.

425,

137,

476.

334,

800,

626.

314,

797,

532.

344,

325,

509.

554,

297,

033.

704,

184,

448.

983,

330,

665.

122,

300,

728.

982,

226,

903.

052,

178,

861.

181,

815,

512.

661,

778,

861.

711,

772,

687.

481,

611,

634.

251,

431,

086.

441,

377,

868.

121,

285,

202.

5895

3,26

3.31

267,

197.

17

105,

637,

620.

1936

,580

,058

.61

60,5

34,3

38.8

461

,630

,839

.50

80,1

14,1

59.1

026

,346

,177

.08

13,5

73,4

86.1

723

,793

,136

.73

23,4

07,8

96.2

318

,868

,069

.28

26,7

11,1

47.4

615

,378

,624

.41

9,71

8,81

9.78

10,3

58,0

58.7

016

,880

,683

.59

5,63

8,40

7.78

7,72

6,74

2.02

26,3

31,5

89.3

86,

144,

043.

455,

884,

252.

226,

913,

299.

402,

608,

674.

8019

,352

,275

.58

1,40

6,51

6.49

Tons 2014 Tons 2045

2014

Ton

s

2045

Ton

s

* 2045 forecasts based on current flow patterns

Estimated and forecasted port volumes

Cabi

nda

Lobi

to

Luan

da

Nam

ibe

Poin

te-N

oire

Mat

adi

Lam

u

Mom

basa

Beira

Map

uto

Nac

ala

Pem

ba

Lude

ritz

Wal

vis B

ay

Dar E

s Sal

aam

Mtw

ara

Tang

a

Angola Congo DRC Kenya Mozambique Namibia Tanzania

-

20,000,000

40,000,000

60,000,000

80,000,000

100,000,000

120,000,000

638,123 3,181,173

10,533,246

932,195 5,210,213

2,090,854 1,603,397

22,795,240

8,086,893

23,150,283

4,493,469 857,342 301,753

4,226,363

12,606,221

832,625 1,629,715 834,679 4,138,504

13,764,962

1,418,169 6,959,870

3,259,675 1,931,342

29,244,907

10,473,066

30,426,823

11,448,956

1,306,086 433,854 5,986,498

17,628,437

1,149,133 2,297,021 2,714,890

14,352,074

45,946,926

19,238,974 23,841,459

16,515,725

4,945,395

95,774,216 94,729,234 90,485,346

46,183,566

7,451,912 1,980,418

26,992,860

69,109,600

5,032,671 10,850,735

2014 2020 2045

Tonn

es

82

24

17

101 239 29 85

* Port volumes exclude oil and gas exports

Trade flows - now and future

Trade flows - now and future

Rail potential of commodities

C o al M i n i n gI r o n O r e

M a g n eti t eR o c k P h o s p h a t e

S u l p h u rM a n g a n es e

C h r o m eC em en t

F er ti l i z erG y p s u m

F er r o a l l o y sW h ea t

F l u o r s p a rI r o n & S t eel

M a i z eC o p p er

N o n - F er r o u s M et a l P r o d u c t sS a l t

O t h er N o n - F er r o u s M et a l sC h em i c a l s

O t h er M i n i n gS t o n e, G r a n i t e , L i m es t o n eM o t o r v eh i c l es a n d t r u c k s

C o tt o nG r a i n S o r g h u m

O t h er P et r o l eu m P r o d u c t sS o y a b ea n s

B a r l eyP r o c es s ed F o o d s

M o t o r V eh i c l e P a r t sF u el r efi n ed

B ev er a g esS o y a b ea n p r o d u c t s

R i c eA n i m a l f eed

To b a c c o P r o d u c t sM et a l p r o d u c t s & E l ec t r o n i c s

S c r a p m et a l sO t h er M a n u f a c t u r i n g

P a p erP u l p o f wo o d a n d p a p er

W o o d ti m b er a n d p r o d u c t sTex ti l e P r o d u c t s

S u n fl o wer S eedO t h er A g r i c u l t u r e

G a s

92%90%90%

90%63%

60%60%

52%51%

51%50%

49%48%

47%46%

44%43%

43%42%42%

40%40%

34%34%

31%30%30%30%30%

29%29%

25%25%25%25%25%

21%21%21%21%20%

19%16%

14%13%

5%

Rail potential 2014

Country2014

Total tonnes (m)

Potential rail tonnes (m) Rail potential

Angola 161.1 9.7 6.0%Botswana 20.1 5.4 27.0%Burundi 10.4 0.8 7.7%Congo 34.8 3.1 8.9%DRC 57.9 6.8 11.8%Kenya 64.7 11.9 18.5%Lesotho 4.9 0.9 18.5%Malawi 27.6 3.8 13.8%Mozambique 55.7 10.0 18.0%Namibia 14.1 3.1 22.4%Rwanda 19.4 2.0 10.2%Swaziland 14.1 2.6 18.5%Tanzania 65.1 10.0 15.4%Uganda 51.4 6.0 11.7%Zambia 37.1 7.1 19.0%Zimbabwe 26.7 6.9 25.9%

Rail potential 2045

Country2045

Total tonnes (m)

Potential rail tonnes (m) Rail potential

Angola 575.4 51.5 8.9%Botswana 106.7 56.4 52.9%Burundi 28.0 2.2 7.7%Congo 113.1 12.1 10.7%DRC 287.4 43.0 15.0%Kenya 201.7 37.5 18.6%Lesotho 15.4 2.9 18.9%Malawi 114.0 16.9 14.8%Mozambique 365.5 91.7 25.1%Namibia 62.0 14.8 23.8%Rwanda 98.7 12.1 12.2%Swaziland 38.6 8.5 21.9%Tanzania 342.6 55.5 16.2%Uganda 249.8 38.2 15.3%Zambia 143.4 28.7 20.0%Zimbabwe 124.3 59.0 47.5%

Thank you

david@gaingroup.co.za

“The reality about transportation is that it's future-oriented. If we're planning

for what we have, we're behind the curve.”

- Anthony Foxx