Ships around SA coast up 85% since December
Namibia, Mauritius benefitting
Countries with the capability to quickly scale up port and logistical operations could accommodate the increased demand for maritime services.
Africa’s inefficient and aging ports are hampering the continent’s chances of capitalising on a surge in ship traffic that’s avoiding attacks by Houthi rebels through the Red Sea, logistics experts said.
The number of vessels sailing around the southern tip of Africa is up 85% from the first half of December, when the Iran-backed, Yemen-based terrorists intensified their attacks on ships, according to Clarksons Research.
Some of the biggest beneficiaries are ports in South Africa, Madagascar, Mauritius and Namibia, all of which have seen volumes rise, manufacturing and logistics company Fictiv Inc. said.
"However, most ports in Africa are inefficient and not in the best condition to be able to fully realise all the benefits," said Vinny Licata, Fictiv’s head of logistics.
"This could be a real opportunity for Africa, but several ports were already congested due to inefficiencies. Investments are needed to enable them to compete."
Costs
Currently, Africa accounts for about 6% of global maritime trade, despite approximately 90% of its imports and exports being transported by sea, according to Freight Right Global Logistics chief executive officer and founder Robert Khachatryan.
Freight costs from Asia to the US East Coast are projected to increase by 20% to 30%, with delivery times extended by two weeks due to the longer route around the Cape of Good Hope in South Africa, said Khachatryan.
It’s here that South Africa’s port-infrastructure problems — ranging from equipment breakdowns to staff shortages — hurt its competitive advantage.
Shipping companies using the Cape route for east-west trade have largely avoided having to restock and refuel at South Africa’s maritime hubs due to their inability to provide services.
"This shift has directly benefitted strategically located ports like Toamasina in Madagascar, Port Louis in Mauritius, and Walvis Bay in Namibia, which lie along the east-west route connecting Asia with Europe" as ships avoid South Africa, Khachatryan said.
Increased demand
Countries with the capability to quickly scale up port and logistical operations — such as Morocco and Ghana — could accommodate the increased demand for maritime services.
"Their investment in port infrastructure in recent years positions them to manage the surge efficiently," Khachatryan said.
For other parts of Africa, "concerns arise from sea-piracy incidents near Somalia and Nigeria as vessels navigate around Africa," he said.
Rising traffic around the Cape of Good Hope could strengthen South Africa’s position in the BRICS club of nations and potentially in global trade negotiations in the longer term, said James Hill, CEO of MCF Energy Ltd.
"African policymakers may look at port-development strategies that will help to build intra-African and international connectivity," Hill said.
"Even after the conflict in Israel ends, the danger in the Gulf may continue as the Houthis may choose to retaliate against the US for their counterattack, meaning these benefits may continue." – Fin24/Bloomberg
The number of vessels sailing around the southern tip of Africa is up 85% from the first half of December, when the Iran-backed, Yemen-based terrorists intensified their attacks on ships, according to Clarksons Research.
Some of the biggest beneficiaries are ports in South Africa, Madagascar, Mauritius and Namibia, all of which have seen volumes rise, manufacturing and logistics company Fictiv Inc. said.
"However, most ports in Africa are inefficient and not in the best condition to be able to fully realise all the benefits," said Vinny Licata, Fictiv’s head of logistics.
"This could be a real opportunity for Africa, but several ports were already congested due to inefficiencies. Investments are needed to enable them to compete."
Costs
Currently, Africa accounts for about 6% of global maritime trade, despite approximately 90% of its imports and exports being transported by sea, according to Freight Right Global Logistics chief executive officer and founder Robert Khachatryan.
Freight costs from Asia to the US East Coast are projected to increase by 20% to 30%, with delivery times extended by two weeks due to the longer route around the Cape of Good Hope in South Africa, said Khachatryan.
It’s here that South Africa’s port-infrastructure problems — ranging from equipment breakdowns to staff shortages — hurt its competitive advantage.
Shipping companies using the Cape route for east-west trade have largely avoided having to restock and refuel at South Africa’s maritime hubs due to their inability to provide services.
"This shift has directly benefitted strategically located ports like Toamasina in Madagascar, Port Louis in Mauritius, and Walvis Bay in Namibia, which lie along the east-west route connecting Asia with Europe" as ships avoid South Africa, Khachatryan said.
Increased demand
Countries with the capability to quickly scale up port and logistical operations — such as Morocco and Ghana — could accommodate the increased demand for maritime services.
"Their investment in port infrastructure in recent years positions them to manage the surge efficiently," Khachatryan said.
For other parts of Africa, "concerns arise from sea-piracy incidents near Somalia and Nigeria as vessels navigate around Africa," he said.
Rising traffic around the Cape of Good Hope could strengthen South Africa’s position in the BRICS club of nations and potentially in global trade negotiations in the longer term, said James Hill, CEO of MCF Energy Ltd.
"African policymakers may look at port-development strategies that will help to build intra-African and international connectivity," Hill said.
"Even after the conflict in Israel ends, the danger in the Gulf may continue as the Houthis may choose to retaliate against the US for their counterattack, meaning these benefits may continue." – Fin24/Bloomberg
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