EXPORTERS based in South Africa are uniquely positioned to meet the growing needs of the African market, one of the few beacons of hope in the global economy. Our country’s port system facilitates the free flow of inputs from around the world, and links South Africa to both the east and west coasts of Africa. This gives South African-based exporters a strategic advantage in a world looking to Africa to provide economic growth and business opportunities.
Africa is growing while the rest of the world is either slowing down or has not shaken off the full effects of the 2008 economic meltdown.
As recently as September, the UN Conference on Trade and Development (Unctad) stated in its trade and development report that “the world economy has not yet escaped the growth doldrums in which it has been marooned for the past four years, and there is a growing danger that this state of affairs is becoming accepted as the ‘new normal’”.
In contrast, the “new normal” for Africa is that “several large sub-Saharan economies (including Angola, Ivory Coast, the Democratic Republic of the Congo, Ethiopia, Mozambique, Nigeria and the United Republic of Tanzania) posted high growth rates, which is likely to result in 6 percent growth in the sub-region in 2014,” it added.
The Unctad report goes on to say that historically high levels of commodity prices have been supporting this growth for more than a decade in several countries, but other factors, such as improvements in agriculture and recovery from civil conflicts, have also played an important role.
While Africa is growing, the Chinese economy is slowing down. In the past week credit rating agency Moody’s Investors Service warned that China’s growth in gross domestic product could decline to less than 7 percent next year, compared with 7.3 percent this year. This was soon after AP Moller-Maersk of Denmark, the world’s largest container shipping firm, said it was experiencing slowing activity in China and other emerging markets, along with persistent weakness in Europe.
Contrast this with Africa, where it is increasingly becoming easier to do business.
A recently released DHL global connectedness index found that the sub-Saharan Africa region averaged the third largest increase in connectedness from 2011 to 2013 among all global regions.
In addition, five of the countries showing the largest increase in their scores – Burundi, Mozambique, Madagascar, Mali and Ivory Coast – are all located in the region, according to the DHL report.
South Africa’s port and supporting road and rail infrastructure put this market within easy reach of locally-based traders and exporters of manufactured and value-added goods. Our links to every manufacturing and trading bloc around the world allow companies based in South Africa to source components and raw materials from their suppliers of choice.
All of the world’s major shipping lines bring the world closer by making regular, scheduled and direct calls on our ports. These same ports serve as hubs for exports to the rest of Africa – through a combination of sea, rail and road links.
A further advantage for South African companies is that the complementary port model of Transnet Port Terminals is globally unique. It matches the strengths of individual industry needs to meet the needs of its main customers. Cargo can be re-routed between the different ports when there are delays caused by weather, congestion, natural disasters or technical problems.
Transnet Port Terminals is ready and willing to work with local exporters and importers to help them to take full advantage of the opportunities in the rest of Africa. The necessary infrastructure and systems are all in place.
Karl Socikwa is the chief executive of Transnet Port Terminals, South Africa’s port terminal operator managing 16 cargo terminals across seven South African ports