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Integrated multimodal transport network to unlock new markets

Article - February 28, 2016

Transport was a problem in Angola long before it became a priority, hindered by challenging terrain, centuries of neglect by Portugal’s colonial administrators and the ravages of the 1975-2002 civil war. Starting over virtually from scratch is seen by many Angolans as an opportunity to create the network of technologically advanced logistical platforms that will be needed as the country continues to rebuild and modernise


Aside from opening up new foreign markets for sectors such as fishing, mining and agriculture, a fully integrated network of port, rail, road and air transport-based logistical platforms is set to create jobs and reduce the country’s dependence on oil and natural gas, according to Transport Minister Augusto da Silva Tomás. It should likewise create the conditions for improved commercial ties between provinces and encourage a wider range of mobility and contact among people who share a common identity as Angolans.

Despite its difficult topography, Angola won the geostrategic lottery with around 1,600 kilometers (995 miles) of prime Atlantic coastline studded with numerous sites where deepwater ports can be built. Eventually these ports will serve as transfer points for oil, minerals and natural gas originating deeper inland or from landlocked neighbours like the Democratic Republic of the Congo (DRC), easing Angola’s near-total reliance on revenue from downstream petroleum operations to pay its import bills. It goes without saying that such a network is essential to connect the elements in an overarching infrastructure that adds value and cost efficiency to the services it offers.

Looming large on Africa’s western flank, Angola is a place where people are determined to make the most of their advantages. One of the government’s stated goals is to become the regional (and eventually continental) air traffic hub for trans-Atlantic and European flights to all of Africa and the Middle East. Taking that to the next level, they are working now on a full-service airport located 40 kilometres from the capital, capable of servicing giant Airbus 380 aircraft and carrying up to 13 million passengers plus 600,000 tonnes of airfreight on an annual basis.

That is not going to happen overnight, but the important thing to note is that planners have been careful to include connections, interfaces, flexible arrangements for space divisions, and other multi-function features that will allow the new airport to grow incrementally along with the traffic it will be called on to handle, now, later and for the long-term future.  

Such growth will be multimodal by definition. What use is Africa’s largest airport if you do not have access roads or a motorway to get you there from the city centre in time for your flight, a terminal to accommodate airfreight, or connections for passengers heading to destinations other than Luanda?    

“If the transportation system goes down, then the entire country grinds to a halt,” Mr da Silva Tomás cautions, and rightly so. His immediate priority is to expedite the entry of primary goods like construction materials, medical supplies and food, all of which Angola must import from abroad, and see that they get routed from the notoriously congested Port of Luanda, the gateway for the bulk of the country’s imports, to scattered population centres on the steep inland plateau that rises up from the coastal plain.

Over time, it is expected that the network will likewise move Angola’s exports, mostly minerals, through coastal ports such as Lobito, Namibe and Cabinda, as well as Luanda. Exports, in fact, justified the handful of railroad lines the Portuguese finally got around to building a century ago to carry Angolan coffee and Congolese copper down the inland escarpment to the Atlantic.

Three of those lines were totally destroyed during the civil war, but after hostilities ended, the government invested hundreds of millions of dollars in rebuilding and upgrading them. Now they are fully or almost fully operational after being outfitted with modern locomotives, bogies and rolling stock. The next phase involves extending those three lines – Benguela, the African continent’s longest rail line, plus the Luanda and Moçâmedes railways – to link with tracks in adjoining countries such as Zambia, Namibia and the DRC.

“Development corridors, logistical platforms and greater regional integration call for the implementation of an integrated network of transportation infrastructure,” insists Mr da Silva Tomás, and adds that to get the ball rolling, the government is prepared to make major investments in human resources and technological innovation.

Under the mandate he has been given, Mr da Silva Tomás has designated CNC, the National Council of Shippers, to oversee the system’s implementation and performance, and act as a regulatory body for its operations. It is a challenge that CNC’s former Director General, Francisco Agostinho Manuel Itembo, is confident will be met.

“Transparency and efficiency are key for growth at the global level and we adhere to international standards of good practice, which are also fundamental traits we seek in foreign partners”

Ruben N’Dombasi, Chairman of Unicargas

“CNC is working on creating the structures that will bring an international dimension to the national and regional economy, and reduce dependency on external sources, particularly those from overseas,” says Mr Itembo. “In that respect, a network of linked logistical platforms is meant to increase productivity by means of a sophisticated multimodal transport sector that is fully sustainable over the long term.”

CNC has been monitoring freight movements in Angola since 1978, acquiring a wide ranging familiarity with the managerial and technological know-how that it will need to call on in its new supervisory role. As Mr Itembo sees it, “There is no denying that linking road and rail platforms have great potential, especially over wide expanses of territory and geographically distant markets. So it is not a question of whether or not it is a good idea, but of how to make a good idea economically efficient.”

Operations involving the transport, transfer and warehousing of maritime freight are in capable private sector hands such as SEMEC, a specialist company dealing with customs, tariffs and other export-import paperwork for foreign shippers, as well as serving local importers.

SEMEC’s founder and director, Sergio Cubo, a Portuguese immigrant, was working in Angola when he spotted a start-up opportunity that looked well worth seizing. “Angola survives thanks to its imports,” says Mr Cubo, whose firm also arranges air freight or lorry transport for goods on the move. In that regard, he says he is more than happy to see customer costs go down now that turnover time for vessels at the Port of Luanda has been substantially reduced by the introduction of new cargo cranes. Moreover, an incentivised training program for employees is beginning to produce results.  

In the meantime, work proceeds on the new deep-water petroleum port at Caio Litoral in Cabinda province, the oil-rich enclave separated from the rest of Angola by a territorial flange of the DRC. Construction is set to soon shift into high gear amidst confidence that ships will be docking at its 32-metre loading platforms towards the end of 2016.

Deepwater facilities envisioned for Barra de Dande, 50 kilometres north of the capital, remain in the planning-and-review stage. But when completed, its eight platforms will make it one of Africa’s largest cargo handling facilities, even outpunching the huge port complex at Durban in South Africa.

At Luanda’s congested harbour, 70 per cent of incoming goods arrive in containers. Although bottlenecks are somewhat eased by rerouting them to four inland dry ports, Mr Cubo argues that such operations requiring constant unloading, reloading and in-between road transport have a negative impact on prices. “In practical terms, the Port of Luanda is choking on its own traffic, unable to service its users, but all the existing alternatives drive up prices without adding additional value to the freight itself,” he says.

Unicargas is a government-owned freight handling agency that is prepared to take over after an imported item has cleared customs and is readied for the final stretch of its journey, from the freight terminal to the customer’s doorstep. That may involve loading it onto one of the 350 lorries in its fleet. Unicargas vehicles adhere to rigorous pollution control standards overseen by a special unit that is a source of great satisfaction to its Chairman, Ruben N’Dombasi.

According to Mr N’Dom-basi, under a 20-year concession dating from 2005, Unicargas operates the multi-purpose terminal at the Port of Luanda that generates 90 per cent of company’s revenues. “Obviously, dependency on imports is bad for Angola but good for our business,” he says. “What the country needs, though, is to develop an export capacity and find a state of equilibrium.”

Mr N’Dombasi adds, “The government’s efforts to reduce its reliance on imports has had a negative effect on our balance sheet and shows that we have to develop other revenue sources.” That is one reason why Unicargas is committed to the strategic goals outlined by the transport ministry, and is preparing to establish its first logistical centres in Cabinda to be followed by another in Benguela.

Unicargas’ head would welcome foreign investment. Under its contract with the government, the company is responsible for all maintenance work and improvements at the terminal for the duration of the lease.  “We urgently need to upgrade our mooring quay, which is 536 metres long,” he says. “We also need to acquire moveable cranes because we are a multipurpose terminal and handle all types of shipments.”

Mr N’Dombasi is open to the idea of partnerships with companies based outside Angola “as long as it is the right partner and a partnership in the truest sense of the word”.  

With one of the steepest rates of economic growth in sub-Saharan Africa, at 4.4 per cent according to the Central Bank, Angola is attracting more than casual interest from private investors. It is hardly a secret that China’s gushing geyser of easy credit has been funding many big-budget reconstruction projects, sidelining Angola’s traditional trade and investment partners.  But many knowledgeable Angolans say they feel the entrepreneurial spirit and can-do mindset of the British may be what the country needs just now. They recall Sir Robert Williams, the Scottish railroad engineer and mining magnate, whose determination overcame major obstacles to build the Benguela Railway in the early decades of the 20th century.

Many are aware that BP has taken a multibillion-dollar stake in the country’s future in return for deep-sea drilling permits, and has pledged to top that sum up before the year is out. So it is no wonder that people like CNC’s former Director General Francisco Itembo believe “the practical experience and know-how the English are famous for would be a valuable asset in the economic and human development of this young nation.”  

He adds: “UK businesses ought not to hesitate about investing in Angola, given its political stability and overall economic growth potential. To that you add the potential of a country endowed with untapped mineral wealth and a workforce that is young and prepared to take on challenges.

“What you get is an immense, untouched market offering a variety of suitable opportunities for those countries that see it as a source of new wealth for their companies, their countries and, it goes without saying, for the Angolan people.”