Rail limits Namport

A lack of a well-maintained rail network poses a risk to the success of the upgraded Walvis Bay port.

02 August 2019 | Infrastructure

While the expansion of the Walvis Bay port has been welcomed as a boon for the economy, the lack of a modern rail line to ship goods out of the port is seen as a limiting factor to the future success of the port that has come at a cost of N$4.2 billion.

In 2008, the Namibia Ports Authority (Namport) embarked on the expansion of the port that it said would serve countries such as Botswana, Zambia, and even the Democratic Republic of Congo and Malawi.

The massive investment in the port's infrastructure was not mirrored in Namibia's rail infrastructure, though. One analyst sees this as a potential bottleneck in the country's transport hub ambitions.

“We worked on the expansion of the port and turned a blind eye to the transport modalities, rail in particular. More volumes will arrive at the port, but how do you ship these volumes to their respective destinations successfully and on time,” says Brighten Simasiku, the director of the Namibia-German Centre for Logistics.

He acknowledged the existence of the road network but maintained that an investment in the rail infrastructure was paramount in advancing the port's hub ambitions.

“We have the little that is in existence and road infrastructure that is in good condition, but rail is paramount and is the primary paralleled to the expansion of the port. The lack of [a] modern and well-maintained rail network will certainly hamper the port's envisioned success.

“Most likely, there will be significant benefit, however the opposite is possible. If all systems are in place, improved customer service, honesty, integrity... we are likely to see a boost in our economy through this facility.

“However, if it will be business as usual I foresee a burden on taxpayers whereas we are to incur loses and start to bail Namport due to underutilisation of the port,” says Simasiku.

He is also of the opinion that the Walvis Bay port is expected to perform well against other competing ports in the region such as those in Lobito in Angola, Beira in Mozambique and Durban in South Africa.

“We have added advantages such as short turnaround times of about three days and reliable security where we need no escorts for cargo and shipments in our territory. It will boost and trigger business in nearby and far countries, hence transport operators are likely to use our port to increase efficiency on business in their respective countries,” says Simasiku.



Not the first to find fault

Simasiku, however positive about the investment in the port, is not the first to find potential problems related to its operations. Earlier this year, the Namibia Economics Association (EAN) released a damning report criticising government's investment in the port and identified lower tariffs at bigger ports and Walvis Bay's location away from key markets as potential hindrances to its hub ambitions.

In the report, the port's geographic location was deemed to not be strategic while it was felt that its distance to market was unfavourable.

It was also found that the port depended on a small domestic market and that it was not strategically located close to any major trading lanes. In addition, it was found that investment policies and taxation were not favourable while the port of Lobito in Angola and Durban in South Africa were found to be more competitive.

“With heavy investments in Angola's Lobito port, which is much closer to many landlocked countries with export-driven economic activities such as Zambia's copper belt, Namibia would not be able to compete,” the report's author, Rainer Ritter, was quoted as saying in local press.

Namport for its part has maintained that the port is perfectly positioned and a good investment.

“The project will cater for containerised cargo handling capacity well into the next decade. The port of Walvis Bay is ideally located to accelerate the growth of Namibia and the Southern African Development Community region as a whole by providing a gateway to the region, thus serving as a logistics hub,” the company said .

With the completion of the new container terminal, Namport's current TEU capacity will increased from 350 000 TEUs to 750 000 TEUs per annum, the company has maintained.

“The new container terminal project will add an additional 600 metres of quay wall length to the existing 1 800 metres, which will enable major rehabilitation of existing quay walls to occur with minimal disruption to operations,” said Namport.

Other projects lined up by the ports authority include the ambitious N$60 billion Walvis Bay Port – North Port project.

“The water area in front of this land will be developed to accommodate port operations, whereas the land will be developed to house various cargo handling terminals. The development of a dig-out basin, which will reclaim water area from within the land, is also envisaged. The primary reason for this is to allow direct access to the available land via the port,” Namport said of the project.

Bulk cargo handling terminals require large space, which the current port does not have available, Namport said of the rationale behind the project.

“Namibia needs a deep-water seaport at Walvis Bay with sufficient bulk handling capacity to cater for the demand of import and export of mining related cargo,” said Namport.

“Converting the existing container terminal back to a multi-purpose terminal by 2018 will provide some increase in bulk handling capacity to cater for demand until 2022, after which time this too will become insufficient for meeting demand,” it added.

Should commercially extractable oil be discovered off the shore of Namibia, the current port will not be able to accommodate the requirements of the oil exploration and drilling industry, Namport has also said in support of the project.

The new container terminal is expected to be inaugurated this Friday.

OGONE TLHAGE

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