Sky handling partner Ltd cargo terminal business plan slide share

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SKY HANDLING PARTNER Ltd CARGO TERMINAL
Freetown International Airport - Lungi
BUSINESS PLAN
2016 – 2019
©Thierry JOLAINE

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Table of Contents
I Executive Summary ............................................................................. p 3
II Socio-economic Environment ..................................................................p 9
III Products and Services ...........................................................................p 25
IV Marketing Plan .......................................................................................p 51
V Operational Plan/ Management and Organization .................................p 61
VI Financial Plan (Missing for confidentiality)..........................................................p 65
VII CONCLUSION..........................................................................................p 79
I Executive Summary

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As a part of its economic reform program and the desire for public participation in productive airport
activities, the SLAA has undertaken a reorganization of ground and cargo handling services at the Freetown
international Airport.
The SLAA decided to concede to a private operation with technical and financial capacity, the ground
and cargo handling service activities at the Freetown International Airport. After the bid evaluation exercise,
SLAA declared the company Groupe Europe Handling as the successful tender.
They commenced negotiations with the company to define the main terms and conditions of the
concession agreement and to define the schedule tasks until the entry of operation of the company to set-
up an agreement has been drawn-up.
Groupe Europe Handling incorporated a new company governed by the laws of Sierra Leone to be
called SKY HANDLING PARTNER SIERRA LEONE or SHP SL in order to operate the concession right granted by
the agreement as sole Handler on the Freetown International Airport. The concession agreement was
signed on the 21st of October 2009 and the operation started from the 1st of April 2010 for a 20 years’
duration and, through an addendum to the contract, for 25 years.
Sky Handling Partner SL Ltd is owned 80% by Paris-CDG-based Groupe Europe Handling, and 20%
by Sierra Leone-registered S.A.P.
Groupe Europe Handling has other ground handling subsidiaries in Ireland (SHP Dublin and
Shannon),UK (SHP.UK),Congo (Congo Handling in Brazzaville ,Pointe-Noire and Olombo), Gabon (H.P.G. in
Libreville ,technical assistance), Dominican Republic ‘AAG) , and a franchise partner (ASAM, in Bamako and
all airports in Mali).Groupe Europe Handling is itself a subsidiary of Groupe CRIT Holding, listed on the Paris
Stock Exchange.
Groupe Europe Handling History :
Groupe Europe Handling and Sky Handling Partner activities:

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The original Business plan presented for the Concession agreement was as follows:
INVESTMENT PLAN 2010 - 2019 ( USD )
TOTAL AMOUNT FINAL TOTAL
EQUIPMENT & OTHER ASSETS
YEAR 1 TO 5 YEAR 5 TO 10
TOTAL XXXXXX XXXXXX XXXXXX
Finally , during the five first years of activity , the amount invested by SHP SL from April 2010 finally
reaches XXXXXX USD i.e. 67 % more than the five years business plan forecast (excluding investments for
the new cargo terminal not involved in the initial business plan).
Groupe Europe Handling (GEH) and Sky Handling Partner Sierra Leone (SHPSL) have been in the
process of establishing a modern cargo storage terminal from January 2012 to enable provision of adequate
cargo handling services.
For now cargo is handled and stored in an old 600 m2 warehouse, badly designed for handling
import and export freight.
Apart from the fact that the warehouse is too small and cargo is stored outside regularly, no
adequate cargo facilities - like cold storage, dangerous goods storage, weighing and security equipment - are
available. As a result, import possibilities are limited, and some airlines have put Freetown International
Airport under embargo for export, mainly due to the lack of security checks for export goods.
SHP SL will contract and train employees and will implement the IATA Safety Audit for Ground
Operations (ISAGO) standards and also match the EU ACC3/RA3 regulations.
The project will have a massive impact on the local economy, as it provides the first airport import
and export facilities up to international standards.
The joint venture signed a long-term land lease agreement with the airport authorities. The design
and engineering plan for the cargo terminal was finalized and a construction license was granted. An
Environmental Impact Assessment was carried out. The training program and Handbook were updated and
the joint venture applied for MIGA insurance was done successfully.
Construction works have started later than originally planned. Due to the elections on 17 November
2012, the SHPSL’s local shareholders advised not to proceed with the advance payment for the construction
company, which is majority owned by leading individuals of the opposition party, before the election date.

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As such, construction works only started early 2013. The construction process was going well,
although it is going slower than expected. One of the reasons is that SHPSL has engaged Bureau Veritas for
regular quality control checks, and these visits sometimes interrupt the process somewhat.
At that time, construction works were supposed to end by mid-2014. Unfortunality the Ebola
Outbreak first case has been recorded on the 27th of May 2014 and ended officially on the 7th of
November 2015.
GEH and SHP endeavored to the best of their ability to maintain their services at the Freetown
International Airport during and after the outbreak. To substantiate this undertaking, capital-intensive
investment packages are still being undertaken even during this period vis-à-vis construction of a state-of-
the-art cargo terminal building, procurement of a Ground Power Unit (GPU), ramp equipment and
Transporter for cargo. In SHP’s endeavor to contribute to the fight against Ebola, it prefers to reduce the
working hours and salaries instead of laying-off staff. Currently GEH and SHP maintain 230 Sierra Leonean
employees with full medical coverage for each employee and spouse plus four other dependants.
Furthermore Sky Handling Partner has gone ahead preemptively to sensitize all their staff and other airport
stakeholders and the community at large through movie projections, meeting, leaflets and Ebola DVD
documentary distribution. Finally due to the good results registered in 2014 and the full commitment of the
staff, the cut of salaries has been offset and the Christmas Bonus maintained.
As referred in the last report of the Bureau Veritas (Progress Report of Works “Updated
News from Site N° 14”, 21st
of April 2014 ): “The inauguration date of the terminal is planned for the
29th of April 2014” .
At that time the Ebola Outbreak already hit Guinea and the first EVD case was registered on the 7th
of May 2014, leading to an immediate stop of the works to be achieved. As borders were closed with Ivory
Coast for instance, missions of Bureau Veritas (in charge of control and also leading the project) have been
cancelled, as the head office of Veritas is located in Abidjan. Most of the international airlines stopped their
flights with an immediate effect on the passenger traffic:

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But on the same time the Cargo traffic has been boosted by the flood of material and equipment
triggered by the mobilization of the International Aid:
In November 2014 the cargo tonnage reaches a peak of 2536 tons handled by SHP SL i.e. more than
a half of the previous total year traffic (4400 tons) in one month and 10 more than in November 2013. This
peak was mainly due to the stop of operations in the sea port which resume mid-December. Despite our old
Cargo Shed, professionalism and efficiency of the SHP SL staff and equipment has been highlighted working
7/7 and 24/24 in those difficult circumstances (wear of protective suit for instance) :
4500
9500
14500
19500
24500
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR
2013-2014 2014-2015
Passenger traffic evolution
277
2 356
200
700
1 200
1 700
2 200
2 700
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR
2013-2014 2014-2015
Cargo traffic evolution in Tons

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After the stress due to this intense period of operation essential for the country and despite the
absence of overseas staff available (Veritas from Ivory Coast, Dagard (cold rooms) from Senegal for instance),
SHP SL succeed in resuming works in the new Cargo Terminal relying on local companies for the final phase
of works with a new planning, aiming an opening at the end of the year 2015. Facing the lack of will and
financial means of SLAA, SHP SL took responsibility for all the access road and surroundings; the final phase
included also the completion of the floor with Epoxy before the fitting of pallet racking, X-Ray machines and
the electronic scale. (All that equipment was already available on site).
We finally succeeded in meeting the deadline.

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Pictures taken on the 22nd
of November 2015 with Epoxy completed
On the same “front” and despite the drop in his 2015 revenue (as a result of the Ebola
Outbreak) SHP SL managed to build, furbish and open on the 28th
of November a modern business
lounge in the Lungi International Airport .

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II Socio-economic Environment
As our activity is extremely correlated to the economic health of the country, we think it is necessary
to make a deep analysis of the economic situation and its main components to explain the past, the present
and the future development of our business. We will divide our analysis in two parts; firstly the pre-Ebola
situation and secondly the post-Ebola evolution. In fact the Ebola Outbreak is the breaking point, we have to
consider to evaluate the future of our business but some facts before this period stressed the weakness of
the incredible growth of the Sierra Leonean economy until 2013 .
a) Pre Ebola economic situation.
Sources: ECONOMIC AND FINANCIAL SURVEY 2014 (Economic Statistics Division Statistics Sierra Leone)
West African Countries experienced faster recovery from the 2009 financial crisis as GDP growth rate
was on average above 3% from 2009 to 2011.
Sierra Leone experienced accelerated economic growth in 2013 as real GDP grew by 15.2% in 2012
and 20.1% in 2013 which made Sierra Leone one of the fastest growing economies in the developing world.
This growth was triggered mainly by the mining industry, especially with the commencement of large scale
iron ore production, as well as developments in Agriculture and Services sectors. When Iron ore production
was excluded from the mining industry, GDP growth rate attained was 5.3% and 5.8% in 2012 and 2013
respectively.
Source: IMF (2013), World Economic Outlook
Notwithstanding the numerous economic challenges SSA countries faced, they helped to spur
world economic growth as their output increased by 4.9 in 2012 and 5.0% in 2013. It is believed that
such a strong growth was achieved mainly from expansion of the extractive industry as well as the
production and export of primary agricultural products such as cocoa and coffee. There are concerns
however, that such a growth is not inclusive enough as unemployment, and especially youth
unemployment and poverty are still widespread in SSA countries.
Agriculture which is the main sector of the economy, contributed more than 40% of GDP from 2009
to 2013. The output of the Agriculture sector continued to grow since 2009.
0,0
5,0
10,0
15,0
20,0
25,0
2010 2011 2012 2013
5,6 5,5 4,9 5,0
8,0 7,4 6,6 6,2
8,9
6
15,2
20,1
Sub-Saharan Africa Nigeria Sierra Leone
GDP Growth (%)

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Agricultural output grew in real terms by 3.8% in 2012 and 4.6% in 2013 which repressed main
expansion of agricultural activities in 2013.
Figure 2.1.1: Average Annual Growth Rates of Agriculture and Fishing GDP at 2006 Prices
However growth in the sector slowed down to 3.8% in 2012 partly due to the slow pace in
implementing the ‘Small Holder Commercialization Program (SHCP) policy of the government, which
aimed at expanding land under cultivation, creating markets for farmers and value addition through
processing and storage of agricultural products. SHCP implementation was enhanced in 2013 and
famers benefited immensely through the Agricultural Business Centers (ABCs) which in turn boosted
Agricultural production and hence the industry grew by 4.6% in 2013.
Crop, especially rice, is the main contributor to this output; forestry activity is expanding but at a much
slower rate when compared with the other activities like livestock and fishery partly due to the informal
nature of transactions in the forestry sector. The ban on commercial timber exporting since 2008
compounded the problems of forestry activities in the country.
Fisheries
Statistical data on Fisheries shows that it is not all the quantity of fish captured that are landed;
some of the captured fishes are transshipped on the high sea from trawlers owned by registered Fishing
Companies in Sierra Leone to vessels owned by diverse fishing merchants in the international world.
So the phenomenon of transshipment generally applies only to industrial fishing since all the fishes
captured by artisanal fishermen are landed on shore.
The quantities of fish production landed on shore by artisanal fishermen were 85.6%, 90.0%, 92.5%,
92.3%, 92.1%, 92.1% and 92.1% in 2007, 2008, 2009, 2010, 2011, 2012 and 2013 respectively.
The marginal difference is the quantity of fishes landed by Industrial Fishing. This is a clear evidence to
believe that the bulk of the quantity of fishes captured by the registered Industrial Fishing vessels is
being exported to the international world.
Also, it is important to note that export of artisanal fishing amounted only to 0,2 % of the total artisanal
fish production landed in 2013 respectively.
The Industry sector which comprises mining and quarrying, manufacturing, construction and
electricity, water supply and other utilities accounts for about 8% of GDP. In 2012, the growth rate of the
sector increased astronomically by 127.6% due to the new production of iron ore and developments in
construction. The growth rate of the sector moderated to 94.3% in 2013.
Production of iron ores by AML (African Minerals) increased by 55.5% from 2013 to 2014 whereas
production by LMC (London Mining) decreased by 28.6% from 2013 to 2014 and total production for the
period under review increased by 30.9% from 2013 to 2014. Whereas annual diamond production by KHC
increased by 21.4% from 2013 to 2014, annual rutile, zircon production by SRL decreased by 30.9%, 36.7%

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and 21.9% respectively from 2013 to 2014. And annual bauxite production by SML increased by 80.4% from
2013 to 2014. Diamond production was largely dominated by artisanal mining from 2007 to 2011 in which
the contribution of artisanal mining to diamond production was 75.6, 95.1, 72.0, 76.2 and 73.3 percents
respectively from 2007 to 2011. But there was a change in 2012 when industrial mining of diamond
production occupied 54.6% and 50.7% in both quantity and value terms respectively. The expansion of
domestic output was driven largely by a rapidly growing mining sector, particularly the significant
scaling up of iron ore extraction. Excluding iron ore, GDP grew by 5.5% in 2013.
Another impact of mining sector is the impact on the Transport and Aviation sector linked with the
number of expatriates employed by the Large Scale companies:
Number of Expatriates hired by Industrial Mining Companies
Source: National Mineral Agency (NMA)
The Services sector contributed about 35% of GDP between 2009 and 2013. It grew by 6.1% and
6.0% in 2012 and 2013 respectively, supported mainly by developments in public administration, transport
and communication, trade, tourism and banking
Trends in Visitors Arrivals and Tourism Earnings, 2009-2013. Source: National Tourist Board
222
894
560
0
100
200
300
400
500
600
700
800
900
1000

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The Transport and Aviation sector posted a steady growth for the five year period. The sector’s
gross value added grew by 53.6% from 2009 to 2013. The air transport in relation to aircraft movement,
passenger movement, Freights and mails handled experience both an increase and a decline within the
five year period that can be attributed to the improvement of airport infrastructure and the arrival of
SKY HANDLING PARTNER as sole handler in April 2010. There was a drop in the Aircraft movement of
16.8% from 2009 to 2010. This sector also recorded an increase of 52.5% in the aircraft movement from
2010 to 2013. Freights handled at the Airport encountered a decline of 4.2% from 2009 to 2010, but
there was a huge increase of 216.0% from 2010 to 2013. Mail handled at the Airport also experienced a
decline of 15.9% from 2009 to 2010 but there was an increase of 108.0% from 2010 to 2012.
Conclusion:
The incredible growth of 20,1% of the GDP in 2013 was essentially based on the mining
industry. In 2013, the country recorded a positive growth rate of 124.6 % for mineral exports, while a
negative growth rate of -19.5% was recorded for agricultural exports. Furthermore, the percentage
share of mineral export in total export value increases from 70.6% in 2012 to 93.3 % in 2013, while for
that of agricultural exports it dropped significantly from 22.8% in 2012 to 5.3 % in 2013. In Sierra Leone,
the mining sector is now the engine of growth, with Iron Ore been the growth driver and account for
about 55.7% share of total export value in 2013.
Sierra Leone’s external transactions with the rest of the world showed an improvement with the
deficit in overall balance narrowing from US$194.25 million in 2011 to US$140.0 million in 2012,
primarily due to an improvement in the balance of the current account. The Goods and Services account
of the current account of the BOP both recorded a deficit in 2012.The current account deficit contracted
by US$ 811.4 million to US$ 1,102.09 million in 2012.Sierra Leone’s indebtedness to the rest of the
world shows an increasing trend as indicated by the country’s international investment position (IIP)
from US$ 0.69 billion in 2009, to US$ 0.94 billion in 2010, US$2.04 billion in 2011 and US$2.05 billion in
2012.
From Q2 in 2010 to Q4 in 2013, there has been improvement in the confidence index of
business operators of 4.1%. The Business Confidence Index in Q1 of 2011 was 60.4% and increased to
65.9% in Q4 of 2013.
Since the inception of the Sierra Leone Business Confidence Index, one affirmative outcome of
this study was that sentiments about future business outlook were higher than sentiments about
past/current business performance. The negative sentiments about Governance factors such as effect of
bureaucracy, effect of internal political climate, effect of corruption and effect of crime had immense
impact on both the medium and small scale size establishments.
0
50000
100000
150000
200000
250000
2006
2007
2008
2009
2010
2011
2012
2013
TOTAL Passengers in & out
SHP
2006
2007
2008
2009
2010
2011
2012
2013
TOTAL CARGO in tons in & out
SHP

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The main governance factors undermining business confidence in all the sectors were
bureaucracy, corruption and crime. The impact of internal political climate was manageable although
above normal. The focus of policy should therefore be to intensify the current efforts to reduce crime,
corruption and bureaucratic procedures on business operations in the country.
b) Post Ebola economic situation.
In 2014, the Sierra Leone economy had to face two major problems:
 The China’s economy slowdown leading to a drop in Iron ore production and prices.
 The Ebola Outbreak: The spread of the EVD outbreak was also observed on 27 May in
Sierra Leone, where it spread more rapidly than in the other countries and ended officially on
the 7th
of November 2015.
a) Iron ore production and Chinese economy impact :
In Sierra Leone, falling iron ore prices have lowered profits and reduced the market value of the
iron ore companies operating in the country (the collapsed London Mining and African Minerals). This
has led not only to lower foreign investments in the sector but also to the shutdown of operations in
Tonkolili (the second largest iron ore mine in Africa and one of the largest magnetite deposits in the
world).
AFRICA'S second-largest iron-ore mine, in Tonkolili, Sierra Leone, lies silent and still. The slump
in the price of iron ore and the Ebola epidemic killed off profits, and it was closed by African Minerals,
which owned it, last December. China’s state-owned Shandong Iron and Steel Group saw the closure as
an opportunity and snapped up the mine in April. Chinese firms, it seems, are buying into the market
while stocks are cheap.
The problem is that China already produces too much steel. The country already makes
almost as much crude steel a year as the rest of the world combined—822m tons in 2014—adding to
the current global glut. Chinese steel is at its lowest price in over a decade and most firms producing the
commodity in the country are loss-making. Rather than displacing the sector abroad, China needs to
shrink it.
There is a more favorable interpretation, however: these Chinese firms are taking a longer view
of Africa’s potential. African steel demand is expected to hit 300m tons per year by 2050, according to
Mysteel.net, a Shanghai-based trade publication. And an African source of iron ore and basic steel could
also give China a more stable supply to feed its industry, which is increasingly specializing in turning
these inputs into higher-quality metal. Chinese consumers used over half of the world’s iron ore in
2013. Over-dependence on Australia for iron ore led to a nasty sting in 2010 when the country's mining
duopoly, Rio Tinto and BHP Billiton, raised prices.
There is a further reason why China has to play the long game in African minerals. According to
Henry Tugendhat from the Institute of Development Studies, a think-tank, Chinese firms use a stick-at-
it-strategy because of their newcomer status. Whereas firms from Britain and France have roots going
back to African countries’ colonial days, Chinese firms have had to prove their reliability. They hope that
good behavior during a crisis—even if it loses them money in the short run—will secure them better
contracts in the future.

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187,18
39,6
0
20
40
60
80
100
120
140
160
180
200
2010-12-01
2011-02-01
2011-04-01
2011-06-01
2011-08-01
2011-10-01
2011-12-01
2012-02-01
2012-04-01
2012-06-01
2012-08-01
2012-10-01
2012-12-01
2013-02-01
2013-04-01
2013-06-01
2013-08-01
2013-10-01
2013-12-01
2014-02-01
2014-04-01
2014-06-01
2014-08-01
2014-10-01
2014-12-01
2015-02-01
2015-04-01
2015-06-01
2015-08-01
2015-10-01
2015-12-01
Iron ore fines price chart (01/12/2010-01/12/2015)

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All those graphics show clearly the full correlation between the drop of iron ore
production in Sierra Leone and its afferent resources and the China’s GDP growth and iron ore
consumption and the drop of prices.
0
50000
100000
150000
200000
2013
2014
2015
Volume of export from SL to China in thousands of $
0
500 000
1 000 000
1 500 000
2 000 000
2 500 000
janv.-13
juin-13
nov.-13
avr.-14
sept.-14
févr.-15
1 863 661
342 629
Iron Ore SL production
0
50 000
100 000
150 000
200 000
janv.-13
juil.-13
janv.-14
juil.-14
janv.-15
Diamond Rutile Bauxite
Diamond / Rutile / Bauxite SL production
0
5
10
15
2010
2011
2012
2013
2014
2015
2016
2017
10,5 9,3
7,7 7,7 7,4 7,1 7 6,9
CHINA GDP Growth (%)
Source: World Bank.

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b) The Ebola Outbreak effects and the National Ebola Recovery Strategy :
The Ebola Outbreak first case has been recorded on the 27th of May 2014 and ended
officially on the 7th of November 2015. During that period some 8,704 people caught the virus and
3,589 of them lost their lives.
The Ebola Virus Disease (EVD) outbreak in West Africa has the worst death toll since the disease
was diagnosed in 1976. It also has far reaching socio-economic consequences. Although the disease is
still unfolding, several studies on those impacts have been conducted this year, including those by the
World Bank, the International Monetary Fund (IMF), the World Food Program (WFP) and the Food and
Agriculture Organization of the United Nations (FAO). Country Reports have been prepared by United
Nations Country Teams (UNCTs) under the leadership of the United Nations Development Program
(UNDP) country offices and the World Health Organization (WHO).
Reflecting alarmism owing to the disease, as well as EVD-related mortality and morbidity,
economic activity has shrunk. This contraction reflects multiple cross-currents: falling sales in markets
and stores; lower activity for restaurants, hotels, public transport, construction and educational
institutions (also caused by government measures such as a state of emergency and restrictions on
people’s movements); and slowing activity among foreign companies as many expatriates leave, with a
knock-on felt in lower demand for some services.
The World Bank revised down its 2014 GDP growth forecast from 11.3% before the crisis to 8.9%
in decline for 2014, from 11.3% to 8% (IMF 2014b). Its forecast for 2015 is a 2.0% contraction,
contrasting starkly both with its own 8.9% forecast from before the EVD outbreak and with the 7.7%
forecast in October by the World Bank (2014). According to government officials (Government of Sierra
Leone 2014), panic buying, supply reductions, area quarantines and border closures pushed up the
inflation forecast for 2014 from 6.7% in June to 7.5% in August 2014. The September IMF figure put the
rise higher at 10% at the end of 2014, and predicted elevated inflation in 2015 (IMF 2014b). Containing
EVD led to rises in government spending and capital spending reallocated from other projects (such as
those earmarked for long-term growth), widening the fiscal deficit even if risks to debt or fiscal
sustainability are believed moderate. As in Liberia, there is some financial sector fragility owing to
stemming from increasing non-performing loans. The balance of payments is suffering because of
increased food and health-related imports. The IMF (2014) projects the balance of payments shifting
from a programmed surplus of $38 million before the crisis to a deficit of $72.4 million in 2014.

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In order to get the last development of the post Ebola Crisis, we will refer to the speech of DR.
KAIFALA MARAH the Minister of Finance and Economic Development, presenting The GOVERNMENT BUDGET
And STATEMENT OF ECONOMIC AND FINANCIAL POLICIES For the Financial Year, 2016 on the 6th
of November
2016 .This speech shows what will be the new guide lines of the government policy for the period 2016 – 2018
with a clear message: http://mofed.gov.sl/speeches/Budget%20Speech%202015%20Minister%20Copy.pdf
“Strengthening Resilience and Building a Diversified Economy”
This 2016 budget is submitted to some risks as underlined by the Minister:
“The implementation and execution of the programs, projects and policies announced in this budget
is predicated on the following assumptions:”
(i) the assumption of Ebola ending on November 7, 2015; (done)
(ii) the resumption of iron-ore mining, and return of other Foreign Direct Investments.
(iii) Maintaining a resilient zero Ebola infections:
Without a resilient zero infection rate, uncertainty in the economy will return. In particular, this may
delay the return of Foreign Direct Investment and the full resumption of key economic activities.
(iv) The non-resumption of iron ore production and export
will pose additional strain on the Budget in terms of revenue loss and further depreciation of the Leone;
(v) The slowing of the Chinese economy
and the consequent weak demand for primary commodities, including iron ore may hamper the
economic prospects.
(vi) Delays and untimely disbursement of donor funds
may also impact budget execution;
(vii) Delays in the enactment of the proposed 2016 Finance Bill
will negatively impact revenue mobilization and hence implementation of the budget;
(viii) Finally, any delay in the completion of the fourth review under the ECF by the Executive Board
of the IMF beyond mid-November 2015 will affect the disbursement of the augmented support of
US$67.7 million and the disbursement of budget support by other budget support partners.
The main purposes of this strategy have been defined as follows:
The National Ebola Recovery Strategy aims to put the economy back on the track of growth and
macroeconomic stability. The strategy focuses on three elements:
-20
-10
0
10
20
30
2013
2014
2015
2016
2017
20,1
6 -12,8
8,4
8,9
SL GDP Growth (%)
Source: World Bank.

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(i)getting to and staying at zero new cases; (ii) implementing immediate recovery priorities; and
(iii)transitioning back to our national development plan- the Agenda for Prosperity (A4P), 2013-
2018 .
The implementation of the strategy is, therefore, divided into two phases:
i. the immediate recovery phase (6-9 months) focuses on the priorities of getting to zero
infection rates, the re-opening of schools, providing social protection support to the
vulnerable such as Ebola survivors, orphans, widows and widowers as well as private sector
development, including agriculture, to support economic recovery;
ii. the medium term recovery (10-24 months) focuses on maintaining a resilient zero,
education, energy, water supply, social protection, and private sector development
consistent with the Presidential priorities for the recovery of the economy. The House of
Parliament may wish to note that the 2016 Budget I am about to announce is, therefore,
aligned with the 24 months recovery phase.
 BUDGETARY PERFORMANCE IN THE FIRSTHALF OF 2015 :
In its latest African Economic Outlook, the IMF forecasts growth in sub-Saharan Africa of 3.8
percent in 2015, the slowest growth in six years. Low oil and commodity prices, together with a
slowdown in China are the main reasons for the slow growth. In 2016, the report forecasts growth of
4.3 percent for Sub-Saharan Africa.
Global inflation is projected to decline in 2015 in advanced economies, reflecting the impact of lower oil
prices but to rise in 2016 and beyond. In emerging and developing economies, excluding Venezuela and
Ukraine, inflation will decline from 4.5 percent in 2014 to 4.2 percent in 2015 and is projected to decline
further in 2016.
The Ebola epidemic and global commodity price downturn, especially for iron ore, represents
exceptional external shocks beyond the control of Government. Total primary expenditure will amount
to Le3.6 trillion in 2015 compared to the original budget of Le 3.3 trillion. As a consequence, an
unanticipated financing gap emerged, estimated at Le 601 billion. The primary fiscal deficit is projected
to widen to 5.5 percent of GDP, compared to the initial ceiling of 3.5 percent. The financing gap will be
filled by the IMF augmented resources of US$ 22million and budget support by the World Bank of US$
30 million, the AfDB US$ 25million and the European Union € 25million.
 POLICY REFORMS: PROGRESS IN IMPLEMENTATION AND PLANS FOR 2016 :
The PFM Bill (Public Financial Management) is a modern and progressive piece of legislation that
generally reflects good practice among developing countries that have successfully improved public
financial and fiscal management. Its architecture requires significant levels of openness and
transparency and institutionalizes accountability between the Executive and Legislative arms of
Government.
To secure a sound and stable financial sector and reduce the high incidence of non-performing
loans, the Bank of Sierra Leone, in collaboration with the Ministry of Finance and Economic
Development and the National Commission for Privatization (NCP), put in place a resolution
mechanism for the adversely affected banks as a temporary measure. In this regard, the Bank
continues to strengthen its supervisory role by moving into risk based supervision, strengthening the
capacity of staff to undertake stress tests of the banking sector.
Government is also making progress in public sector reforms, especially under the World
Bank-funded Pay and Performance Project. These include filling about 805 priority vacancies in the Civil

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Service and the mainstreaming of Local Technical Assistants (LTAs) who are serving in key positions in
the Civil Service. Performance Management Contracts for civil servants from Grade 11 and above have
also been designed and administered by the Cabinet Secretariat.
 MEDIUM-TERM ECONOMIC OUTLOOK, 2016-2018
With the possibility that the external environment might turn even less favorable, risks to the
short-term economic outlook remains on the downside. With the continuing uncertainty in the iron ore
sector, Gross Domestic Product (GDP) is projected to remain largely unchanged in 2016. However, with
gradual recovery in the other sectors, non-iron ore GDP is projected to grow by 1.3 percent in 2016.
On the assumption that the Ebola Virus Disease is eradicated and iron ore mining resumes, the
economy is projected to recover strongly with a real GDP growth of 19.6 percent in 2017 and 17.5
percent in 2018. Similarly, the non-iron ore economy will continue to grow by an average of 4.5
percent in 2017 and 2018.
Given this expected recovery, domestic revenue is projected to improve to 10.7 percent of GDP
in 2017 and further to 11.1 percent of GDP in 2018. Total expenditure and net lending is projected to
decline to 19.0 percent of GDP in 2016 and to average 17.7 percent of GDP in 2017 and 2018 as fiscal
consolidation takes effect.
Inflation is projected to decline to a single digit of 9.5 percent in 2016 and 2017 and further
down to 8.5 percent in 2018.
I. Fiscal Policy
The key objective of fiscal policy in 2016 is to ensure fiscal sustainability through enhanced
domestic revenue mobilization and expenditure rationalization to maintain macroeconomic
stability and lay the foundation for sustainable economic growth and poverty reduction. In 2016,
revenue performance may be undermined if the crisis in the iron ore sector continues. To address
this, enhanced revenue administration measures will be implemented to ensure the effective
functioning of Government.
II. Monetary Policy
The primary objective of monetary policy is to achieve and maintain a low and stable
inflation environment conducive to high and sustainable economic growth. To this end, the Bank
of Sierra Leone remains committed, through proactive monetary policy management, to deliver
inflation at the targeted level of 9.5 percent at the end of 2016.

20
III. Exchange Rate Policy & Public Debt Policy
The exchange rate will continue to be market-determined. In this regard, interventions in
the foreign exchange market will be limited to smoothening short-term volatility in the exchange
rate.
Government will continue to implement prudent debt management policies to support
the implementation of the National Ebola Recovery Strategy in the context of the Agenda for
Prosperity. In the past, Government prioritized the mix of grant and highly concessional loans to
fund socioeconomic development programs. However, the changing global financial architecture
characterized by the sustained decline in global interest rates, means that these types of resources
are now hard to come by.
Additionally, in compliance with the IMF external debt limit policy, Government borrowing
space to finance mega project is limited. In this context, Government will embark on innovative
sources of financing including mobilization of non-traditional resources to finance development
programs. Furthermore, Government will also support the development of the domestic capital
market to raise additional sources to complement external resource inflows.
The overall public debt management strategy aim to minimize costs and risks on the debt
portfolio. The 2015 Debt Sustainability Analysis (DSA) shows that our external debt remains
sustainable in the medium- to- long term with a moderate risk of debt distress.
IV. Revenue Proposals
Ministries, Departments and Agencies (MDAs) are now required to make provision for
import duty in their budget for all contracts that are subject to taxes. As required by law, all duty
and tax waivers and exemptions, including waivers for petroleum products, will require prior
approval of Parliament.
13,52
17,82
0
2
4
6
8
10
12
14
16
18
20
%
Year-on-year % Change Consumer Price Indice Jan 11-Dec 15
Year-on-year % Change Linéaire (Year-on-year % Change)
7,85

21
Duty concessions to NGOs, tourism sector and road construction companies will be strictly
reviewed.
The top PAYE marginal tax rate will increase by 5% from 30 percent to 35 percent to make the tax
system more progressive. This will affect only those earning monthly incomes of above Le 2.0
million;
Government will apply the existing commercial fuel price regime to the retail pump price to
ensure a full pass-through from international prices, exchange rate movements and other inherent
costs in the formula. This is to minimize loss of Government revenues while removing distortions in
the domestic petroleum market. As of October 2015, total revenue loss from the retail pricing
formula amounts to about Le113.1 billion. To protect the vulnerable from any likely increases in
the prices of petroleum products from this policy change, Government will utilize additional
revenues from petroleum products to invest not only in infrastructure, but also in social projects
such as the National Youth Service, social housing and procure more buses for public
transportation, including for school children.
(i) The 2016 Finance Bill will also include other tax policy measures as follows:
raise withholding tax on management and technical fees from 10 percent to 15
percent;
(ii) introduce a national health insurance levy of 0.5 percent on the value of all
contracts in support of the proposed National Health Insurance Scheme.
(iii)The non-taxable threshold for personal allowances is increased from Le220,000 to
Le 400,000. In addition to the tax policy measures proposed above, the NRA will
continue to strengthen the implementation of measures to curb fraud and tax
evasion in 2016, including the following key actions: (i) build capacity for specialized
revenue audits, especially in the mining, financial and telecommunication sectors;
(ii) implement the Small Tax Payer Preparer Scheme to add flexibility in compliance
management of the hard –to-tax sector; (iii) develop and implement a revenue
accounting and reconciliation system for effective reconciliation with transit
accounts in the commercial banks and the Central Bank; and (iv) expand on current
automation drive of tax administration, including the introduction of an integrated
tax administration system and migration from ASYCUDA++ to advanced
customized management systems for customs operations.
V. Proposed Expenditure Priorities and Allocations for 2016
“The allocations of expenditures for the 2016 Financial Year are in accordance with the
priorities identified in the National Ebola Recovery Strategy anchored on the Agenda for
Prosperity which is largely aligned with the Sustainable Development Goals. Given our recent
experience in the mining sector, diversification of our economy will now be given utmost priority
to strengthen resilience of our economy” . DR. KAIFALA MARAH the Minister of Finance and
Economic Development.

22
Agriculture:
To revive the sector, Government will support the attainment of the following objectives: (i)
increasing agricultural productivity and production through, procurement and distribution of large
quality of subsidized fertilizers, rehabilitation of 1,000 hectares of Inland Valley Swamps country-
wide; supply of high yielding varieties of planting materials; (ii) support the transformation of
Agricultural Business Centers (ABCs) to promote value-addition and reduction in post-harvest losses
and formalization of the agriculture and private sectors; (iii) agri-business financing along the
agricultural value-chain through the Financial Services Associations and Community Banks; and
(iv) create markets for farmers through institutional feeding for our armed forces.
Fisheries:
As part of Government’s economic diversification strategy, attention will be paid to attaining
a blue economy. In this regard, for a start, Government is allocating Le3.0 billion to the Ministry of
Fisheries and Marine Resources from the recurrent budget and Le4.3 billion from the domestic
capital budget to support artisanal and inland fisheries as well as the European fish certification
project (PRECON). Government is also providing Le165.9 million for devolved functions in the
fisheries sub-sector to Local Councils.(SHP.SL is now involved in the project).
Tourism:
Again, in furtherance of economic diversification, Government will support recovery of the
Tourism Sector. The Ministry of Tourism and Cultural Affairs, in collaboration with the National
Tourist Board and the Monument and Relics Commission, will embark on local and international
rebranding activities; develop four eco-tourism sites; clean Lumley and other Peninsula beaches;
implement the second phase of the Lumley Beach Development Project; and establish regional
offices in Makeni, Kabala, Kenema and Bo. In support of these activities, Government is allocating
Le8.8 billion from the recurrent budget and Le4.2 billion from the domestic capital budget to the
Ministry and its Agencies.
Mines and Mineral Resources:
To support the formulation and implementation of mineral policies, Government is
allocating Le6.7 billion from the recurrent budget to the Ministry of Mines and Mineral Resources.
Of this, Le4.6 billion is allocated to the National Minerals Agency (NMA) to support the
administration and enforcement of the Mines and Minerals Act 2009 and other Acts and related
regulations in mining, as well as, trade in minerals.
In addition, Le1.5 billion is provided from the domestic capital budget for the reconstruction
of NMA regional offices and Le500 million to support the Extractive Industry Transparency Initiative
(EITI). The German International Development Cooperation (GIZ), the United Kingdom Department
for International Development (DfID), the African Development Bank, and the World Bank will
provide about Le4.0 billion to support various projects in the mining sector.
Health:
The key objectives in the health sector in the Ebola Recovery period are to: (i) build a
sustainable national health system that delivers safe, efficient and quality health care services
that are accessible, equitable and affordable for all Sierra Leoneans; and (ii) build a resilient

23
national health system that can respond robustly to a possible recurrence of Ebola or an outbreak
of any other deadly disease.
To support the attainment of these objectives, Le 91.8 billion is allocated from the recurrent
budget to the Ministry of Health and Sanitation. Of this, Le22.9 billion is to support basic health
services; Le24.8 billion for tertiary health services; Le23.0 billion for the procurement of drugs for
the Free Health Care program; and Le10.9 billion for cost recovery drugs and other medical
supplies. The Pharmacy Board is allocated Le4.0 billion. The Health Service Commission and the
Dental and Medical Board are allocated Le919 million and Le327 million, respectively.
In addition, Le68.7 billion is allocated from the domestic capital budget to the health sector.
Of this, Le46 billion is to support Public Health Sierra Leone;Le6.5 billion for the refurbishment of
Government hospitals; Le3.0 billion for piloting the National Public Health Insurance Scheme; and
Le12.2 billion as Government contribution to donor-funded projects in the health sector.
The World Bank, IDB, Global Fund, Kuwaiti Fund and the Arab Bank for Economic Development in
Africa (BADEA) are expected to provide Le153.4 billion to support various projects in the health
sector.
Education:
The focus of the education sector in the Ebola recovery period is to restore basic education
services across the country. To this end, Government is allocating Le210 billion from the recurrent
budget to the Ministry of Education, Science and Technology. Of this, Le56 billion is allocated
towards improving access to quality education including Le32.6 billion for secondary education and
as mentioned earlier, Le147 billion for tertiary educational institutions, including an amount of
Le113.7 billion for tuition fees subsidies to university students. Technical and vocational institutions
are allocated Le28.3 billion.
BADEA, Opec Fund for International Development (OFID) and Saudi Fund will provide
Le12.1 billion for the rehabilitation of Fourah Bay College. The tender for the works contract will
be published as soon as approval is obtained from the funding Institutions. Government is also
providing Le1.5 billion from the domestic capital budget as contribution to this project. An amount
of Le1.6 billion is provided for the rehabilitation of the Port Loko Teacher’s College and Le1.8 billion
for preparations towards the establishment of the University of Science and Technology in
Magburaka.
Energy:
In promoting a diversified economy and prosperity for inclusive development, Government
will seek to improve and expand access to reliable and affordable energy throughout the country. In
this regard, from 2016, the Ministry of Energy will implement projects to restore and expand
electricity supply in all the district headquarters and other selected towns, as well as rehabilitate
the national transmission network. The agreements with the successful bidders for the
implementation of these projects are being finalized for Cabinet consideration and endorsement by
this House.
The European Union, African Development Bank, Islamic Development Bank, and the
World Bank will provide Le110.1 billion towards various projects in the energy sector. In addition,
Abu Dhabi Fund will provide Le20.4 billion for the Solar Park Freetown Project. The US Millennium
Challenge Cooperation will provide Le15.2 billion to support reforms in the electricity sector.

24
Information, Communications and Technology (ICT):
Government, with support from the Islamic Development Bank, the Exim Banks of China
and India, is finalizing the construction of an in-Country Terrestrial Back Haul, Distribution
Networks, E-Government Infrastructure and Last Mile Solutions to support open access and
affordability of telecommunication facilities and services throughout the Country.
Through the support of the World Bank, landed the Submarine Fiber Optic Cable, that linked
Sierra Leone to the global high-speed Telecommunication Networks.
Through the combined efforts of Government and our partners, most of the major towns
and cities of our country now have Fiber Optic Cable terminating or passing through them. As an
immediate benefit of the E-Government platform, some MDAs have been connected to high Speed
Broad Band Internet facility through the Wide Area Network of the Ministry of Information and
Communications as a pilot.
Private Sector Development:
As part of our diversification efforts, we must strengthen our domestic production base,
particularly in the agribusiness value chain. In this regard, we will pursue the establishment of a
pool of financial and technical resources to be targeted specifically at agro-processors,
manufacturers and the transportation and logistics segments that enable the real economy.
To this end, Le11.4 billion is allocated from the recurrent budget to the Ministry of Trade
and Industry including Le4 billion to the Sierra Leone Investment and Export Promotion Agency
(SLIEPA) : http://www.investsierraleone.biz/download/MAFFS%20SLIPF%20Presentation.pdf
For instance a very important project has been launched by SLIEPA in Sept 2015 :
The Sierra Leone Investment and Export Promotion Agency (SLIEPA) has launched a project
to increase the country's export competitiveness through improved product packaging for small
and medium scale enterprises.
The program is being undertaken by the Ministry of Trade and Industry, in collaboration with
the Commonwealth Secretariat. The project would examine packaging in the country, looking at
constraints and making recommendations to the government.
Mr. Raymond Gbekie said the project has several phases with the first being to diagnose
packaging constraint in the country, identify gaps in developing the project as well as national
deficiencies in the trade swimming pool covers, adding that after that phase consultants will proffer
recommendation for implementation by the government.
He said the project was significant as Pillar Four of the 'Agenda for Prosperity' deals with the
competitiveness of local products in the international market.

25
While launching the project, acting Minister of Trade and Industry, Hon. Mabinty Daramy,
said government was very keen about the project as it would foster growth in the country's market
and put out local products to compete with others in the sub-region.
A comprehensive presentation on the project was done by Treglor consultants, led by
Ebenezer Mante, while the Adviser of Trade Competitiveness at the Commonwealth Secretariat, Kirk
Haywood, spoke on the benefits of the project to the trade sector and the Gross Domestic
Product.(SHP.SL is now part of the project with Dr James Braima).
To conclude this Post Ebola Chapter, we’ll quote again the Minister of Finance and Economic
Development:
“As we transition from MDGs to SDGs, the onus to deliver the 2016 Budget is on each and
every Sierra Leonean. We lost years of implementation of the MDGs due to the war and follow up
effects. We are now in a position to start implementing the SDGS with the rest of the world and
by 2030 we should be there on a very sound footing. But there is a caveat to be mentioned.
Studies show that as the world is aiming to end poverty by 2030, about two-third of the
world's poor would live in fragile and conflict prone environments. This is a risk we should and
must avoid.
Recent World events have also taught us the lesson that over dependence on one sector
will undermine our resilience. Therefore, as we continue to rely on our minerals, Sierra Leoneans
should embrace the culture of diversifying the economy.
We should devote attention to agriculture, our abundant fisheries resources, our beautiful
beaches and eco-tourism sites, for food security and employment for our youths. At the same
time, we should continue to improve access to energy and water supply, build roads, to
strengthen our resilience. We will do this responsibly to protect our environment for the benefit of
our children.”
III Products and Services
i. Cargo handling operation :
The fundamental principles of the cargo operation are as follows:
(source : World Bank and ICAO)

26
Cargo handling operations at airports involve the preparation of cargo shipments, the
loading and unloading of the aircraft, and the transfer of cargo between the storage facilities and
land transport. For outbound cargo, the preparation includes consolidation of cargo, building up of
the air cargo pallets and containers, inspection and documentation. For inbound cargo, the
preparation includes customs and other regulatory procedures, as well as deconsolidation. For
transshipment cargo, the operation is generally limited to unloading, reconsolidating, and reloading
the cargo but can be as simple as a direct transfer between aircraft (sometimes known as tail-to-tail
transfer).
Although air cargo ideally remains in the airport for a relatively short time, it is necessary to
provide storage facilities. Bonded facilities are required for imports and international transshipment
cargo. For perishable cargoes, it is necessary to provide cold rooms. For outbound cargo, it is
necessary to provide X-ray scanners to inspect the cargo. Since most air cargo is low density, most
of the cargo is stored on racks, preferably in large open warehouses with high ceilings (more than
eight meters). The storage areas must be equipped with loading docks on the landside to allow for
rapid movement of goods to and from trucks. Most airports also provide offices near the
warehouses for the airlines and forwarders to receive/deliver cargo and prepare shipping
documents, and for customs to clear import and export cargo.
On-airport cargo terminals are usually multi-tenant. These may be common-user spaces
managed by an authorized cargo handler, but, as traffic levels increase, carriers and integrators
often want to have their own space. Initially this may be space rented on a long-term basis but
eventually they need their own facilities (DHL e.g.). Similarly, forwarders/customs agents may
occupy a designated storage area or merely place their customers’ consignments in a common
area. In order to accommodate different carriers and consolidators, various airports have
established cargo villages. These are sites with multiple cargo terminals. They usually evolve from
the existing warehouse facilities, but in some cases are constructed on a new site. The village is
designed to allow better coordination of operations and improved traffic flow. It also allows for
provision of a common office building to simplify the interaction between the carriers, forwarders
and shippers. An alternative is to construct a larger, multi-story warehouse and lease space to the
various parties.
The area required for storage depends on the typical dwell time and stacking density. The
large warehouses achieve higher throughput by better planning of storage and greater use of the
available space. Although air cargo is low density, the dwell time is very short. Much of the cargo is
cleared in a few hours. That which is not, rarely remains more than two days so that 75–100 turns
per year is not unreasonable.
Customs has an important role in the use of an airport for import cargo and more
particularly for transshipment cargo. Because of the high value and time sensitivity of air cargo, it is
important to minimize the time required for clearance of import cargo and to simplify the
procedure involved in cargo transshipped through the airport. As it was mentioned in the 2016 SL
budget NRA will develop an integrated tax administration system and migration from
ASYCUDA++ to advanced customized management systems for customs operations. Many
countries have developed a dual track for clearing goods. Expedited services are provided for
express package services allowing them to meet tight delivery schedules, while large shipments are
cleared more slowly. Most major airports in developing countries can clear cargo in a few hours to
one day. While this is quite rapid relative to cargo shipped on other modes, anything over six hours
must be considered inefficient and a reasonable target would be two hours. This is possible because
of the level of computerization of airfreight documentation, which allows submission of the IGM
(Inward General Manifest) at the time of departure from the previous airport. Slow clearance times

27
are usually associated with the failure of customs and shippers to adopt modern information and
communications technology. These systems are also important for tracking shipments and for
ensuring efficient use of warehousing space.
The attractiveness of an airport for air cargo operations include the regulatory environments
for international flights, the charges levied by the airport operators and national civil aviation
authorities, the costs for cargo handling services, ability to contract third-party services, and airfield
resources. While the latter is important, air freight carriers can adapt marginal or even inadequate
facilities by changing equipment that is using less than optimal gauge aircraft where runways are
too short and employing refrigerated containers at airports lacking refrigerated warehouses.
The airport charges are important, but most airports set their aeronautical fees through
comparison with other airports in the area. The costs for cargo handling remain a critical factor and
depend on the level of competition permitted for on-airport services.
ii. AIR CARGO FACILITY ANALYSIS
Like passenger terminals, parking garages, and runways, the development of air cargo
facilities generally follows a process. Due to the somewhat unique nature of the air cargo market,
this process can be more complicated than that for other airport facilities, however, the
development process can be generally defined for an airport operator by answering six questions.

28
a) What is the cargo market at Freetown International Airport?
b) How do we develop the market?
c) How do we sell the Market?
d) What are the facility requirements?
e) Do we have the right facilities?
f) How do we develop the right facilities?
a) What is the cargo market at Freetown International Airport?
The first phase of any cargo development program should include a market assessment to
establish geographic market size and growth. If the results are favorable subsequent phases would
include selection of target markets and market surveys. The term cargo market does not just refer
to the potential for the flow of goods (the operating market) but also pertains to the potential for
cargo facilities at an airport (the leasing market). It is very important for an airport operator
answering this first question to develop a strategy for determining air cargo facility capacity.
Regarding Import (except the extra Cargo we got during the EVD (more than 4000 T extra Cargo)
our usual market was based on general goods (second hands clothes bundles for instance coming
from Nigeria or Kenya ) ,personal effects ,IT appliances for telecom and mainly , equipment for
mining industry).Even if the mining Industry (iron ore) is suffering at the moment , the other
minerals production as diamonds, rutile or bauxite are still alive … We should maintain this basic
traffic in the future . We don’t have any perishable goods arriving via Air Freight as we can find in
the other western African countries to supply the local supermarkets. The facilities offered with our
Cold rooms should develop this traffic (fruits, vegetables or dairy products for instance). We should
have a look also on the border countries, especially GUINEA, because of the poor quality of Cargo
facilities in Conakry and the easy connection by road between the two countries.
Concerning export, the traffic is at the moment at a zero level! This will be one of the key of
our success. The projects lead by the government in fisheries and Agriculture will help us (not in a
short term) to increase this activity.
0
500
1 000
1 500
2 000
2 500
Import in tons

29
b) How do we develop the market?
The best way to develop the market is to survey the people who are involved in the
movement of goods into and out of the community. This includes in addition to the carriers, air
cargo associations, freight forwarder and customs broker associations, trucking, major
manufacturers, Chambers of Commerce, and Economic Development organizations, which are all
very good sources of information about what is entering and exiting the local marketplace. Due to
competitive concerns, the information will be somewhat general but it will still provide the
necessary input to determine the existing market and areas of potential growth. This what we
explained in the first part of our Business Plan , looking at the Post Ebola economic situation and
the projects implemented in the new Sierra Leone state budget for 2016 and the following years .
Like the passenger airline industry, the air cargo industry is very sensitive to the national and
world economies. An expanding economy leads to increased production and therefore an increase
in demand for air cargo. World air cargo demand tends to drop off very quickly as the world
economy begins to stall, but then tends to be an early indicator of economic recovery, since
demand increases early in the economic upturn. This trend can be seen in figure 1.1.
0
5
10
15
20
25
30
35
40
45
50
Export in tons
0
1 000
2 000
3 000
4 000
5 000
6 000
7 000
8 000
9 000
10 000
2010 2011 2012 2013 2014 2015
1 131
2 474
4 043 4 644
9 621
4 668
TOTAL in tons

30
c) How do we sell the Market?
Selling the market requires convincing the airlines and other cargo operators that there is a
profitable opportunity for them to commence service to your market. Preparation of presentations
showing volumes of existing cargo along with growth potential, the benefits of using our airport
and the support of the forwarder community is important.
We also have to raise awareness among governmental entities, as we did with SLIEPA in
January regarding the project they are developing on “packaging” : “The Sierra Leone Investment
and Export Promotion Agency (SLIEPA) has launched a project to increase the country's export
competitiveness through improved product packaging for small and medium scale enterprises.”
(See page 24).
Following the contact we had with SLIEPA, they expressed their interest in the project (see
the letter below) and visited the Cargo terminal on the 25th
of February: they were very impressed
by the project as confirmed by the SHP.SL GM’s report below:
“I have just walked around the cargo terminal with the SLIEPA delegation. They were four
people and they were very impressed. They congratulated us for a great job done that will be a very
big bonus for the country and its exporters. They told me they had plenty of investors who come by
their office on a regular basis and they will be promoting this facility, the best they can. Now that
they’ve seen it and know what it can do, they will talk to the proper people who have been
complaining about not being able to export from SL.
They asked about the commissioning, which I said would be done according to H.E.‘s
schedule whose office will be informed as soon as we are 100% ready !They requested, if possible,
to be invited for the commissioning as well and promised they would be in touch with more news
and potential exporters ASAP.
I explained our role, putting the facility at disposal of exporters and airlines and that the
obstacle that still needs to be tackled, according to our first observations is finding a company able
to package the goods according to the International standards … Especially when it concerns fresh
food such as fish, lobsters, shrimps and even acceptable packaging for vegetables and fruits …
They promised to have a look at that as well…
Overall they left with a big impression of SHP/GEH.
Peter METZ”

32
Following the visit S. Shiaka Kawa, Director of Export Development of SLIEPA sent this
e mail to the GM Peter Metz :
“From: Shiaka Kawa [mailto:skawa@sliepa.org]
Sent: 01 March 2016 22:24
To: pmetz@shp.sl
Cc: 'Raymond Kai Gbekie'; emassally@sliepa.org; vbangura@sliepa.org;
kobas123@yahoo.com
Subject: Cargo Facility
Dear Peter
Thank you for taking us on a conducted tour of the new cargo facility at the Lungi Airport.
We were quite impressed with what we saw as it is world class and meets international
industry standards.
We acknowledge that work is in the finishing stages and we would look forward to working
with you at a later date on developing a roll out strategy for the facility.
Best wishes
S. Shiaka Kawa
Director of Export Development
Sierra Leone Investment and Export Promotion Agency
(SLIEPA)
O A U Drive, Tower Hill,
Freetown, Sierra Leone
Tel: +232-76-603665
Website: www.sliepa.org”
Our pricing policy will be also crucial at this stage. We already revised our handling fees
for the ad-hoc flights and have to be very careful with our Cargo handling fees for the export
goods, which usually have a low added value as vegetables or sea products. This effort should be
shared by other stake holders as SLAA, Westminster or NRA.
d) What are the facility requirements?
Once a handler has a general understanding of the cargo market and how to develop it, the next
step is to identify the location, type and size of facilities needed to satisfy the market demand.
This should include existing and projected future demand. When we started the project in 2011,
we had all those requirements in mind! That’s why the conception of this Cargo Terminal
included from the beginning all the facilities (X-Ray machines, electronic scales, stackers or cold
rooms) to meet needs of the present and future market, and also the land available to extend
the capacity of our terminal.

33
e) Do we have the right facilities?
Having the right types of facilities means:
• Having an adequate supply of cargo buildings, staging, storage areas, and apron in the
optimal location.
• Understanding the mix of carriers, and the necessary support services to the entity to
which the facility could be leased, and the warehousing, office, and GSE space as well as the
landside and aeronautical infrastructure they require for cost-effective operations.
• Determining the appropriate throughput for the potential tenants and users of the facility.
• This phase of the development process usually includes a site selection study for future air
cargo facilities. Once a site has been selected, the best layout of facilities on the site is determined.
Cost estimates are then developed for the final cargo facility layout.
To answer to these questions, let us have a look on all the details of this new Cargo Terminal:

34
To answer to these questions, let us have a look on all the details of this new Cargo Terminal:
1. Mass Plan and the detailed plan:

35
Our Cargo Terminal is a building of 2 500 sqm (50 m X 50 m) .The vertical storage can reach
6.9 meters and the height at the top is around 10 meters (our terminal cannot be taller than the
control tower).
2. Storage
The two areas (import & export) will be equipped with pallet racks from MECALUX;
The storage facilities (import & export) will be around 900 EU pallets. The Euro pallet has the following
specification:
Standard size (L × W) = 800 mm × 1200 mm
Maximum pay load = 1000 kg*
Empty weight = 25 kg
* If the pallet is of good quality

36
If we consider an average weight of 150 Kg per pallet, our capacity of storage is around 225
Tons. Last year we handled from January to December 2015, 4 688 Tons (import & export) i.e. 13
Tons per day. As most of the shipments are usually staying less than 5 days stored, we can see that
our capacity of storage is more than required.
Different warehouse technologies are introduced as the volume increases (Table 3-3). The
larger warehouses usually have more sophisticated equipment and layouts with the result that the
throughput per square meter is also higher. These tend to be operated by ground handlers, who
have sufficient volumes to justify the higher capital expenditure, as GEH and SHP.SL did .We
introduce automation because of the need to manage international supply chain,
SOURCE: The World Bank group.
Initially, the annual capacity of the Cargo Terminal planned in the project was 7 000 Tons. If
we consider the turnover of consignments in the Terminal (5 days max) , it means that the capacity
of the building, because of the racks, could reach around 17 000 Tons per year.(Import+Export).

37
3. Lifting Equipment.
To handle freight inside the terminal, SHP.SL is equipped with 2 electrical stackers:
YALE MS16
ELECTRIC WALKIE STACKER
° Serial No : C852X01683E , ° Engine : ELECTRIC , Mast : 4,32 m
These stackers with a mast of 4, 32 m will fill the pallet racks (max height 4 meters).
4. Weighing.
We chose to install in the import area two Dual Roller Desk Scale from METTLER TOLEDO:

38
Each scale has a weighing capacity of 5 000 Kg and accept 10 ft airfreight pallets. Roller-deck scale
accurately weighs cargo pallets before they are loaded onto aircraft. The scale is an elevated rack designed
so that containers can be easily loaded onto the scale from a cargo cart. Weighing deck has built-in rollers
that make it easy to position pallets. Retractable stops help hold pallets in place. Scale is supplied as a dual-
platform system for weighing two 10ft or one 20ft at a time. Those two scales are equipped with a
weighing terminal:
• Multi-scale operation with up to 4 weighing platforms at IND690 and up to 3 weighing platforms
at IND690xx and IND690-24V, including weighing platforms with an analog signal output.
• Up to 9 data interfaces
–for printing
–for exchanging data with a computer
–for connecting a barcode reader
–for controlling e.g. valves or flaps
–for connecting reference scales
–for connecting an external keyboard

39
This electronic scale is very important on the Safety side as it provides the true
weight of pallets loaded on the aircraft, and a valid load sheet absolutely compulsory for the
load and flight plan.
5. Cold rooms
In order to develop the traffic of perishable goods (Import & Export) but also vaccines for
instance, we equipped our terminal with 3 cold rooms with a global capacity of 950 cubic
meters.
One is available for both IMPORT and EXPORT. It can be changed according to Volume
requirements.
Europa modular cold rooms can be partitioned or coupled and are available in varying
thicknesses and heights, with or without floor, to form layouts from the most simple to the
most complex. They can be upgraded and are ideal for commercial or industrial applications.

40
6. Offices for the stake holders (Airlines, Cargo agent) .
A mezzanine has been built in order to accommodate 12 offices for the Airlines and the
Cargo Agents .These offices are furbished (AC and basic furniture) and WI FI available. They
will be rented to the agents and Airlines.
7. Security and Safety.
Security requirements will continue to play a major role in how cargo facilities are
built and operated. Cargo security requirements incorporate a level of increased cargo
screening. This can occur at the point of origin with the shipper or forwarder, within
individual cargo facilities, or at a Certified Central Cargo Screening Facility. Employees
with access to the Air Operations Area (AOA) are subject to a great level of security
background checks and screening. Access to the AOA will be more limited, and the
number of access points to the AOA reduced.
Westminster Intl Ltd will be in charge of Security and Safety for the Cargo Terminal.
They also are in charge of the scanning of goods for export, with 2 X-Ray machines. One
is already in place, the other one will be implemented later.

41
They also installed an Access Control System, CCTV System and Fire Detection
System as shown below:

42
After looking over all the facilities offered by our new Cargo Terminal, we can confirm that
SHP.SL got the right facilities to perform operations in the future for Import as well as new Export
markets . We created one of the most attractive Cargo Unit in the sub-region. The key to avoiding
overcapacity is to build facilities with flexibility in mind. That’s why the building concept includes a
2 500 sqm extension, in case of a tremendous traffic growth. (With the current facility we could
handle, as we saw upper, a yearly tonnage of 17 000 Tons).

43
The two “weakness” of the project to be taken in consideration are:
 The location of the Airport, far from Freetown.
As reported by the media “President Ernest Bai Koroma’s government informed the
International Monetary Fund it had abandoned his flagship project, the Mamamah international
airport”. This cancellation of the project recommended by IMF, may allow a better Ferry’s services
between LUNGI and Freetown, in order to facilitate the access of passengers and goods from the
airport to the town. A major improvement has also been down with the opening of the PORT
LOKO road which allows trucks to reach Freetown in less than two hours, and is also the highway
to Conakry.
Another solution would be (as it was previously planned around the new Mamamah) to
create and develop an Industrial estate around the Airport (an Export Processing Zone could be
created to attract new investors as done in NIGERIA for instance).
http://nepza.gov.ng/freezones.asp ) as Space, electricity, water supply and even Fiber optic are
available on the site and the surroundings.
 Aircraft parking apron.
Air cargo ramps vary considerably more in relation to cargo volumes than buildings, and, in
part, are a function of available land and the airport layout. As we can see page 30 on the mass
plan, a land is available to extend the Parking Apron.
At the moment, freighters are usually parked in front of the Presidential Lounge with two
major problems: in case of Presidential aircraft movement and the lack of pits for refueling on these
two positions. The freighters have to move from their position to refuel before departure, which is
not cost-effective.
There is a need for greater specialization in airport cargo facilities. This includes
specialization that meets the individual operating needs of the carriers, cargo tenants, airport and
the cargo industry will be required. Efficiencies to keep costs down while accelerating cargo
processing and improving customer service will be the key. Ideally, the Parking Apron should be in
front of the Cargo terminal.
To minimize aircraft taxi distances, the site should have direct airfield access to a primary
runway. The airport authority (SLAA) is part of the team to help the carrier and the Handler achieve
time definite delivery.

44
The requirement for airside apron (marshalling areas) will vary. Freight forwarders, mail
facilities, and airline tenants (belly freight) are generally compatible and typically do not require
airside apron space in a facility. However, the aircraft ramp requirement and intense use of ground
service equipment by integrated and all-cargo operators may create conflicts with the traditional
cargo handlers.
The guiding principle for locating cargo facilities is very simple: keep the cargo buildings
very close to the aircraft.
f) How do we develop the right facilities?
The Figure below is a summary of the six questions identified above, and also outlines the marketing
aspects of air cargo facility development.

45
The six questions we answered in the previous sections could be summarized with that
other figure:
The Air Cargo market, like the stock markets, is very difficult to forecast given the many
variables and factors involved in air freight trends. The air cargo industry is continually adapting to
threats and opportunities. The primary driver for air cargo growth is global economic activity
which is determined and measured by the World and the local GDP. Currently, the GDP growth is
relatively flat which is due to high unemployment in developed economies and weakened and
strained consumer purchasing. In the next 20 years, the world economic growth is forecasted to
average around 3.2%.
Air cargo is anticipated to grow at an annual rate of 5.2% and be a critical component of
supply chains both domestic and international, especially in emerging markets which will connect
established economies with developing regions. These are markets where population migration
and growth in the middle class have created a strong demand for food and perishable
commodities, which will substantially increase in volume and tonnage. The Boeing Forecast
indicates that over the next 20 years, air cargo traffic is expected to double globally which in turn
will create a demand to expand freighter fleets to approximately 3,200 airplanes. The largest
growth market segment will be larger aircraft with payload lift capabilities of 80+ tons as traffic
builds on long-haul international trade routes.

46
A number of factors will have an impact on air cargo growth and pose global challenges in
the air cargo industry and effect sustainability. Those challenges that are the most critical as air
cargo grows into the future are geographical modal shifts, fuel costs, environmental policies,
security, and technology advances both in equipment and information.
Clearly our development in Lungi should go through the development of the perishable
goods traffics.
On the import side, you will not find in FREETOWN any supermarket offering fresh
vegetables, fresh dairy products or fresh meat as you can find everywhere in most African
countries! For instance in CONAKRY you can find this kind of supermarket with international store
brands as INTERMARCHE, LEADER PRICE or BELLE FRANCE, with French products imported by Air:

47
This aspect has to be included in our Marketing plan. As Air France, 3 times a week, is
serving the Conakry Freetown route, they could feed the local market with lower freight charges
than food coming directly from Europe.
Let’s have a look on the retail sector in Africa through a study made by KPMG Africa in
September 2015 on the sector:
Key Drivers
Demographics
Demographic factors underpinning Africa’s retail sector
expansion include:
A large population – estimated at just over 1.1
billion in 2014. SSA accounts for 81% of Africa’s total
population, while Nigeria accounts for around a fifth of the
SSA total. Other countries with notable population sizes
include Ethiopia, Egypt, and the Democratic Republic of
the Congo (DRC).These four countries account for 38%
of Africa’s total population.
Population growth rates are still relatively high.
This trend is confined to SSA countries, as population
growth rates in North Africa have already declined
significantly on the back of lower fertility rates. In turn, this
trend is in line with differences between the stages of
economic development that the regions find themselves
in.
Urbanization rates are rising. The effect of
urbanization on economic growth – or vice versa – is
dependent on job creation, the economy’s structure, and
– crucially – the definition of urban areas. UN figures
indicate that in SSA, the urbanization rate increased from
11.2% in 1950 to 24.1% in 1980, and 36.4% in 2010.
(Note that this is a weighted average.) The UN forecasts
that SSA’s urbanization rate will reach 45.9% by 2030
and 56.7% by 2050. The urbanization rate of East Africa
is much lower than the rest of SSA. In 2010, East Africa’s
urbanization rate was almost 17 percentage points lower
than that of the Franc Zone, which has the second lowest
rate on the continent. East Africa’s low level of
urbanization can be ascribed to the substantial
importance of subsistence agriculture in most of these
countries.
Beneficial changes in the age structure. The
composition of the population is crucial, as a large
proportion of children and/or elderly in a population (i.e. a
high dependency ratio) implies that the working
population will have fewer resources to save and spend.
The dependency ratio is therefore very important for
forming a view on the outlook for consumer spending.
Taking the above factors into account, we have
developed a Demographic Potential Index (DPI) for 30
African countries, which is shown in the accompanying
graph. The index value can potentially range from zero
(worst outcome) to 10 (best outcome). Due to its large
population size, Nigeria performs the best by far. On the
other hand, countries that outperform significantly relative
to their population sizes include Gabon, Libya, Botswana,
Tunisia, and Mauritius. These countries have the potential
to benefit from demographic shifts despite having
relatively small population sizes, due to either having an
urbanized population, or due to the working age
population accounting for a sizable proportion of the total.
Meanwhile, countries that perform notably worse than
their population sizes would suggest, include Uganda,
Malawi, Kenya, Tanzania, Mozambique, and Ethiopia. For
comparison purposes, note that China’s index value is
calculated as 8.8.
The first graph in this section shows the
breakdown of households by their per capita spending
(based on the World Bank’s Global Consumption
Database). Only a few countries on the continent have a
notable proportion of households that spend more than
US$8.44 per day; in fact, this proportion is above 10% of
all households in only eight countries. And, of these
eight countries, only South Africa has a large population.
Furthermore, in 29 of the 36 countries in this sample,
more than half of all households have spending per
capita of less than US$2.97 per day. In most countries,
the focus for investors will therefore be the FMCG
segment, as most people are not able to afford durable
or luxury goods. That said, even though the proportion
of middle- to high-income groups is generally low, some
of the more populous countries will still have a
reasonably large middle class in absolute terms. In
particular, there are bound to be opportunities in some

48
of the well-off suburbs of the financial capitals of some countries, including Lagos and Nairobi
.
According to that study, Sierra Leone is between
Ethiopia and Uganda for the spending power, far in front
from Guinea and Liberia. Based on this ‘narrower
definition’ of the middle class, Africa has 36.2 million
people in the middle class, 48% of which reside in South
Africa. According to these estimates only five other SSA
countries have more than a million people in the middle
class. These are Ethiopia, Kenya, Ghana, Ivory Coast,
and Uganda. One of the most notable results is that
Nigeria’s middle class is relatively small, at only 803,200
people. It is possible that the data underestimates
Nigeria’s middle class due to the small sample size;
however, the result stands to reason considering World
Bank poverty statistics that show that around 70% of
Nigerians still live on less than US$1.25 per day.
Although having relatively small middle classes in
absolute terms (400,000 people), there is a relatively
large proportion of middle class people in Gabon (28.2%
of households) and Mauritius (32.5% of households).
Mauritius also benefits significantly from the steady
influx of tourists, who are generally well-off and boost
the demand for some products, such as souvenirs and
clothing. As such, developments like the Bagatelle Mall
south of Port Louis, Sunset Boulevard in Grand Bay and
Le Caudan Waterfront in Port Louis continue to attract a
constant flow of people. All countries in the graph up to
Chad have middle classes of more than 300,000 people,
thus providing at least some opportunity for retail
companies looking to sell more than just the basic
products.

49
Africa’s retail sector remains relatively under-developed at
present, with most shopping being done at traditional
shops. Much has been said about the prospect for
consumer spending in Africa, driven by demographics
and rapid economic growth. This has fuelled massive
interest from international retailers to establish a footprint
on the continent. Given that many Africans tend to be
brand-loyal, it is important to enter the market at a
relatively early stage, in order to have first-mover
advantage and to establish brand loyalty. Five
underlying trends are expected to boost Africa’s retail
sector over the long term, namely:
 Robust economic growth relative to the rest
of the world;
 Still-low penetration rates of most consumer
goods;
 Saturation levels and lack of further growth in
mature markets;
 The expansion of modern retail outlets, and
the general improvement in infrastructure; and
 A shift in the preferences of African
consumers from informal shopping outlets to modern
formal Western-style retail.
An increasing number of consumers are on the
cusp of the US$1,000 annual income level, which will
allow for the expansion of consumption beyond just the
basics. Retailers will be looking to take advantage of the
large market at the low end, while gradually starting to
offer these consumers higher-value products. In essence,
the key strategy for most retailers focused on Africa will
be to 1) capture the large low-end market, and 2) benefit
from higher margins as these consumers start trading up,
e.g. from unbranded to branded beer. By establishing
brand loyalty at an early stage, consumer goods
companies can benefit from the growth of the African
consumer. This is not to say that there is not potential for
the luxury goods sector as well, although it remains in its
infancy at present in most countries.
.
Let’s have a look on GHANA retail situation:
Ghana’s modern retail sector is restricted mainly to Accra,
with some recent activity in Kumasi. In addition, most
Ghanaians still do their weekly shopping at street markets
as the middle class, who typically frequent modern
shopping malls, is still small. Although there are currently
only a small number of international retailers on the
scene, the comparatively accommodative business
environment makes the West African country more
attractive as an investment destination. Ghana was
ranked 70th out of 189 countries in the 2015 World Bank
Doing Business survey. Only three countries in Africa are
ranked higher than Ghana: Mauritius (28th), South Africa
(43rd), and Rwanda (46th). It is also less of a problem to
source products in Ghana than it is in some other African
countries. Companies that have set up manufacturing
facilities in the country include Unilever, PZ Cussons, and
Denmark’s Fan Milk Group. Retailers can therefore buy a
variety of products locally rather than import them.
The West Hills Mall (27,000 m2) on the Accra-Cape
Coast Highway, the largest of its kind in Ghana, opened
its doors for business on 30 October 2014. The new
development boasts two anchor tenants, Shoprite and
Palace, as well as 63 line shops. The success of this mall,
which has a 100% occupancy rate, has also spurred the
developers of the first phase, Delico Investments, to draw
up plans for additions to the mall, which will add 12,154
m2 of retail space to the facility. The success of
developments such as the West Hills Mall, Accra Mall
(22,900 m2), A&C Square Mall (10,000 m2) and the
Oxford Street Mall (6,230 m2) have prompted further
development plans, with Broll Property Group projecting
in its 2014 annual report that more than 165,000 m2 of
formal retail space will come into operation by the end of
2016. The rapidly growing demand for shopping options
is outpacing the supply of viable modern shopping spaces
in the West African nation, where retail rents have pushed
to levels as high as US$60/m2, according to Broll
property. Other notable new developments include the
Achimota Mall (13,000 m2) and the Kumasi City Mall
(27,000 m2).
A number of South African retailers have expressed a
desire to expand their presence in Ghana, and to take up
space in new developments. These include Shoprite,
Game, Foschini, Mr Price, Spur, Truworths, Woolworths,
Edgars, Famous Brands and Pick and Pay. Well-known
international retailers have been more reluctant to enter
the market, although Zara, Mango, Hugo Boss, Tommy
Hilfiger, and TM Lewin have recently shown interest.
Investors, developers and retailers are also monitoring a
number of key risks such as the depreciating cedi, high
inflation, the recent slowdown in economic growth, the
government’s large fiscal deficit and the erratic electricity
supply. Some of these issues are however being
addressed: most notably, the recent start-up of the
Atuabo gas processing plant will boost Ghana’s
electricity-generating ability and the signing of an
economic reform programme with the IMF will help to
reduce the budget deficit over the medium term, which in
turn would also reduce inflation. This will however take a
few years to start having a positive impact on the
Ghanaian economy, with consumers likely to feel the
pinch of a more austere budget (lower wage increases in
particular) in the interim.
Outlook – Formal retail space in Ghana is in short
supply on the back of increased latent demand from
consumers, which has been boosted over the past
decade by strong levels of economic growth, albeit slower
in recent months. However, consumers are currently
under pressure due to high levels of inflation, a rapidly
depreciating currency, high commercial bank interest
rates, and higher utility and fuel prices. Private
consumption levels will therefore be negatively impacted
during the coming year, but we remain upbeat about the
long-term potential for the sector, which will be supported
by a growing middle class and a declining population
growth rate. E-commerce should also pick up in Ghana
as around five million (almost 20% of the population)
internet users are currently active. There is massive
potential in this market as stronger future growth
prospects should be accompanied by a higher number of
internet users with greater disposable incomes.

50
On the evidence of this study and according to the Sierra Leone ranking, we can reasonably think that the
development of the retail sector will take place in Sierra Leone in a medium term, boosting our Import
volume of manufactured or perishable goods. If we consider the evolution of the Net salary per day of the
SHP.SL staff between 2011 and 2015, we are on the good way!
Regarding export, we have to wait at least six months or one year for the ongoing projects with
fisheries and vegetables export certifications and packaging.(ref SLIEPA project and PRECON consultancy
project).
Another way to develop our activity in the future will be the opportunity to create an “Export
processing zone” around the Airport area as we spoke before page 38. As the Freetown urban area is
saturated and lands for industrial development are becoming scarce in town, a project creating a “free
zone” around the Airport would be a very good opportunity.
The main objective of EPZs is to attract investments that would otherwise not materialize and, as
such, promote non-traditional exports, generate employment, and enhance the host country’s foreign
exchange earnings. The long-term logic of EPZs is that foreign investments have the ability to create much -
needed transfers of skills and technology, fostering local spin offs, increasing knowledge of how to enter
the global market, and improving access to international distribution channels.
Firms established within the zones are most often given tax exemptions, called ‘tax holidays’,
which are a reduction of corporate income taxes for a period of time .EPZ firms are further commonly
allowed unlimited duty - free import of raw and intermediate inputs and capital goods for production, and
unrestricted repatriation of profits.
Infrastructure, such as transport, electricity, and water, is generally well developed relative to the
rest of the country, and subsidized by the government. Service provisioning may also be subsidized, and
bureaucracy simplified. Investors are typically given the benefit of dealing with only one office in setting up
operations (e.g. http://nepza.gov.ng/default.asp )..
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2011 2013 2015
7%
85% 93% 87%
8% 7% 13%
Net Salary per day SHP.SL staff
< 2,97 > 2,97 & < 8,44 > 8,44

51
The traditional EPZ model mainly limits activities to light manufacturing, and allows
for developing countries to take advantage of their low - cost and low - skilled labor by attracting
export - oriented enterprises to the zones. Traditionally the zones have also been kept separated
from the domestic economy by geography or jurisdiction. There has however been a gradual shift
from the traditional EPZ model to a range of different zones offering a greater variety of incentives
and economic activities, such as “agriculture, manufacturing, construction, communication, trade,
catering, housing, public utilities, and other services as finance and tourism”. The zones are often
now also less isolated from the domestic economy, and may also produce for the domestic market.
Zones are furthermore increasingly developed by the private sector. Some countries do however
give EPZ incentives to single firms that mainly produce exports. These firms are called ‘export
processing units’ (EPUs), or ‘single factory units’, and are in general not required to locate in a
specific area (e.g. Airport).An Hotel for crew changes and a catering unit could also be good
opportunities especially if Fly Salone wants to operate a hub in the Lungi Airport as announced.
IV. MARKETING PLAN
This chapter focuses on successful marketing and facility development strategies to
overcome the obstacles an airport may find in its path to take advantage of the potential for this
future growth in the air cargo industry. The purpose of combining a discussion of marketing and
facility development in one chapter is the belief that they cannot be successfully pursued
separately. They must be unified under one policy or focus to achieve the best results. Many well-
intentioned marketing plans end up gathering dust on shelves because they were either not
grounded in reality or were not supported by the entire organization.
It should be emphasized that the marketing and facility development strategies discussed
below represent a snapshot of a moving target. The dynamic changes underway in the air cargo
industry require constant attention to adjusting these strategies, discarding some, and developing
new ones to keep pace and take advantage of the future growth that will surely come to this
industry. It is important to remember that development is always subject to the cost of money.
How can an airport participate in future air cargo growth?
To successfully participate in the growth of air cargo, every airport needs a clear set of
objectives and a comprehensive air cargo marketing plan. The first step in the process is to identify
the strengths and weaknesses of the regional market, the air cargo facilities, and the service
infrastructure.
Although market potential is the driving force that attracts air carriers and a wide range of
supporting businesses to an airport, a combination of other factors including the availability of
roadway access, warehousing, aeronautical infrastructure, and ramp space also influences the
decision to make profitable an operation in a given area.
Thus, it is essential that the marketing effort be closely coordinated with a comprehensive
plan for the development of cargo facilities (if needed). The second step is to establish specific
objectives, identify your target audience and design a marketing strategy that will reach your
customers and achieve your goals.

52
.
a) IMPORTANCE OF AIR CARGO TO THE REGION.
The existence of a well-developed air cargo infrastructure benefits not only the airport, but a
region's economy as well. A solid infrastructure consists of a good roadway system, a strong
forwarder community, sufficient lift to meet the needs of the region's shippers, and other services
particular to the community.
The airport becomes more attractive as a location for a manufacturing plant if, for example,
air service exists to expedite products or components to the marketplace. However, as an airport
evaluates its potential for air cargo, it is important to remember that for cargo service to work,
there usually needs to be a balance between inbound and outbound tonnage.
Airports are magnets that attract major industry to an area.
In the fast paced air cargo environment, shippers and forwarders have a need for up-to-date
and accurate service information. Although a particular airport may in fact have a number of
advantages or strengths such as service availability ease of access and/or superior infrastructure and
facilities, the shipping community may be unaware of these factors. It is very important therefore,
that shippers understand the competitive advantages of our airport.
World air freight traffic is strongly related to GDP.
Africa forecasts for Air Cargo:
Overall, air trade between Africa and Europe will
grow 4.3% per year, while Africa-Asia air trade
will expand at an average annual growth rate of
6.6%. Air trade between Africa and North
America will grow 5.2% per year, albeit from a
smaller base than either Europe or Asia.
Base, low, and high models were developed to
forecast the Africa-Europe air cargo market. GDP
projections of 0.5% below and above the baseline
were assessed, and the results of these growth
rates are reflected in the low and High-growth-
rate scenarios.
In the Africa-to-Europe direction, growth is
expected to average 3.5% per year. The baseline
forecast for this air trade flow assumes recovery
of Europe’s economy, continued diversification of
African manufacturing, and moderate growth in
production of perishables.
The projected strong growth of Africa’s
economies will spur air trade in the Europe-to-
Africa direction to grow more rapidly than in the
Africa-to-Europe direction. The base forecast of
5.0% air traffic growth assumes rising African
consumer buying power for goods that arrive by
air and increased investment in industries that
depend on air cargo for time-critical shipments.
As the manufacturing base in Africa continues to
develop, the diversity of inbound air cargo should
increase, reducing vulnerability to swings in
commodity prices.
Asian imports to the continent will be the
principle driver for growth of African trade with
Asia. Follow-on investment by China in extractive
industries, continuing urbanization, and rising
demand for consumer goods will propel air trade
growth in the Asia-to-Africa direction to average
6.9% per year for the forecast period. Trade in
the Africa to-Asia direction will expand at a
slower rate of 4.8% per year as industrial ties with
Asia develop gradually.
Development of African air trade with North
America will also remain directional. North
America–to-Africa flows are expected to grow
5.2% per year through 2033, driven by continued
US and Canadian investment in African extractive
industries. Africa-to–North America air trade will
grow at the nearly identical rate of 5.1% per year,
as African light manufacturing develops export
markets in North America.

53
Source:
The Structure of the SL foreign trade in value
was as follows in 2013:
EUROPE 23%
US 5%
ASIA 31%
AFRICA 38%
OCEANIA 3%
IMPORT 2013
EUROPE 16%
US 3%
ASIA 57%
AFRICA 23%
OCEANIA 2%
TOTAL 2013

54
The value of exports to China grew by 105.9% from 2012 to 2013, while the share of the
value of export in total export to China increased from 33.3% in 2012 to 40.4% in 2013, making
China the leading country for Sierra Leone’s export in the last three years.(Iron Ore).During the
same period the value of exports to America fell by 24.4% between 2012 and 2013,and In 2013, the
export value to Europe fell by 50.9% compared to 2012. The trend indicates an improvement in
intra-Africa trade.
Imports from China, Lebanon, India and Pakistan increased by 53.3%, 8 4.4%, 122.7% and
43.2% respectively in 2013. The value of imports from America fell by 5.2% s in 2012 compared to
2013. In 2013, the import value from Europe increased by 74.2% between the same period, with a
corresponding increase in the share of import value to Europe from 20.0% in 2012 to 23.0% of total
import value in 2013. Moreover, the share of Imports value to United Kingdom (UK) increases from
7.1% in 2012 to 10.9% of total import value in 2013.
b) SETTING OBJECTIVES
We have to keep in mind that the plan should concentrate on the deficiencies over which we
have some influence.
Once these factors are determined, it is time to formulate a set of general objectives, which
establish the basis for all subsequent actions, justify future expenditures, and drive the cargo
marketing plan. These objectives should be aggressive but attainable, such as:
• Increasing the cargo throughput handled by the airport for a given year
• Focusing on increasing the number of air freight carriers
• Increasing the amount of perishable business handled by airport carriers (percent by year)
• Attracting additional integrator/express carriers (DHL).
• Promoting the airport services to attract new manufacturing companies to the region
Once the objectives are formulated, the design of a cargo marketing plan sets forth specific
actions necessary to achieve these goals.
EUROPE; 9%
US; 0%
ASIA; 82%
AFRICA; 9%
OCEANIA; 0%
EXPORT 2013
IMPORT
48%
EXPORT
52%

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Sky handling partner Ltd cargo terminal business plan slide share