Secretary General, PMAESA US/AFRICA Workshop on Developing sustainable Transportation Systems 26-27 August 2009 Increasing Port capacity Jerome Ntibarekerwa, Secretary General, PMAESA

CONTENTS INTRODUCTION OF PMAESA CORRIDOR PARTNERSHIP FACTOR OF TRAFFIC GROWTH PORT IN THE REGION :Global picture& regional picture PORT CAPACITY AND ITS EFFICIENCY KEY CHALLENGES IN PORT AND INLAND WATERWAYS TRANSPORT GLOBAL CHALLENGES CARGO HUNDLY PREFORMANCE

Introduction Who we are? Port Management Association of Eastern & Southern Africa (PMAESA) is a regional grouping of ports in the eastern and southern Africa with membership composed of state representatives and private sector from: Port Authorities Maritime transport departments Port Operators Maritime regulators

PMAESA Member States Angola Burundi Djibouti Ethiopia Eritrea Kenya Madagascar Malawi Mauritius Mozambique Namibia Rwanda Seychelles South Africa Sudan Tanzania Zambia Zimbabwe

Introduction What we do Established in 1973 under the auspices of the UNECA with the following objectives among others: Offer platform to exchange ideas and information where members can interface with one another in transport and trade facilitation Assist port development by enhancing productivity and service delivery and trade facilitation; Establish linking from ports to transport Corridors; To assist our ports /maritime members to implement IMO conventions Establish and maintain relations with other development partners and transport authorities for the study of matters beneficial to members

Ports Corridor Partnerships PMAESA ports facilitated a volume of 259.1 million tons of cargo in 2006 up from 238.3 million tons in 2005, indicating 4.3% growth Nine transit corridors provide linkage and flow of traffic to and from the ports in the region: Northern Corridor Central Corridor Djibouti Corridor The Trans-Kalahari Corridor The Maputo Corridor The Durban Corridor

Factors driving traffic growth in the PMAESA region External Factors: Strong GDP expansion Integration of regional economies with Asian suppliers Political stability Internal factors: Privatization of ports sector - increased investment Improved shipping links with Asia Increased ship size and transshipment Terminal productivity increases Above factors are increasing pressure on port capacity

Global container port capacity has reached critical levels North Europe 80.5% / 73.2% Eastern Europe 92% / 73% North America 92% / 86% South Europe 82% / 78% Far East 109% / 105% Middle East 98% / 89% Central America & Carribean 82% / 73% Subcontinent 87% / 57% South East Asia 108% / 91% Africa 79% / 71% South America 111% / 102% Oceania 105% / 93% Global Total 99% / 89% Source : World Bank , SSATP

Port congestion regions Courtesy of Michel Donner, World Bank State of the Port Sector 2008

Port congestion: Global Picture The following factors have impacted negatively on ports capacity globally: Global container port throughput has grown substantially in the last few years Growth in transshipment more rapid than Direct import/export Increase in hub-and spoke distribution of containers; Increase ship size. Over 70% ships ordered over 7000 TEUs Empty containers represent over 20% Lead time for delivery of STS now close to 2 years

Port congestion: Global Picture (cont..) The origin of port congestion is complex to identify, is related to: Inadequate physical capacity and insufficient productivity Inadequate information technology systems Cumbersome and bureaucratic cargo clearing systems Shortage of adequate storage areas Clogged access way to the port and saturated inland connections Inefficient inter-modal cargo flow/ network of rail & road transport Seasonal congestion – export commodities Administrative slow-downs and bottle-necks

A regional picture Economic growth and stability in the South East and Central Africa region Some of our Ports strategically placed regionally. Ongoing Improvement of road infrastructure Transshipment cargo for Island Regional economies Political stability

Responding to Port Congestion Two main ways to address increasing problem of congestion: Improve efficiency Develop additional capacity

Tackling Congestion Along the Logistics Chain Port of Entry Rail Transit Multimodal Transfer Road Transit Border Crossing Check Points International Transit National Transit Final Clearance Mode

Port capacity What are the determinants of port capacity? Vessel access Berth access Terminal capacity Storage density – containers per acre Gate capacity Inland transport capacity Swift modal transfers are key to intermodal operations Ports do not typically control some of the key drivers E.g. Peaking – periodic increases in activity Bunching of vessels which can create inefficiencies Since the 1990’s, governments have sought private sector involvement both for capital and operational experience But … In Africa some 70% of the (container) port operations are still run by the public sector

Tackling Congestion Along the Logistics Chain Port Rail Road Road transit Borders ICDs Destination Key players Customs Terminal operator Clearing agents Rail operator Truck operators Drivers Police ICD Operators Firms Issues Volumes Capacity Performance Dwell time Delays Truck utilization Checkpoints Axle load Transit times Time and money cost Emphasis should be on total logistics chain smallest capacity determines maximum capacity

Key challenges of our ports Acquiring more spaces for port activities Infrastructure development :Purchasing of new equipments Using ICDs Developing IT systems and free port activities Restructuring the management model Improving safety, security and environment protection to meet international standards

Challenges with Growing Demand: Key ports in the region Key ports in the Eastern and Southern Region: Kenya Ports Authority Tanzania Ports Authority South Africa , Transet NPA Djibouti port , DP World Sudan port Cooperation

Challenges with Kenya Ports Authority The rapid increase of traffic is likely to continue The container Dwell time is yet to be reduced The hinterland rail connections remain inefficient More dependence on road mode of transport with 3 axle road rule constraint for hauliers Long documentation procedures Inadequate capacity to handle the forecasted cargo volumes;

Challenges with Kenya Ports Authority (Cont) The exploration of Oil in Lamu District The Regional Integration expectations : EAC/COMESA Customs Union expected positive results The Transport Sector Reforms : Concession of RVR, Rehabilitation of major roads links to other countries

Challenges with Djibouti Ports The throughput in TEU has grown by 31% in 2007 while the General Cargo grew by 44% The stripping operations by Freight Forwarders remain very slow The yard is occupied at 95% There is a high level of stacking ( up to 5 highs) The number of full and empty containers is very high The port is facing many difficulties linked with Ethiopian bureaucracy as 85% of the total handled cargo is for Ethiopia

Challenges with Tanzania Ports Authority The insufficient container storage space The long container dwell time (has reached 25 days in Aug.2008) The rapid increase of container traffic and The low performance of inland modes of transport especially the rail lines with very low availability of wagons and locomotives.

Challenges with Tanzania Ports Authority (Cont) More investment to increase container terminals capacity and Inland Depot Improve efficiency and productivity within the existing port infrastructure and equipment Continue to involve private sector in port operations and concessioning which will improve port development

Challenges in South Africa (TRANSNET NPA) Responding to the opportunities presented by : Growth in global economic activity - increase inter/intra African trade Link industrial and mining sector activity to markets Alternate logistic & hub – South S trade Regional economic integration – Transport corridor development Intermodal harmonisation to improve regional supply chain and reduce logistics costs

Challenges with Sea Port Corporation – Sudan To cope with technological advances in maritime industries To face the political and economical challenges internally and externally: Requirements of WTO,COMESA agenda Exploration of Sudanese Oil, To handle economic activities logistics after Peace Agreements in Sudan.

Global Challenges : Port and Inland Waterways Development of Hub Ports & Spoke Routes Use of containers and shift to larger vessels led to creation of hub ports and spoke routes Hubbing reduces transport cost and time, increases efficiency of terminals and leads to predictable schedules Promotes transhipment, port development and competition Traffic is dominated by large efficient container terminals Driven by globalization – desire to serve all customers and markets High Technology – large vessels and computerized operations systems

Challenges in ports and Inland waterways Other Factors are: Environmental Pollution control Waste management plant Contingency plans, etc Dgerdding Sardregging etand Security Anti-terrorism safeguards Container security initiative Regional and bilateral security and safety coordination Surveillance systems

Challenges in management of Inland Waterways transport Strengthening institutional capacity for management of our waterways transport ; Harmonsation of policies , legislation and regulatory standards ; Pollution control and prevention ; Rehabilitation of wastewater treatment Facilities ; Pollution risk management and safety of navigation Community capacity building and participation

Challenges in the Globalization of Maritime Transport Services Pertinent issues in PMAESA Ports Physical limitation and constraints Nautical Restriction – Most ports are Length & Draft restricted Lack of Navigation aids at night Piracy in territorial waters and at anchorage has not been eliminated Handling Equipment and Productivity: Few ports are well equipped with adequate gear to load/discharge Panamax & post-Panamax vessels Geared container and conventional vessels are expensive Productivity of Gantry cranes is consequentially low at 20 moves/hour Poor performance due to lack of maintenance

Comparative Review with key PMAESA Ports In terms of : Cargo handling performance Container handling performance Transit traffic Transshipment traffic Port regulation model Other safety and security arrangements

Cargo handling performance (DWT “000”)   2003 2004 2005 2006 2007 2008 AVG. GROWTH RATE DJIBOUTI 5,868 5,594 5,435 5,489 7,470 9,379 6.9% KENYA 11,931 12,921 13,281 14,402 15,962 16,414 8.6% MAURITIUS 5,543 5,816 5,602 5,686 7,040 7,420 8.3% REUNION 3,435 3,891 3,765 3,947 4,214 4,286 9.1% S. AFRICA 171,621 168,751 173,555 179,984 183,353 185,079 9.5% TANZANIA 5,481 5,416 6,864 7,291 7,427 7,421 8.9% Note: Figures shown are in calendar year Source: PMAESA

Cargo handling (cont) Ports in South Africa handle more cargo than other in the region They are followed by Mombasa, Dar Es Salaam,Djibouti , sudan and Mauritius

Container handling PORT T E U s ANNUAL GROWTH 2005 2006 2007 2008 VOL % DURBAN 1,899,065 2,198,600 2,479,232 2,642,165 162,933 7.4 CAPE TOWN 690,895 782,868 764,005 767,501 3,496 0.4 MOMBASA 436,671 479,355 585,367 615,733 30,366 6.3 PORT ELIZABETH 369,759 392,813 422,846 423,885 1,039 0.3 DAR ES SALAAM 287,948 256,391 333,980 373,548 39,568 15.4 DJIBOUTI 195,250 224,896 294,902 356,462 61,560 27.4 EAST LONDON 49,338 38,308 41,986 57,418 15,432 40.3 RICHARDS BAY 5,179 4,191 4,021 9,350 5,329 127.2

Container Handling Durban: handling to one third of the entire region’s shares of container traffic and maintaining the high profile and dominant position in the region East London and Mossel Bay recorded notable cargo increase of 8,2% and 10% East Africa, Mombasa posted a modest growth of 5,2%in 2008 compare to 22.1% in 2007 (global economic impact ) Dar port with only 11.8% growth in 2008 compare to 30.3% in 2007

Container Handling ( cont…) Namport, with excellent performance : from 3.6mT in 2007 to 4,9mT in 2008 Mauritius , a regional transshipment in the Eastern African Indian ocean with 5,4% growth in total traffic and 10%in container traffic

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