0
Mega Trends Driving Transport and LogisticsMega Trends Driving Transport and Logistics
in Subin Sub--Saharan AfricaSaharan...
Today’s Presenter
Sarah O’Carroll, Industry Analyst
Frost & Sullivan
Africa
2
2+ years of market intelligence and consulti...
Focus Points
3
1
2
4 Current state of transport infrastructure
Trade forecasts for Sub-Saharan Africa
Current state of cro...
Trade in Sub-Saharan Africa is estimated to triple over the
next two decades
240 617
45 181
4.6%
6.9%
2009
Trade Volume
(m...
Significant institutional and policy reform is required in
order to make Sub-Saharan countries competitive globally
Trade ...
Infrastructure development is the key driver for
improvements in the Logistics Performance Index
Key Trade Metrics
(1=low ...
Current State of Transport Infrastructure
Southern West East Central
Container dwell
times
4-8 days 11-30 days 5-28 days -...
Mega Trends Driving Transport and Logistics in Sub-
Saharan Africa
Future Infrastructure
Development
Regional Integration
...
Increasing Agricultural and Mineral Production Drive
Development
C
CC
C
B
B
B
Mineral Reserves, Africa
Uranium
Namibia, Ni...
$28 billion is being invested in the development of trade
corridors in Sub-Saharan Africa
Trans-African Railroads Trans-Af...
Trade Corridors offer several benefits in the long term
2
1
Enhance regional integration
Promote intra-African trade
Benef...
Major transport projects aimed at improving logistics
efficiency
$5.2 billion
Rehabilitation of railway
to improve transhi...
Conclusions
What does it mean in the
long term?
And in the mean time?
Links to mega Take advantage
Strategic sourcing
Impl...
Next Steps
Develop Your Visionary and Innovative Skills
Growth Partnership Service Share your growth thought leadership an...
Your Feedback is Important to Us
Growth Forecasts?
Competitive Structure?
What would you like to see from Frost & Sullivan...
Follow Frost & Sullivan on Facebook, LinkedIn,
SlideShare, and Twitter
http://www.facebook.com/FrostandSullivan
http://www...
For Additional Information
Sarah O’Carroll
Industry Analyst
Infrastructure
(021) 680-3280
Sarah.O’Carroll@frost.com
Kudzan...
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Mega Trends Driving Transport and Logistics in Sub-Saharan Africa

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Transport infrastructure is a key facilitator for the efficiency of a company’s supply chain. Due to significant improvements in transport infrastructure within Sub-Saharan Africa, logistics in the region should also see positive impacts. This briefing will investigate transport infrastructure development in Angola, Ghana, Kenya, Nigeria, Mozambique and Tanzania, and its impact on the logistics market.

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  1. 1. Mega Trends Driving Transport and LogisticsMega Trends Driving Transport and Logistics in Subin Sub--Saharan AfricaSaharan Africa Trade Corridors Spur Regional IntegrationTrade Corridors Spur Regional Integration Sarah O’Carroll, Industry Analyst InfrastructureInfrastructure © 2012 Frost & Sullivan. All rights reserved. This document contains highly confidential information and is the sole property of Frost & Sullivan. No part of it may be circulated, quoted, copied or otherwise reproduced without the written approval of Frost & Sullivan.
  2. 2. Today’s Presenter Sarah O’Carroll, Industry Analyst Frost & Sullivan Africa 2 2+ years of market intelligence and consulting experience in cross industries such as infrastructure, water and wastewater and facilities management. Particular expertise in conducting growth consulting studies and developing market entry and geographic expansion strategies.
  3. 3. Focus Points 3 1 2 4 Current state of transport infrastructure Trade forecasts for Sub-Saharan Africa Current state of cross border trading Current state of logistics 3 5 Development drivers6 Trade Corridors in Sub-Saharan Africa7 Conclusions8 Mega Trends driving transport and logistics
  4. 4. Trade in Sub-Saharan Africa is estimated to triple over the next two decades 240 617 45 181 4.6% 6.9% 2009 Trade Volume (million tons) 2030 Trade Volume (million tons) CAGR (%) Southern Africa East Africa Demand for consumer goods Mineral and agricultural production 4 Source: Frost & Sullivan Analysis Efficient transport and logistics systems are crucial to ensure that trade volumes are achieved 7 300 21 77 19.6% 6.4% Africa West Africa Central Africa Infrastructure development Demand for raw materials
  5. 5. Significant institutional and policy reform is required in order to make Sub-Saharan countries competitive globally Trade across borders ranking (185 economies, 1=most efficient trading) Burden of customs procedure (1=extremely inefficient, 7=extremely efficient) Documents to export Documents to import Time to export (days) Time to import (days) Cost to export ($/container) Cost to import ($/container) Singapore 1 6.2 4 4 5 4 $456 $439 Brazil 123 3.1 7 8 13 17 $2,215 $2,275 Russia 162 2.9 8 11 21 36 $2,820 $2,920 India 127 3.8 9 11 16 20 $1,120 $1,200 China 68 4.2 8 5 21 24 $580 $615 Global Competitiveness 5 South Africa 115 4.3 6 7 16 23 $1,620 $1,940 Angola 164 2.7 11 8 48 45 $1,850 $2,690 Ghana 99 3.4 7 7 19 34 $815 $1,315 Kenya 148 3.4 8 7 26 26 $2,255 $2,350 Mozambique 134 3.5 7 10 23 28 $1,100 $1,545 Nigeria 154 3.6 10 10 24 39 $1,380 $1,540 Tanzania 122 3.4 6 10 18 31 $1,040 $1,565 Although West Africa performs poorly overall, Ghana is currently the most efficient trading economy. Source: Frost & Sullivan Analysis
  6. 6. Infrastructure development is the key driver for improvements in the Logistics Performance Index Key Trade Metrics (1=low and 5=high) Singapore South Africa Angola Ghana Kenya Mozam. (2010) Nigeria Tanzania Logistics performance index: Overall 4.13 3.67 2.28 2.51 2.43 2.29 2.45 2.65 Efficiency Trend (2007-2012) - ▲ ▼ ▲ ▼ - ▲ ▲ Ability to track and trace consignments 4.07 3.83 2.00 2.31 2.34 2.28 2.35 2.77 Competence and quality of logistics services 4.07 3.56 2.00 2.68 2.38 2.2 2.52 2.64 Ease of arranging competitively Efficiency of Logistics (2012) 6 Ease of arranging competitively priced shipments 3.99 3.50 2.26 2.81 2.69 2.77 2.60 2.91 Efficiency of customs clearance process 4.1 3.35 2.33 2.33 2.08 1.95 1.97 2.17 Frequency with which shipments reach consignee within scheduled or expected time 4.39 4.03 2.59 2.76 2.88 2.4 2.92 2.97 Quality of trade and transport- related infrastructure 4.15 3.79 2.48 2.05 2.16 2.04 2.27 2.41 In low-to-middle income countries, improvements in infrastructure can improve the LPI by as much as 10%. Improvements of services from logistics companies and customs have a lesser impact. Source: Frost & Sullivan Analysis
  7. 7. Current State of Transport Infrastructure Southern West East Central Container dwell times 4-8 days 11-30 days 5-28 days - Truck cycle times 2 to 12 hours 6 hours to more than one day 3.5 hours to one day - Freight transported by rail 85% 11% 2% 2% Key Transport and Logistics Infrastructure Metrics, Sub-Saharan Africa, 2010 7 Source: World Bank and Frost & Sullivan Analysis by rail Average travel speed 11.6 km/hr 6.0 km/hr 8.1 km/hr 6.1 km/hr Road trade density 27.9 $ million/km 8.2 $ million/km 5.7 $ million/km 4.2 $ million/km Roads in good condition 100% 72% 82% 49% Southern Africa outperforms the rest of the region; infrastructure is in good condition, ports are more efficient and railways are utilised.
  8. 8. Mega Trends Driving Transport and Logistics in Sub- Saharan Africa Future Infrastructure Development Regional Integration Mega Cities and Mega Regions 8 Rapid urbanisation across the African continent will result in the development of mega cities and mega regions. In order to increase global competitiveness, the development of multimodal transport networks will become a necessity. Regional integration will unlock economic potential of landlocked countries leading to better inter-dependence among cities and regional growth.
  9. 9. Increasing Agricultural and Mineral Production Drive Development C CC C B B B Mineral Reserves, Africa Uranium Namibia, Niger, Botswana, Zambia and Tanzania Coal South Africa, Mozambique and Botswana Iron Ore Sierra Leone, Guinea, Liberia and Rep of Congo Copper Zambia, DRC and Rep. of Congo Mining Projects in Africa 9 Source: World Bank and Frost & Sullivan Analysis C B Bauxite Uranium Gold Copper Diamonds Oil Gas Timber Main Reserves Iron Ore Coal CC C C Agriculture Projects in Africa Tobacco Malawi, Zambia Forestry Mozambique Sugar Malawi, Mozambique
  10. 10. $28 billion is being invested in the development of trade corridors in Sub-Saharan Africa Trans-African Railroads Trans-African Highways Current rail networks in Trans-African 10 Source: Frost & Sullivan Analysis Sub-Saharan Trade Corridors are currently hindered by a significant lack of connectivity, and operational unreliability networks in SSA are predominantly in a poor or disused state Trans-African Highways lack connectivity in central Africa
  11. 11. Trade Corridors offer several benefits in the long term 2 1 Enhance regional integration Promote intra-African trade Benefits of Trade Corridors: 3 Create access to new markets 11 Source: Frost & Sullivan Analysis 4 5 6 Support regional economic growth Reduce the burden on roads Decrease transport and logistics costs 3 Create access to new markets
  12. 12. Major transport projects aimed at improving logistics efficiency $5.2 billion Rehabilitation of railway to improve transhipment $5.3 billion Construction of a new port in Northern Kenya $2.23 billion Railway linking Tanzania to Rwanda $1.4 billion Tema-Accra railway link 12 *basedonactiveprojectsin2011 $1.2 billion Increase port capacity from 2.7 to 11.0 million tonnes $2 billion 900km railway linking port of Nacala to Moatize $9.34 billion 1,100 km railway linking Botswana to Mozambique via Zimbabwe , new port at Matatuine $6 billion Development of a new deep sea port Source:Frost&SullivanAnalysis
  13. 13. Conclusions What does it mean in the long term? And in the mean time? Links to mega Take advantage Strategic sourcing Implement Best-In-Class 13 Improved regulations and procedures Links to mega cities and mega regions Access to new markets Reduced costs and transport times Take advantage of the challenges to do business better than your competitors Route-to-market Operational efficiency
  14. 14. Next Steps Develop Your Visionary and Innovative Skills Growth Partnership Service Share your growth thought leadership and ideas or join our GIL Global Community 14 Join our GIL Community Newsletter Keep abreast of innovative growth opportunities
  15. 15. Your Feedback is Important to Us Growth Forecasts? Competitive Structure? What would you like to see from Frost & Sullivan? 15 Emerging Trends? Strategic Recommendations? Other? Please inform us by “Rating” this presentation.
  16. 16. Follow Frost & Sullivan on Facebook, LinkedIn, SlideShare, and Twitter http://www.facebook.com/FrostandSullivan http://www.linkedin.com/companies/4506 16 http://twitter.com/FrostsullivanSA http://www.linkedin.com/companies/4506 http://www.slideshare.net/FrostandSullivan
  17. 17. For Additional Information Sarah O’Carroll Industry Analyst Infrastructure (021) 680-3280 Sarah.O’Carroll@frost.com Kudzanayi Bangure Programme Manager Infrastructure (021) 680-3207 Kudzanayi.Bangure@frost.com 17 Guillaume de Bassompierre Sales Manager Infrastructure (021) 680-3582 Guillaume.Bassompierre@frost.com Samantha James Corporate Communications Africa (021) 680-3574 Samantha.James@frost.com
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