Programme Director
Chief Infrastructure Economist, African Development Bank: Shemmy Simuyemba
Associate Director, Ernst & Young’s African Business Centre: Victor Kgomoeswana
Managing Director, CENIO: Hennie Heymans
CEOs of entities
Fellow SADC Industry Experts
Members of the media
Distinguished guests
I am privileged and honoured to be invited to address you today at this important Freight Intra-Africa Conference. The cross-border road freight transportation system plays a critical role in intra-regional trade.
In addition, an integrated and efficient regional freight transport network is critical for economic and social development of our countries. In the European Union, intra-regional trade accounts for almost 80% of their trade with the rest of the world, and most of this trade is truck-borne. But in the case of Africa, intra-regional trade accounts for a mere 12%. So, for us to unlock the economic value of intra-regional trade, we need to ask ourselves what is preventing Africa from trading with itself?
Ladies and gentlemen, in response to this question, African leaders attending the African Union Summit in Kampala in 2010 observed that intra-Africa trade is hampered by, amongst others, infrastructure backlogs in various parts of the region, which raises the cost of doing business. Amongst others, the Summit lamented the inadequacies and inefficiencies of our road, rail and port systems.
President Jacob Zuma, in his capacity as the African Union (AU) Champion of road and rail transport infrastructure projects on the North-South Corridor, is on record saying that Africa needs to mobilize over $480 billion over the next 10 years for infrastructure development. Surely, you will agree that this call is for us to have a sustainable freight infrastructure development network. But the question is what are we doing to respond to this challenge?
At this point, it is appropriate for me to point to you a range of initiatives, undertaken at various levels, to improve the regional freight logistics infrastructure to facilitate trade. The South African government has budgeted and approved R845 billion for infrastructure development over the medium term. A significant proportion, about R262 billion, of this investment is earmarked for transport infrastructure and logistics projects.
Furthermore, in line with the AU’s prioritization of the North South Corridor, the South African government will commit a huge proportion of the transport infrastructure expenditure on developing this corridor, which is one of the busiest corridors in the region. Most of you might be aware of the ongoing initiative to develop the logistics hubs along the Durban, Harrismith and Johannesburg corridor, which will serve as key links to the North-South Corridor, and ultimately service the entire region. Other regional transport nodal facilities under the radar of government are border posts.
Government is seriously concerned about delays and congestion at our key border posts, which threaten to reverse the gains in infrastructure investment. Beit-Bridge is bursting at the seams with traffic congestion and delays. In most cases, the delays at the borders are caused by operational inefficiencies, which result in duplication in processes. This is a serious cost to the economies of the countries that conduct their trade through this border post, in particular.
It is for this reason that Cabinet is looking into establishing a mechanism that will bring all border entities under a single command and control structure. I believe this will go a long way in addressing the fragmentation in border operations. Of course, the ultimate vision is to create one stop border operations to facilitate legitimate trade and travel across the borders.
Some of these challenges could also be pinned down to the traditional design and layout of our border posts. Our research has revealed a very interesting pattern with the design of traditional border posts. Almost all of them are either flanked by a mountain or a river.
Furthermore, the road infrastructure at the border posts is designed in such a way that it serves a funnel, with narrow approaches which channel all types of traffic to a single lane. This is a serious constraint which hampers traffic circulation in and around the border posts.
It also poses safety risks due to the mixed filing of traffic. This is one of the sad legacies of the past, which sought to restrict rather than facilitate movement across the borders. Having said this, we have also observed that some of the challenges relating to traffic circulation within the border precinct are related to the absence of regulation.
For instance, we have observed that there is a tendency to establish truck stops, and other similar facilities, at the ports-mouth. In one border post, it was found that there were approximately 10 truck stops, some of which were informal, within the vicinity of the port. They created serious congestion, including safety hazards just outside the border post.
I am equally concerned about the security of people, trucks and consignments at these facilities. This is why government is looking into developing a mechanism to regulate truck stops, with the aim of prescribing minimum safety and security standards for truck stops. We also intend to prescribe the distance between the location of truck stops and border posts, as part of de-congesting our borders.
Costs of doing business in Africa are very high, partly because of high transport costs, high costs of services and the erratic nature of their delivery. In order to break the cost cycle, there is need for improvement in infrastructure and more efficient use of the existing infrastructure at border posts.
Members states appear to have taken this direction, with the new infrastructure at Kasumbalesa border post (Zambia/DRC) and Chirundu border (Zambian side). There is also work going on at Nakonde/Tunduma border post (Zambia and Tanzania), as well as several other projects. The Zimbabwean government has also signed a concession agreement for the construction of new border post facilities at Beit-bridge.
Some of these infrastructure projects have been undertaken through Public Private Sector Partnerships, due to lack of the required investment finance on the part of governments. The result of such arrangements has been that the investors have to rely on the user-pay principle in order to realise a return on their investment. This has resulted in an undesirable increase in transit costs.
The exorbitant fees for using the facilities at Kasumbalesa are a case in point. Yes, the border post has been de-congested at Kasumbalesa, but there are reports that truckers are avoiding parking in the new facilities and are instead parking along the roadside on approaching the border in order to avoid the parking charges.
The lack of a viable railway connection system from port to hinterland is negatively impacting on the region, and has restricted landlocked countries from reaching their full potential. The congestion at road border posts, the risky transportation of dangerous goods by road and the damage that is being caused to the roads by truckers is clear testimony of this. It would be more cost effective if bulky cargo and less urgent consignments are transported by rail. This requires massive financial investment, and in South Africa we have already embarked on making this a reality.
As the Department of Transport in South Africa (DoT SA), in the last two years, we have embarked on a project to develop traffic flow optimisation plans through our major commercial border crossings.This is one of our contributions towards alleviation of border traffic congestion. During the 2013/14 financial year, we will begin to implement the recommendations emanating from this particular study. It is also important to mention that as DoT SA, we will be conducting a survey on the state of the regional infrastructure.
By March 2013, we will have accurate information at our disposal on the state of regional infrastructure with respect to, for example, the infrastructure investment needs and others that will help us in transport and logistics planning. As DoT, we are also concerned with the disharmony that exists with respect to road transport standards in the region. We are also embarking on a project which will contribute towards the implementation of the SADC protocol, in terms of harmonisation of road transport standards. These are just some of the regional projects that are in our strategic plan.
Be that as it may, these interventions will not yield the desired results if we allow un-roadworthy and overloaded vehicles to traverse our borders. In 2009, most of us heard, or read, about a fatal road crash at the Maseru Bridge, where approximately five people died after being hit by a truck with faulty brakes. What is even more disturbing is that this situation continues unabated at this particular border post.
Oshoek is another example where the driver of a truck hit the offices, and caused injury to the officials at the border post. We cannot allow such incidents of negligence, and greed, to continue to claim the lives of ordinary people. I challenge the road freight industry to assist government to rid our roads of unscrupulous operators, who do not comply with road regulations.
Finally, I wish to assure this audience today that I will pursue robust engagements with my colleagues in Cabinet to ensure that we provide adequate infrastructure, in order to enhance a seamless flow of traffic from the national road networks through to our border posts. But, as you all know, building roads is expensive, and the question we must all answer is how should government fund the development of road infrastructure?
I, therefore, look forward to the outcomes of this conference, particularly the practical solutions towards resolving the massive infrastructure backlogs in the region. On behalf of the Government of South Africa, I thank you all and wish you all the best in your deliberations over the next two days.
Thank you.
