East African Private Sector Initiative on Regional Integration Presented by Vassilis. K & A. Elmi
‘Development of the Maritime Industry
in the Region’
East African Private Sector
Initiative on Regional Integration
Presented by : Vassilis Kyriakis & A. Elmi.Ahmed
Advantages of Regional Integration
• Closer Trading Links.
• Economies of Scale.
• Built of Strength and Confidence.
• Incentive for the Government.
• Stable and Predictable Business Environment.
• Synergy as Vehicle for the Integration into the World
Economy (Information Exchange).
• Collaborated Interest and Benefit Rather than
Individual Defense and Advance.
Regional Integration in Numbers
• Trade within the EAC - Kenya, Uganda and Tanzania -
grew from $778Mn in 2004 to over $1Bn in 2006.
• Trade within COMESA stood at $7.8Bn in 2007, up from
$4.5Bn in 2002.
• Trade among countries in Africa as a whole, in 2006,
amounted to only 8.9% of their total exports.
• 51.2% of all Asian exports, in 2006, went to Asian
• 24.3% of all South and Central America exports, stayed
within that region.
• Synergy between Members of the Regional
Private Sector – Open Exchange of Information.
• Business Contracts Among Neighbouring
Countries - Increase of Business.
• Boost Poorer and/or Smaller Countries with very
• Regionally Organized-Trade Supporting-Private
Institutions, that Identify/Broadcast Information
on Regional Trade / Investment Opportunities.
African Shipping - Obstacles Ahead
• Non-open Registry Fleet, average age:
– 20.5yrs, against 12.2yrs for world fleet.
• Main Sea Routes:
– Asia / North America (Transpacific);
– North America / Europe (Transatlantic);
– Asia / Europe – Mediterranean;
• Sub-Saharan Africa - 34.5% of the total goods
loaded in Africa, or 2.1% of the worldwide cargo
• Sub-Saharan Africa – Loaded Goods 230mln tons
vs. Unloaded Goods 70mln tons (2008).
• Economies of Scale - Cost to Shipper – Large
Shipping Lines vs. Normal Liners.
Ports and Regional Trade
• Ports - Regional / International Trade Nodes.
• Efficiency of Ports:
–Level of Trade.
–Development of their Hinterlands
• Inefficient Ports:
–High Trade Cost Imposition.
–Import / Export Volume Reduction
Hinterland Import Volume Reduction.
• Location/good Market. At Red Sea, between Far East/Europe/Arabian Gulf/Africa.
• Dubai Port World Management.
• Ethiopia is a natural hinterland of Djibouti Port.
• IT efficient (Maximo, Navis and Sage).
• EDI System for Manifest Cargo.
• Safe place (CCTV) and secure implementation of ISPS code (Port Access System).
• Regular liner services connecting about 200 ports in 71 countries in the world.
• Good performance and high productivity.
• Good equipment and infrastructure facilities.
• Most centrally located port in the COMESA market (population 380 million people)
• Modern telecommunication and banking services.
• Close proximity to Djibouti FZ with many new companies.
A STRATEGIC PORT
1. Harmonized Shipping Policies
- Promoting Regional Fleet.
- Fostering Co-operation Between the Countries
of the Region.
2. Determine Common Positions on International
Maritime Policy and Define Strenuous Solutions
Through Regular Consultations.
3. Harmonize / Implement International Maritime
Objectives of a Maritime Co-operation
Objectives of a Maritime Co-operation
4. Bilateral / Multilateral Co-operation
– Between Maritime Administrations
– Operational Organizations Maritime
5. Maritime Transport / Port Operations Co-
operation Between the sub-Regions/Members.
6. Establishment of sub-Regional and National
Shipping Lines / Competitive Fleets.
A New Dynamic Player and Hub, in
the Global Shipping Industry
• Formation of Djibouti Flag (State Registry).
– Adopt appropriate National Marine Legislation.
– Active Presence in IMO / Adopt IMO Regulations.
– Appoint Specialized Bodies for a) Dealing with Flag
Matters and b) Surveying /Certification.
• Expansion of Maritime Services.
– Technical Inspections/Surveys/Management.
– Authorization for Certification Renewal
(Class, Flag, etc.).
– Repairs/Dry Dock (Economical, Social implications).
Piracy – Challenge for the Region’s
• RISK! High Insurance Premiums.
• High Insurance Premium High Transport
• High Transp/n Cost High Product Cost.
• Receiver/Supplier seek alternative roots.
• Piracy Control Price Control/ GROWTH!
"We need to strongly rethink our strategies
for development and use regional integration
- closer ties among African economies - to
promote and strengthen the current low
levels of intra-African trade.“ - UN Economic
Commission for Africa
"The time has come to enlarge our markets.“ -
Think BIG - The ‘Dubai’ of Africa(?)
Area: 4,114 Km2
– Geographical Position.
– Port / Trade.
– Real Estate.
– Financial Services.
37.2/km2 (space for infra/ture)
- Geographical Position.
- Port / Regional Trade.
- Red Sea Underwater World.
- Space for Development.