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SPECIAL FEATURE Credit: Anton Swanepoel Terminal boasted a record of putting more than 500 000 fully-built-up units (FBUs) through the port. The figure includes FBUs that are not motor vehicles and includes vehicle imports. Toyota’s popular Fortuner is exported at a rate of about 150 per month. All aspects of the port are expanding or being upgraded. Within the Port of Durban there are a number of specialised facilities. Several projects are underway to increase capacity. Transnet National Ports Authority (TNPA) and Transnet Port Terminals (TPT) are combining to upgrade infrastructure and buy new equipment to improve efficiencies at the Ro-Ro terminal (vehicles and break bulk) and Maydon Wharf (mixed cargo and agriculture) but the biggest project is at the Durban Container Terminal (DCT). DCT has a capacity of 3.6-million TEUs (twenty-foot equivalent unit) and the current project aims to extend that beyond five-million TEUs. The Brics New Development Bank has approved a loan of 0-million for the DCT expansion project. TNPA states that the multiplier effect in the marine sector creates five jobs for every direct job. A large drydock project created direct jobs for 29 skilled employees. The Port of Richards Bay, 160km to the north-east of Durban and 465km south of the Mozambican capital of Maputo, handles more than 80-million tons of bulk cargo every year. Richards Bay is a deepwater port. Among its 13 berths are terminals that handle dry-bulk ores, minerals and break-bulk cargo. The Richards Bay Coal Terminal (RBCT), with capacity of 91-million tons per year, is South Africa’s primary portal for the export of coal. In 2020, 65 collieries delivered coal to RBCT. The quay of the RBCT is 2.2km long with six berths and four ship-loaders. The 276ha site contains a stockyard that can store 8.2-million tons while the terminal itself has a design capacity of 91-million tons per year. More than 900 ships visit RBCT every year. In 2020, 92% of South African coal went to Asia, with India and Pakistan being the biggest importers. Africa imported less than the previous KWAZULU-NATAL BUSINESS 2021/22 20
SPECIAL FEATURE year and made up a total of 5% of volumes while 3% went to Europe. Among the exporters which use RBCT are Anglo Operations, ARM Coal, Exxaro Coal, Glencore Operations South Africa, Kangra Coal, Koornfontein Mines, Mbokodo, Optimum Coal Terminal, Sasol Mining, South African Coal Mine Holdings, South Dunes Coal Terminal, South32 Coal Holdings (which is selling to Seriti), Tumelo Coal Mines and Umcebo Mining. Several junior miners also have rights. TNPA has approved in principle the construction of a floating dock near the existing Small Craft quay. TNPA will have to create new onshore infrastructure and do some dredging before it can call for tenders from the private sector to build the dock, which would be able to handle large and ultra-large cargo vessels. The authority that runs the ports at Durban and Richards Bay, TNPA, and Transnet Freight Rail (TFR) have been working with the private sector to try to improve efficiencies at both ports. Backlogs at Durban in particular have proved frustrating for exporters. Logistics company OneLogix has opened its own distribution hub in Umlaas because of crowded conditions and slow loading. The other entity involved in the loading and unloading equation, TPT, is investing R2-billion in new equipment to improve coordination between truckers, tax authorities, port staff and ship’s captains. Dube TradePort has facilities devoted to logistics, warehousing and export support. Proximity to the airport is vital and freight volumes are growing. Financing Four countries currently account for 41.7% of intra-African trade, according to the Export Credit Insurance Corporation of South Africa (ECIC). The ECIC has invested in the African Export Import Bank to boost intra-continental trade to 0-billion. The South Africa-Africa Trade and Investment Promotion Programme has the same goal. The ECIC provides export credit and investment guarantees, stepping in where commercial banks might be risk-averse to support private investment. Standard Bank has launched a product to assist African importers in evaluating and choosing Chinese suppliers. Faced with daunting variety, language and cultural differences, the prospect of having to pay cash upfront to unseen suppliers or limiting supply choices to a small group of previously used suppliers, African importers can use the Africa China Agent Proposition (ACAP) to validate quality while having sight of the logistics process. Standard Bank is using its partnership with shareholder the Industrial and Commercial Bank of China (ICBC) to create the ACAP, which puts importers in touch with agents and is underpinned by a letter of credit. Standard Bank is Africa’s biggest bank and ICBC is the world’s biggest bank. In preparation for AfCFTA, development finance institutions and banks have been developing methods of trading in local currencies, rather than hard currencies like the US dollar. The African Virtual Trade-Diplomacy Platform (AVDP) is a private-sector initiative by more than 20 companies (in partnership with the AU Commission) which will support the AfCFTA by enabling member states to participate effectively and securely. Banking groups such as Citi have been investing heavily in digital platforms related to payments infrastructure. Many African traders already do their banking on hand-held devices and so the market is ready for more innovation in taking digital payments further into the world of trade. Developing reliable cross-border payment platforms will be vital in supporting increased intra-African trade. The European Investment Bank is the investment arm of the European Union and often partners with African institutions. China has a wide range of financial entities which are active across a range of sectors in Africa. These entities include the China Development Bank (CDB), the China International Trade and Investment Corporation (CITIC), China Export and Credit Insurance Corporation (CECIC), China Export Credit Insurance Corporation (Sinosure) and the China Export-Import Bank. ■ 21 KWAZULU-NATAL BUSINESS 2021/22
