Bulk Handling in Africa 2018

BULK

HANDLING in AFRICA

G U I D E

2018

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BULK HANDLING IN AFRICA 2018

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s publishers of the monthly magazine “Bulk Handling Today”, which is distributed primarily in South Africa, it is apparent that many companies are already doing work in the rest of Africa. If not, they intend to do so in the near future.

This publication enjoys a wide readership in print Susan Custers and electronically as we distribute it to mining houses, trade commissions etc, in Africa and internationally.

2018 Contents 4 6 10 12 14 18

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Keep this guide in your desk drawer – it’s going to be of invaluable help as you grow your business. Or check out www.bulkhandlingtoday.co.za where you’ll find all the details on our website.

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Susan Custers, Publisher

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Trends Influencing the Industry From Confrontation to Partnership The Good, the Bad and the Ugly ‘Tempting Times’ for World’s Top Miners Adding to their air fleet Junior Sector is Key to SA Mining Industry’s Future Productivity Points Turning the Tide?

Giant Mining Machines Second Scramble for Africa Outsource Fleets for Economic Survival WCA Expands Global Presence

Proprietor and Publisher: PROMECH PUBLISHING Tel: (011) 781-1401 Fax: (011) 781-1403 E-mail: bulkhandling@promech.co.za Website: www.promech.co.za Managing Editor: Susan Custers Advertising Sales: Lin Patricio DTP: Anne Rotteglia Disclaimer: Neither PROMECH Publishing nor its endorsing bodies will be held responsible for any errors or omissions in this publication and no responsibility will be borne by the publisher for the consequences of any actions based on information so published by Promech Publishing cc.

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Copyright

All material published in this guide is copyrighted to Promech Publishing cc. No part of the material may be quoted, photocopied, reproduced or stored electronically without prior written permission.

Back to Basics BULK HANDLING IN AFRICA 2018

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DIGITALISATION

Trends Influencing the Industry Whether over a few metres or thousands of kilometres – from refining, processing, and distributing to end users – the effective transportation of bulk materials is crucial to the success of a wide range of industrial entities.

N

o surprise then that, by 2020, the global bulk material handling market is expected to grow by almost US$5 billion and that by 2026 this market’s value, globally, will be $65.74b billion.

Rise in mining activities

This is according to a report by Transparency Market Research, which says that the drivers of this growth include a rise in mining activities, the growth of industrial infrastructure (in particular in emerging economies), increased automation, agricultural progress and innovation, and advancements in bulk materials products and technologies.

The report goes on further to state, “With many commodity prices on the rise, shallow growth returning to different end markets and most mining companies in better cost positions than in the recent past, companies now face some key choices as to where to invest and how to position themselves in the coming years.”

By 2020, the global bulk material handling market is expected to grow by almost US$5 billion and that by 2026 this market’s value, globally, will be $65.74b billion. This is according to a report by Transparency Market Research

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Tracking the Trends 2017 (9th edition), a report on the mining industry by Deloitte, notes a “mood of cautious optimism brewing in the mining industry for the first time in several years.”

Digital

For miners, the commodity cycle, cost and productivity pressure mean that all the low-hanging fruit have gone.

As such, innovation is needed to deliver the next wave of improvements. The potential for digital to reduce waste and create value is massive: eradicating execution waste by reducing process variability; eliminating process waste by enhancing decision making; reducing structural waste by automating

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The rise in mining activities is largely due to rising commodity prices and regulatory changes which have led to a significant change in the viability of mining on the continent.

BULK HANDLING IN AFRICA 2018

processes and improving systems; and removing design waste by using digital technologies in the design of new assets.

First, it states, as mines embrace digital, their core processes will become fully integrated, autonomous, remote and automated — capabilities made possible by a network of low cost, highly capable sensors that use internet of things (IoT) technologies.

mented across a number of countries' mining codes that will increase policy uncertainty among miners.

For instance, the South African government's decision to introduce a new mining code that hikes black ownership levels from 26% to 30% on top of a 1% levy on all revenues will increase costs for miners.

Fully digitised engineering and asset information will integrate with location-aware mobile devices to support an efficient and collaborative workforce.

In a similar vein, Namibia has proposed increasing the share of black ownership in companies (including mining companies) to 25%, as part of the broader Namibia Economic Empowerment Framework (NEEF), although it is yet to implement this.

Drones will be used for data collection, inspection, stock control, condition and safety monitoring.

3D printing of critical spare parts will reduce lead times and inventory.

The rise in commodity prices is such that it is believed by leading analysts that these are the best mining prospects the continent has faced in 10 years

Wearables will be used for field maintenance and real-time machine inspection instructions, improving operator-based care and safety. As a result of this shift, digital mines will operate with fewer people who possess different skills from those required today.

“Globally, 69% of mining companies are looking at remote operation and monitoring centres, 29% at robotics and 27% at unmanned drones.”

Government relations

The relationship between governments and mining companies has long been fraught with tension. On the one hand, some jurisdictions unquestionably target the mining sector for a disproportionate share of taxes and royalty fees, require adherence to stringent beneficiation and local content rules, and have been known to significantly delay, and even revoke, operating licences and permits.

BMI Research: Africa Investment Opportunities in Mining: Risk/Reward Analysis states that a key feature of Sub-Saharan Africa’s mining sector will be the on-going regulatory changes being imple-

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Between March and July 2017, the Tanzanian government imposed a total ban on the export of ores and passed laws that will raise the share of government ownership in mining companies to 16% while allowing it to renegotiate existing mining and energy contracts.

Other countries, including DRC and Kenya, have also announced intentions to reform their existing mining codes. In the case of the DRC this could involve raising the government's share of revenues through an increase in royalties on mining activities.

In Kenya, the government is looking to introduce reforms that will attract much needed investment into the domestic mining sector.

Nevertheless, the rise in commodity prices is such that it is believed by leading analysts that these are the best mining prospects the continent has faced in 10 years. It also coincides with a “unique period of synchronised global growth, presenting a number of opportunities.”

But will this remain the case?

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BALANCING ACT

employment prospects at the very moment that Africa’s need for jobs is rapidly increasing.

From Confrontation To Partnership

Mining and, indeed, the related oil sector should not be sunset industries in Africa. On the contrary, the sector holds great promise, and Africa enjoys a considerable comparative advantage vested both in its store of mineral wealth and in its human capital.

However, realising this vast potential requires a long-term, generational approach by all parties, not short-sighted resource grabs, tactical gains and reprisals. The goal is to win the long-term investment needed to develop our assets, which will in turn create and sustain jobs and provide much needed tax revenue. Instead of an antagonistic relationship it needs to become a symbiotic, win-win relationship.

Cradle to grave

An extract of the keynote address, Realising Africa’s Mining Potential, by Chief Olusegun Obasanjo, former President of Nigeria at the Mining Indaba, Cape Town, earlier this year.

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basanjo stresses the importance of establishing a necessary policy framework, a new narrative of the value of the industry to Africa. He unpacks some of the thinking and proposed actions behind the Zambezi Protocol, which seeks to improve trust between parties as a means to ensure longer-term investment horizons and improved competitiveness for Africa’s mining sector.

Corruption and rent-seeking, reflecting the difficulty of managing a fixed, immovable asset where there is little else going on in the economy Mining: in a crisis

Like agriculture, mining should be regarded as a critical engine of growth – what I would call a ‘flywheel’ of the economy, enabling activity across a range of other sectors.

Something must change if we are to deliver on our promise not just to make poverty a thing of history, but for Africa to play its proper role and make meaningful contribution to the global economy.

Mining has a critical role to play in all of this, given that the continent is so blessed with all manner of mineral resources. Yet this all-important sector is in crisis in Africa.

At the root of this crisis is a lack of trust between mining companies, governments and civil society.

A failure to tackle this crisis will result in serious, adverse implications for both economic growth and

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BULK HANDLING IN AFRICA 2018

Negative perceptions within African societies as to the value and role of mining are amplified in environments where there are few other opportunities. The popular narrative on mining is about huge profits made at the expense of the population – a ‘win-lose’ scenario.

In contrast, the communities around mines are heavily dependent on mining companies, frequently from cradle to grave. Yet often the very companies bringing this development have to deal with considerable interference, corruption and rent-seeking, reflecting the difficulty of managing a fixed, immovable asset where there is little else going on in the economy.

Rather than engage the industry and its supply chain as a long-term developmental partner, some governments have sought to target the sector with higher tax regimes and other redistributive mechanisms, including calls for beneficiation and value addition. The mining supply chain also has a role to play in supporting the industry and governments with additional job creation, skills transfer and partnership opportunities for local entrepreneurs.

In the interests of government

The overall health of the sector is intrinsically in the interests of government. Not just for reasons of long-term revenue, jobs and the prospects of industrialisation, but because many governments hold a direct stake in mining operations.

While the success of mining demands a partnership of common interest, and Africa’s young and everincreasing population demand jobs and growth, policy instability has planted the seeds for a vicious downward cycle.

Policy uncertainity

Policy uncertainty leads to investor uncertainty.

This in turn limits the pool of capital available and consequently many major mining investments are put on hold. As large mining companies rebalance their portfolios across the globe, seeking the best returns for the least risk, policy uncertainty drives them away and fuels a move to small-scale and less reputable mining companies, and eventual ‘de-evolution’ of the mining sector.

These smaller mining companies tend to have less

developed governance systems, which in turn increases the burden of regulatory oversight in an environment in which many governments have only limited capacity.

This can, in turn, result in further distrust and dissatisfaction by government and society, creating political pressure for even more change, not in the interest of the operating companies.

Zambia’s mining policy changes illustrate this cycle. With four major mining tax regime changes in five years, the country’s tax regime has offered precisely the opposite to the stability investors seek, with long-term consequences.

As Zambia’s Minister of Finance himself noted to parliament in April 2016, such policy prevarication invariably damages the country’s investor credibility which ‘is anchored on two themes: predictability and consistency. If somersaults are going to be our recipe,’ he said, ‘such will reduce investor confidence in our country.’

Getting it right

There are many good international examples out there from which we should – and must – learn.

Chile is one useful analogue. In 1972 Chile was recorded to have the ‘second worst economy in Latin America’, inflation had reached 500 percent, there were frequent strikes, ‘nationalisation, price controls and high tariffs were the order of the day’, and the state controlled more than two-thirds of economic output.

Yet from a low of US$4 000 per capita in 1975 in the wake of political instability, real income per person more than tripled over the next 30 years.

This transformation has been built on three pillars. The first was the institution of free market economic reforms in the mid-1980s by a team of bright young economists. The second pillar of economic transformation relied upon a massive increase in domestic copper production.

And third, growth in the economy really took off with democratisation in the 1990s. The transformation of this sector over a quarter of a century has been spectacular. In 1990, the private sector produced less than one-quarter of Chilean copper mining output.

By the end of the 2000s, while the state mining company Codelco was producing more than twice as much copper as it had done 20 years before; the private sector was producing two-thirds of the annual national output of six million tonnes.

In 1970 Chile produced the same amount of copper as Zambia; four decades later it produced eight times more.

Success stories

Chile is not alone: Botswana, Panama, Mauritania all offer other thought-provoking success stories.

It is easy to forget Botswana’s situation at independence in 1966. Possessing just 10km of tarmac road, it was then one of the least developed and

Chief Olusegun Obasanjo

poorest nations in the world, with a per capita income little over US$70. The majority of the population was dependent on subsistence agriculture.

There were then fewer than 50 university graduates and 30 000 people in salaried employment and a little over the same number of migrant workers, mostly employed in South Africa’s mines. Their remittances equaled one-fifth of Botswana’s total exports. Literacy was scandalously low, and there was scant access to health, sanitation, water, telephones, electricity, public transportation and other services.

In 1970 Chile produced the same amount of copper as Zambia; four decades later it produced eight times more Botswana depended then on British foreign aid not only to develop, but to survive.

Now Botswana’s per capita GDP is more than South Africa’s, nearly US$17 000 in purchasing power terms. Botswana learnt quickly how to gain maximum value from its natural resources, in this case, diamonds, establishing a productive relationship with De Beers.

In today’s environment, the quality of governance and policy attractiveness will inevitably become increasingly important differentiators in the performance of African countries. Indeed, as the World Bank has noted, after geological factors, governments are the single largest determinant of where mining investments flow globally.

Published in January 2018 by The Brenthurst Foundation. Africa’seconomic performanceby His Excellency Chief Olusegun Obasanjo From Confrontation to Partnership, Mining Indaba, Cape Town, South Africa, 4–5 February 2018 Mining Potential

BULK HANDLING IN AFRICA 2018

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The Good, the Bad and the Ugly Africa attracts 14% of the total global exploration spend - the same as Canada and Australia. In comparison, South America as a whole attracts 20%.

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n the continent, most of the spend goes to West Africa, with South Africa’s share a mere two percent. For the continent to grow it needs to attract exploration and for that to happen, it needs to attract investment.

Money equals investment. But for investment to take place, an enabling environment is key. With investors having so much choice in where to invest, if they are not happy with the conditions in a country, they will invest elsewhere.

It is important to understand what exploration is and means, something not many people do. “They think you explore, then mine and make money, but the reality is that only one in 100 projects comes about,” says Alan E Saad, Consulting Geologist.

Having a mineral in the ground is not the same as bringing it into production, he adds. “You need money to do it.”

Therefore, policy uncertainty affects investor decisions. In Africa, South Africa, the Democratic Republic of Congo (DRC) and Tanzania all have an uncertain regulatory environment. Various experts discussed this at the recent Junior Mining Indaba held in Johannesburg and attended by "Bulk Handling in Africa".

Current situation in Africa

“Good regulation balances the competing interests of stakeholders. Bad regulation does the opposite,” adds Otsile Matlou, ENSafrica's Chief Operating Officer. He maintains that both the DRC and Tanzania have over-regulated, while South Africa, a country where mining is pivotal, has for the past 10 years had a static and uncertain regulatory environment.

Having a mineral in the ground is not the same as bringing it into production; you need money to do it

Alan E Saad, Consulting Geologist

“Zimbabwe is showing a glimmer of hope if you listen to what it has to say, but this needs to be followed up very quickly by regulations to facilitate that glimmer to make it a tangible reality.”

The jury is not out

Sacha Backes, Senior Investment Officer, Mining Investment Division, International Finance Corporation agrees. “Despite Zimbabwe’s decision to revitalise the industry, no significant mining companies are flooding into the country. The big risk is that the country will attract short term investment companies.”

He adds that while South Africa has seen a dramatic change of leadership, key decisions in policy still need to be make. “In Tanzania and the DRC, there are also investor concerns, but the jury is not out yet. While investment into the DRC continues, it is below what it should be.”

Pattrycja Kula-Verster, Business Development Manager, JSE

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BULK HANDLING IN AFRICA 2018

Mike Teke, CEO Seriti Resources advises that South Africa, Angola, Botswana and Zimbabwe have all experienced recent

Junior MINING INDABA

leadership changes and that these are for the better. “We have also seen the appointment of people who understand and have experience in mining to key positions in government around the industry.”

The DRC and Tanzania have over-regulated, while South Africa has an uncertain regulatory environment

Otsile Matlou, ENSafrica's Chief Operating Officer

Pattrycja Kula-Verster, Business Development Manager, JSE, says the Canadian Stock Exchange is the top resource exchange globally in terms of attracting capital and is home to more mining companies than any other country. “We need to lobby for something similar to attract risk capital.”

Image credit: Wynand Vd Merwe

Sacha Backes, Senior Investment Officer, Mining Investment Division, International Finance Corporation

Mike Teke, CEO Seriti Resources, makes a pertinent point at the recent Junior Mining Indaba

BULK HANDLING IN AFRICA 2018

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INTERNATIONAL

‘Tempting Times’ for World’s Top Miners The world’s 40 largest mining companies have delivered an impressive financial performance in 2017, increasing revenue by 23% to USD$600bn.

T

his is according to PwC’s ‘Mine 2018’ report.

The report analysis confirms an upswing in the mining cycle, which comes on the back of rising global economic growth and a recovery in commodity prices. Helped by astute cost-saving strategies over the past few years, margins and cash-generating ability has improved significantly, leading to a 126% jump in net profits.

Michal Kotzé, Energy, Utilities and Mining Industry Leader for PwC Africa

Our 2018 outlook indicates that the Top 40’s improved financial performance will continue as companies continue to benefit from this upward momentum in the mining cycle.

Michal Kotzé, Energy, Utilities and Mining Industry Leader for PwC Africa, says, “For the world’s Top 40 Miners, 2017 was a remarkable year. We’re expecting the improved performance to continue into 2018 as companies continue to reap the benefits of the upswing in the mining cycle.

One of the risks currently facing the world’s top miners is the temptation to acquire mineral-producing assets at any price in order to meet rising demand “One of the risks currently facing the world’s top miners is the temptation to acquire mineral-producing assets at any price to meet rising demand. While we expect capital expenditure to increase next year as companies implement their long-term growth strategies, miners must be careful to maintain discipline and transparency in the allocation of capital.”

While the Top 40 Miners are enjoying a bounce back, miners will need to stay focused and deliberate in the pursuit of their long-term goals to create value for all stakeholders on a sustainable basis.

Balance sheets in good shape

Miners continued to focus on strengthening their balance sheets in 2017, with $25bn being allocated to the repayment of debt, and capital expenditure at a record low of $48bn. As a result, gearing has fallen from 41% to 31%, which is back in line with the Top 40’s 15-year average. With the liquidity concerns that were still lingering in 2016 now largely resolved, balance sheets are strong, and companies have the flexibility to act.

Andries Rossouw, Assurance Partner at PwC, says, “In 2018, we expect that favourable market conditions, higher commodity prices and strong internal discipline will produce increased liquidity and balance sheet strength.

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BULK HANDLING IN AFRICA 2018

Andries Rossouw, Assurance Partner at PwC

‘While we expect to see an increase in value and growth opportunities in 2018, we anticipate that this will be tempered by a continued focus on maintaining a robust and flexible balance sheet.”

Record high increase in tax contributions

Tax expenses increased 81% in 2017, with cash taxes paid to governments rising by 67%, even though corporate tax rates remained relatively stable across most key markets.

The jump in tax expenses was driven mostly by increased profit and the impact of US tax reforms, which saw a one-off four percent (or $2.8bn) rise in the effective tax rate due to a revaluation of deferred tax. It is expected that USA tax reforms will ease the tax burden on USA operations going forward.

Shareholder windfall

Shareholders returns have almost doubled yearon-year, from $16bn in 2016 to $36bn. Based on current levels of performance, dividends are likely to reach record highs in 2018.

“Shareholders who endured the 2008 and 2012 cycles will be keen to reap the rewards of their patience now that optimism and profits are back.

But the immediate temptation for larger returns – for shareholders or other stakeholders – must also be

GDP growth (%) The mining industry is cyclical, thanks to the lag between investment decisions and new supply. Demand tends to grow in a relatively stable fashion on the back of global economic growth. By contrast, supply is added in bulk when a new development is completed. (Source: IMF, PwC Analysis)

balanced against the on-going need to invest for sustainable long-term value,� says Michal.

New entrants staking their claim

2017 saw a range of new entrants active in the mining sector. Private Equity (PE) investors took a keen interest in mining investment opportunities, for example, and were active participants in almost every quality coal deal brought to market in Australia during the year.

There are also examples of non-mining companies partnering or merging with miners to secure access to commodities. For example, Agrium, a Canadian

fertiliser and chemical wholesale and retail company merged with the world’s largest potash producer, PotashCorp, while Tesla continued to invest in lithium supplies, including their recent transaction with Kidman Resources in Australia.

Safety better

In 2017 there was a 36% reduction in the number of fatalities among the 28 companies (of the Top

The increase in value and growth opportunities in 2018, will be tempered by a continued focus on maintaining a robust and flexible balance sheet

Top 40 reach and external market drivers. This world map illustrates the global production percentages of the key commodities. The Top 40in aggregate represents almost 50% of global production for key commodities such as iron ore,copper, manganese, cobalt and PGMs. (Source: USGS, World Bank, BMI Research, PwC analysis)

BULK HANDLING IN AFRICA 2018

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INTERNATIONAL

40) that disclose safety statistics.

Of these 15 reported that the number of injuries had either fallen or remained consistent compared will the previous year.

While an improvement in the safety record of the Top 40 is welcome news, there is clearly more work to do to ensure a safe working environment for all employees.

Impact on South Africa

Bulk commodities such as coal, copper, iron ore, zinc, manganese and chrome also showed remarkable price increases over the last two years. Miners of these commodities in Africa will reflect similar trends to those for the global mining industry.

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Unfortunately, precious metals haven’t done as well. The US-dollar gold price has remained relatively flat and platinum prices are at extreme lows. With higher input costs driven by input cost inflation, miners of these commodities are not experiencing the same growth as other commodities. They are still faced with the challenges of the bottom of the commodity cycle and job losses and mine closures are real risks.

PwC’s Mine 2018 analysis is based on the major Top 40 global mining companies by market capitalisation.

The results aggregated in the report have been sourced from the latest publicly available information, primarily annual reports and financial reports available to shareholders. www.pwc.com

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also accommodate three times as much volume.

More importantly, it will reduce the flight time between Johannesburg and Harare by over 35 minutes, ensuring an earlier arrival and later departure for DHL shipments from Lusaka.

This aircraft, which is the first of its kind for DHL in the Southern Africa region, will be the fourth B737-400F aircraft in its Sub Saharan Africa dedicated air network. The aircraft will carry out flights five days per week from Johannesburg.

“The increase in capacity of the new aircraft brings a new level of reliability and quality of service to the market. We will be able to adjust our aircraft operations to accommodate future increases in demand from the market by introducing even larger aircraft from our fleet where necessary. These developments will allow us to better fulfill our obligations to our customers both in Southern and Sub Saharan Africa,” says Malcolm

The new aircraft has a payload of up to 21 tons over the planned route, which is over 200% higher than the effective capacity of the ATR-72 aircraft previously operating on this route, and can

Macbeth, Vice President, DHL Aviation Middle East and Africa.

“The growth in business activity across the entire region, the development of international trade relations, and the expansion of companies into regional markets require that the express delivery market provide simple, fast and effective delivery solutions. The new aircraft reaffirms the commitment of DHL to develop and drive the express delivery market in Africa,” adds Hennie Heymans, CEO DHL Express Sub Saharan Africa.

The aircraft is equipped with a Category III C system which enables it to operate in unfavourable weather conditions. www.twitter.com/DHLAfrica

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SUSTAINABILITY

Junior Sector is Key to SA Mining Industry’s Future "Bulk Handling in Africa" attended the Junior Mining Indaba held in June 2018. For mining to be sustainable, it requires ongoing and extensive exploration. Junior miners are the principal drivers of exploration. Therefore, the emergence of vibrant small and medium scale enterprises is vital for the future of the mining industry. well as assist with issues of access to funding, geological information, compliance and access to markets in order to diversify ownership, participation and increase investment and job creation in the sector.”

Database

Currently the DMR database comprises over 90 companies. Most of these require funding which led the DMR to partner with the Industrial Development Corporation (IDC). “We are in the process of establishing a 'junior miners fund' to particularly focus on providing exploration investment capital to black owned emerging miners, considering that funding institutions are not willing to invest in this space,” the Deputyminister adds.

Deputy Minister, Godfrey Oliphant, Department of Mineral Resources (DMR)

“

We believe they are the future drivers of growth and sustainability of the sector and as a regulator responsible for ensuring the sustainable mining of the country’s resources, the Department of Mineral Resources (DMR) remains committed to support junior miners,” the Deputy Minister, Godfrey Oliphant, DMR told Junior Indaba delegates.

“For example, one area where junior mining can contribute is employment. With employment in the industry falling to just above 450 000 people, government believes this can change if we support junior miner initiatives,” he continues.

We are in the process of establishing a 'junior miners fund' to particularly focus on providing exploration investment capital to black owned emerging miners

“We have also started engaging the private sector to assist government by contributing a small portion of their turnover to this fund to keep it sustainable. We urge companies to heed our call and assist us.”

In addition, in partnership with the Department of Trade and Industry (the dti), the DMR has sponsored junior miners to travel abroad so they can attain Foreign Direct Investment (FDI) into their projects.

To date they have visited China, Canada, Turkey and Russia, among others.

Zama-Zamas

A key initiative is the transformation of former zamazamas in Kimberley into the Kimberley Artisanal Miners body. “We issued their mining permits on 30 April 2018, having successfully negotiated a tailings mining resource TMR (dump) from Ekapa Mining and access to 500 hectares of diamondiferous ground called floors for the miners. Some of them are already properly licensed to trade and deal in rough diamonds.”

This initiative has also reduced illegal mining.

Held at the Johannesburg Country Club in Auckland Park, the deputy-minister told the gathering that other than the Junior Indaba podium, the DME is not engaging with the junior miners which is one of the reasons it launched the Junior Miners’ Programme this year.

“This is to provide opportunities for new entrants identified throughout the mining value chain as

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BULK HANDLING IN AFRICA 2018

Oliphant adds that South Africa is a country alive with possibilities to better the lives of all. “Our country has potential to further grow the economy, stimulate industrial activities, attract socio economic investments and create jobs.

“As a regulator responsible for ensuring the sustainable mining of our resources, we remain committed to support junior miners, our door has always and will remain open to junior miners about the programme,” he concludes.

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By providing practical solutions to close the continent’s infrastructure gap, we serve the public and private sector alike.

Key clients include the private sector; national, provincial and local government departments of housing, transport, water and public works; as well as parastatals

Tema Port Expansion Ghana

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across a range of sectors including telecommunications, ports, roads, railways, electricity and energy supply and bulk water supply.

We are also an advisor and service provider to major development finance institutions such as: — The World Bank — The Development Bank of Southern Africa — The African Development Bank — The West African Development Bank — The Industrial Development Corporation — Millennium Challenge Corporation — Islamic Development Bank — Economic Community of West African States — Arab Fund for Economic and Social Development — Food and Agriculture Organisation — Many bilateral donor agencies.

Kasane International Airport Botswana

Bridal Veil Road Overpass Bridge South Africa

Some of our projects in Africa Niger

Morocco

— Environmental and social impact assessment for the Kandadji Program — Updating the socio-economic database and installing a GIS Unit Mali Senegal

— New Acid Production and Fertilizer Unit EIA — New Marrakech Airport

— Implementation of the resettlement action plan and support to the community affected by the Alatona Irrigation Project — Environmental and social impact assessment of the taoussa dam project

— Dakar to Thiès Rail Link, including link to Blaise Daigne International Airport — Major infrastructure and irrigation projects Guinea

— CBG Expansion Project: environmental and social impact assessment — Simandou Iron Ore Project Sierra Leone

— Radisson Mammy Yoko Hotel — Tonkolili Iron Ore Project Ghana

— Tema Port Expansion Project — IDC Airport City Hotel: due diligence — Halliburton LMP Facility: due diligence Takoradi Port — East Legon Shopping Centre Nigeria

— Kiri Dam Hydropower Project — Port Harcourt Base Gabon

— Electrification Master Plan Update — Port Gentil Deep Water Port — Fougamou Hydroelectric Project Democratic Republic of Congo

— Kinshsasa (N’Djili) International Airport: railway rehabilitation design review and project supervision — Monitoring of the environmental and social impacts of Pro-Routes — Grand Inga Dam Angola

— Brewery and Coke Manufacturing Plant — General Electric HQ, manufacturing building and warehouse — Luanda Bay — Temar Oil Facility Namibia

— Rundu Airport Runway Upgrade — Windhoek Masterplan: Bulk Water Supply

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BULK HANDLING IN AFRICA 2018

Botswana

— Kasane International Airport — Barclays Bank Botswana — Gaborone High Court (Court of Appeal) — Life Health Private Hospital

Libya

— 376 km section of the proposed coastal highway between Ras Ajdir and Misrata (Maghreb Highway) — Al-Kufrah to Uweinat Road Egypt

— Alexandria and Dekheila Container Terminals — Grand Museum of Egypt Rwanda

— — — — —

National University of Rwanda, Butare Campus Rwanda-DRC 400Kv Interconnector Kigali Master Plan Nyungwe Forest Lodge, Gisakuru Rusomo Hydro

Uganda — — — — — — —

Nyamba B Hydropower Feasibility Uganda –Kenya 400KV interconnector Mpigi- Kanoni- Sembabule-Villa Maria road upgrade Environmental Due Diligence for CNOOC’s well pad sites /work camps ESIA for Tilenga Field Development Project Kampala City Drainage Master Plan Unilever Kampala Office Fit-out Ethiopia

Kenya

— — — — — — — — —

— — — —

Rift Valley Railway Mall of Africa Nairobi Urban Toll Road Project Phase 1 Kenya Naval Dockyard Lessos Toro 400Kv Interconnector Itarre Dam Arror Dam Citi Bank-Mombasa office fit-out Kisumu-Nothern by-pass dual carriage way Olkaria VI Geothermal plant, TA Services QS Services for Tullow Oil at Turkana AFRICOM Property Due Diligence Services Kenya Pipeline Environmental Services.

— Mandaya and Beko Abo multipurpose hydropower projects — Environment, health and safety audits of 96 state-owned enterprises/Midroc Lega Dembi Gold Mine — Ethiopia-Djibouti Interconnector — Water modelling-capacity building — GE Addis Ababa office fit-out

Mozambique

— — — —

Beira Oil Terminal Greenfield Coal Export Rail Routes Maputo Port Development Pemba Airport Upgrade

Zambia

— — — —

Kabompo Gorge Hydroelectric Scheme: access roads Royal Chundu Zambezi River Lodge & Island Lodge Standard Chartered Bank Upgrading of gravel roads between Gwembe and Tonga

South Africa

— — — — — —

Kusile Power Station Western Cape Gas Distribution Shell Office design and fit-out Gautrain Rapid Rail Link Excelsior Wind Farm Durban Harbour entrance widening

BULK HANDLING IN AFRICA 2018

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Building Communities We offer enhanced services across the continent and maintain a project presence in several African countries. With top-level professionals in multiple locations, we understand Africa’s specific infrastructure needs and its challenges.

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BULK HANDLING IN AFRICA 2018

Bloemfontein T +27 51 448 2721 Bellville, Cape Town T +27 21 950 7500 Umhlanga Ridge, Durban T +27 31 204 3800 Sandton, Johannesburg T +27 11 666 2000

Nairobi, Kenya M +254 710 165 575 Maputo, Mozambique T +258 21 498 797 Lagos, Nigeria T +234 802 417 4152 Kampala, Uganda T +256 312 314 312

Productivity Points Wickus Botha, Africa Mining and Metals Leader at EY

As productivity remains the number one operational risk in the mining sector, digital transformation in the sector will be a critical enabler to addressing the industry’s productivity and margin challenges. Mining companies will be able to better manage variability and improve productivity by merging digital with a manufacturing mindset, which focuses on productivity across the endto-end value chain.

Closing the digital disconnect will position mines to be fit for purpose for the future, ensuring practical and sustainable solutions. However, many mining companies are yet to seize the advantages of digital. The current rate of digital progress is out of sync with their scale of opportunity. EY’s global report, The digital disconnect: problem or pathway? found that 31% of 700 global respondents in the sector say digital is high on the agenda for their organisation, while 15% say it is not on their agenda at all.

Other examples where mining and metals companies seized digital opportunities include: 1. Optimising production plans and productivity rates across any operation and managing variability under any conditions. Combining detailed ore body data with digitised equipment performance and maintenance data, in a real-time environment, allowed scenario analysis of alternative operating plans, and the ability to refine these plans for variability.

2. Enhancing asset availability and reliability. A move to digitally enabled predictive maintenance allows for the extension of maintenance windows, reduced component and labour costs, and the minimisation of costly breakdown events. Further, once the effective maintenance practices are standardised, the introduction of robotic process automation (RPA) and schedule optimisation tools is possible.

3.

Understanding true end-to-end capability An example is a mine that uses digital technology and systems bottlenecks, and supporting to track equipment and employees through loss elimination, is fundamental to a A pragmatic the entire operation. It allowes them to manufacturing excellence mindset. optimise the utilisation of equipment, digital strategy starts reduce stoppages, minimise bottlenecks with clarity of purpose and 4. Increasing agility and responsiveness to changes in market and improve asset productivity and factors, such as freight rates understanding where it utilisation. and customers’ buying behaviour will create value This mine shows the potential that can be trends. This would optimise shipping reached in terms of both productivity and and scheduling to reduce demurrage, safety. A pragmatic digital strategy starts with maximise port utilisation and also enable clarity of purpose and understanding where it will create miners to capture spot markets and price premiums value, supported by an over-arching, integrated 3-5 year via sales contracted at different points of the value roadmap of digital initiatives that are margin accretive. chain (eg, on the water sales).

Key is understanding what that requires in terms of governance, leadership, culture, capacity, capability, and www.ey.com digital process maturity.

Increase your stockpile capacity by up to 30% BULK HANDLING IN AFRICA 2018

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Turning the Tide?

The global economy seems to be leaving the legacy of the global financial crisis of the past decade behind, with about half the world’s countries experiencing an increase in growth.

T

his is according to The World Bank’s Global Economic Prospects, June 2018: The Turning of the Tide? However, while the Report says all the consensus forecasts for 2018 and 2019 reflect optimism, “increasing corporate debt in some emerging market economies has left them especially vulnerable to interest rate and exchange rate shocks”. It adds: “ And the prospects for commodity exporters will be limited as the major commodity-importing countries, especially China, shift their demand away from oil and other commodities”.

In the foreword of the report, Shantayanan Devarajan, Senior Director, Development Economics, Acting Chief Economist says this reinforces the January 2018 edition of the Global Economic Prospects report, that while current growth appears robust, potential growth will be lower.

“The implication is that policy and institutional reforms that build human capital (to make labour more productive) and improve the business climate (to increase investment) Growth in EMDEs are needed now more than ever. The still robust pace of growth provides political space to implement these reforms.

Now is the time to act,” he states.

Global growth has eased but remains robust, although with downside risks. In commodity exporting economies, in particular, the expected slowdown in commodity demand growth from major emerging markets weighs on long-term growth outcomes Global outlook

Global growth has eased, but remains robust and is projected to reach 3.1% this year. Over the next two years, it is expected to edge down as global slack dissipates, trade and investment moderate, and financing conditions tighten.

For the first time since 2010, the long-term (10-yearahead) consensus forecast for global growth appears to Contribution to EMDE growth have stabilised. Although this development could signal that the legacies of the global financial crisis are fading, past experience cautions that long-term forecasts are often overly optimistic. While well below levels expected a decade ago, these forecasts also remain above potential growth estimates.

In Emerging Market and Developing Economies (EMDEs), growth in commodity importers will remain strong, while the rebound in commodity exporters is projected to mature over the next two years.

Regional perspectives

A cyclical recovery is underway in most EMDE regions Activity in EMDEs EMDE growth has generally continued to strengthen, mainly reflecting the ongoing cyclical recovery in commodity exporters.

Domestic demand, particularly investment, has firmed in commodity exporters and remains robust in commodity importers. Highfrequency indicators have for the most part remained solid, but they are showing signs of softening.

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BULK HANDLING IN AFRICA 2018

GDP and demand component growth in EMDEs

CONTINENT OF AFRICA

that host a substantial number of commodity exporters.

Over the next two years, the upturn in these regions is expected to mature, as commodity prices plateau. Robust economic activity in EMDE regions with large numbers of commodity importers is forecast to continue. However, risks to the growth outlook continue to tilt to the downside in many regions.

The Role of Major Emerging Markets in Global Commodity Demand EMDE growth is expected to reach 4.5% in 2018. The rebound in commodity exporters has continued, and activity in commodity importers remains robust. Beyond this year, however, EMDE growth is projected to strengthen only slightly, approaching its potential pace, as the recovery in commodity exporters matures. Over the forecast horizon, commodity exporters and importers will see uneven progress in per capita income growth, which is projected to remain subdued in Sub-Saharan Africa (SSA).

Business confidence in EMDEs

Rapid growth among the major emerging markets over the past 20 years has boosted global demand for commodities. The seven largest emerging markets (EM7) (Brazil, China, India, Indonesia, Mexico, the Russian Federation and Turkey) accounted for almost all of the increase in global consumption of metals and two-thirds of the increase in energy consumption over this period.

As these economies mature and shift towards less commodity-intensive activities, their demand for most commodities may level off. While global energy consumption growth may remain broadly steady, global metals and foods demand growth could slow by one-third over the next decade. This would dampen global commodity prices.

Robust economic activity in EMDE regions with large numbers of commodity importers is forecast to continue

Industrial production growth in EMDEs

For EMDEs that depend on raw materials for government and export revenues, these prospects reinforce the need for economic diversification and the strengthening of policy frameworks.

Corporate Debt: Financial Stability and Investment Implications Average corporate debt in EMDEs has increased over the past decade, raising concerns about their financial stability and growth prospects. Debt service costs of EMDE firms are expected to rise as advanced economies normalise monetary policy, and debt is increasingly held by firms with riskier balance sheets. Elevated debt may be associated with weak investment growth, especially in large firms.

Countercyclical and macro prudential policies can address financial stability concerns that are raised by these trends. Structural policies, including the strengthening of bankruptcy regimes, are appropriate tools to address the investment implications of sizeable corporate debt.

Metals Metals prices, which increased 24% in 2017 due to robust global demand and environmentally-driven supply cuts in China rose modestly in the first quarter of 2018.

Prices posted further gains in April, after the imposition of US sanctions on a large Russian aluminium producer.

Manufacturing PMIs in EMDEs Commodity markets Crude oil prices rose substantially over the first half of 2018 amid robust demand and supply concerns related to recent geopolitical developments, despite rising US oil production. Metals prices increased in the first half of the year following a pickup in demand from China.

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CONTINENT OF AFRICA Metals prices are expected to increase 9% in 2018, reflecting strong demand, but then moderate in 2019.

Upside risks to prices include stricter pollution-control policies in China or stronger-than-expected demand, since China accounts for about half of global metals consumption. A broadening of sanctions on key metals producers could also lead to higher prices.

Commodity-exporting EMDEs After a strong rebound in 2017, activity in commodity exporters has continued to pick up in 2018. The recovery is expected to continue in a majority of countries in this group.

Share of EMDE commodity exporters with increasing/decreasing growth

Over the forecast horizon, commodity exporters and importers will see uneven progress in per capita income growth, which is projected to remain subdued in SubSaharan Africa (SSA)

Almost all economies that experienced a recession in the past two years — about 20% of commodity exporters in 2016 and about 10% in 2017 — are expected to see positive growth this year.

Many commodity exporters have eased monetary policy as inflation moderates (e.g., Mozambique, Uganda, South Africa and Zambia).

Although fiscal consolidation continues, its pace has generally diminished as revenues from commodity exports increased. Higher commodity prices and robust trade have supported the ongoing recovery.

Against this backdrop, investment is rebounding in more than two thirds of commodity exporters. This partly reflects increased commodities production (e.g. Nigeria) as well as large infrastructure investment programmes (e.g. Cote d’Ivoire and Senegal).

Private consumption is also recovering (e.g. South Africa and Zambia), boosted by wage gains, improving labour markets, and stronger consumer purchasing power amid moderating inflation and firming currencies. To varying degrees, export and import growth in commodity exporters have generally continued to recover, as domestic demand strengthens and global trade remains robust.

Contribution to investment growth in EMDE commodity exporters

Figure 1.12.D. Growth in commodity-exporting EMDEs

Contribution to growth in EMDE commodity exporters

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BULK HANDLING IN AFRICA 2018

Activity in EMDE commodity exporters The recovery in commodity exporters continues to reflect improvements in large economies, but it is also broad-based across countries. Investment is strengthening amid higher commodity prices and greater monetary policy accommodation. Despite a notable increase in energy prices, growth in many energy exporters continues to lag behind that of other commodity exporters, mainly due to ongoing production cuts

ss

rs

Low-income countries (LIC)

Growth in low-income countries (LICs) is expected to rise to 5.7% in 2018 and to an average of 6.1% in 2019-20, from 5.5% in 2017. This upswing reflects rising mineral production, spurred by higher oil and metals prices, improving agricultural output, and continued infrastructure investment. However, poverty headcounts are projected to decline only slightly. The main downside risks to the outlook are lower commodity prices, heightened policy uncertainty, and weak implementation of reforms.

Outlook Growth in LICs is expected to pick up to 5.7% in 2018, and strengthen to an average of 6.1% in 2019-20, slightly below the level reached earlier in the decade.

This upswing is predicated on firming commodity prices and policy actions to tackle macroeconomic imbalances.

These forecasts are higher than in January, and reflect a stronger than expected recovery in some metals exporters, as higher metals prices help boost mining production.

In metals exporters such as Mozambique, growth will remain subdued, reflecting the effects of rising debt levels on investor sentiment. The recovery in oil exporters will also be slower than previously envisioned, as the fiscal adjustment that is still needed to stabilise government debt is expected to weigh on growth.

Growth among non-resource-intensive countries is expected to remain robust, supported by increasing agricultural production, high public investment levels, and rising remittance flows, with the larger economies expanding at a faster pace.

Although growth in Ethiopia — the largest LIC — is projected to soften as policy tightens to contain inflationary pressures, it will remain high. In some smaller economies (e.g. The Gambia), improved political stability will allow for a modest pickup in activity, as opportunities for reforms boost investor sentiment; however, in fragile countries, security concerns will continue to weigh on investment (e.g. Burundi).

Per capita GDP growth is projected to rise from 1.6% in 2017 to 2.3% in 2018, and to an average of 2.5% in 2019-20. Nonetheless, the effect on poverty alleviation seems likely to be subdued.

Contribution to metals demand growth

The proportion of the Lower Income countries’ population below the poverty line is higher in SSA than in other regions, reflecting the relatively slow decline in poverty levels among fragile countries and metals exporters in SSA

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The poverty headcount among LICs is projected to decrease only modestly, and decline most slowly among fragile countries and metals exporters in SSA. Higher population growth is worsening the poverty headcount.

Furthermore, growth for a significant proportion of LICs in SSA centres around capital-intensive sectors, which contribute less to poverty reduction (Bhorat and Tarp 2016).

These structural constraints will prevent faster poverty reduction unless structural reforms are introduced to increase productivity and support economic diversification.

Risks Risks to the outlook remain tilted to the downside. On the external front, a large drop in commodity prices could have a significant impact on sentiment toward LICs, given that many of these countries depend on extractive industries.

A collapse in oil and metals prices would also severely undermine efforts at fiscal consolidation and to rein in the public debt burden, and crowd out poverty-reducing expenditures.

On the domestic front, while political uncertainty has

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declined in some LICs, it remains a key risk for growth and reform momentum. For example, in Ethiopia, political tensions could intensify following the reimposition of the state of emergency. Risks to debt sustainability are also high in some LICs. Inadequate fiscal adjustment or large currency depreciation could lead to an increase in the cost of servicing external debt. Based on the LIC debt sustainability framework, The Gambia and Ethiopia are deemed to be facing high risk of debt distress.

Chad and Mozambique were rated as in debt distress by end-2017. In addition, most LICs remain highly vulnerable to weather-related shocks, and a return of drought conditions could severely disrupt ongoing recoveries.

Real commodity prices

A large drop in commodity prices could have a significant impact on sentiment toward LICs, given that many of these countries depend on extractive industries

Average growth in GDP, population, energy and metals consumption, 1996-2016

Cumulative growth in GDP, population, energy and metal consumption, 1996-2016

Share of global commodity consumption

Developments in commodity markets Consumption of commodities has surged over the past 20 years. Growth in consumption of metals, particularly aluminium, has been much faster than GDP and population growth, while energy consumption growth has been slower than GDP growth.

GDP growth

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BULK HANDLING IN AFRICA 2018

CONTINENT OF AFRICA Sub-Saharan Africa

Growth in Sub-Saharan Africa is projected to pick up to 3.1% in 2018, from 2.6% in 2017. This upswing reflects rising oil and metals production, encouraged by higher commodity prices, improving agricultural conditions, and increasing domestic demand.

Growth is expected to firm to an average of 3.6% in 2019-20, as the recovery strengthens in Angola, Nigeria, and South Africa — the region’s largest economies.

Nevertheless, growth will remain below its long-term average, with continued weak convergence of per capita income towards average emerging market and developing economies levels.

Tighter global financing conditions and weaker-thanexpected commodity prices are the main external downside risks to the regional outlook. Domestic risks include heightened conflicts, delayed fiscal adjustment, and weak implementation of structural reforms.

Outlook

Metals production

Growth in Sub-Saharan Africa is projected to pick up to 3.1% in 2018, slightly below January forecasts, and to firm to an average of 3.6% in 2019-20, as the recovery strengthens in the region’s largest economies.

These forecasts are predicated on the expectations that oil and metals prices will remain stable, external financial market conditions will continue to be supportive, and governments in the region will implement reforms to tackle macroeconomic imbalances and boost investment.

Among the region’s largest economies, Nigeria’s growth forecasts are lower than in January. While the oil sector is expected to continue to support the recovery, oil production is likely to be less than the government’s projections, due to capacity constraints. Growth in the non-oil industrial sectors is also likely to remain subdued as structural constraints slow efforts to attract long-term investments.

The growth forecasts for Angola and South Africa have been revised slightly upward. In Angola, the revisions reflect the expectation that a more efficient allocation of foreign exchange, rising natural gas production, and improved business sentiment would help support the rebound in economic activity. In South Africa, the pickup in business confidence is expected to help sustain the ongoing recovery in investment.

Investment growth

Rising mining output as new projects come on line, combined with stable metals prices, are expected to boost activity in some metals exporters

Elsewhere, rising mining output as new projects come on line, combined with stable metals prices, are expected to boost activity in some metals exporters (e.g. DRC and Zambia); in others, growth is expected to remain subdued as high government debt levels weigh on the private sector (e.g. Mozambique).

Among oil exporters, growth is projected to moderate but remain solid in Ghana, as the effects of high oil production gradually dissipate. However, the recovery will be slower than anticipated among oil exporters in the CEMAC region, reflecting the need for continued fiscal consolidation to stabilize debt levels.

In non-resource-intensive countries, growth is expected to remain robust, supported by improving agricultural conditions, infrastructure investment, and household demand.

Low inflation, a rebound in private sector credit growth and rising remittance flows are expected to boost consumer spending. The larger countries will continue to grow faster

Current account balance

BULK HANDLING IN AFRICA 2018

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CONTINENT OF AFRICA (e.g. Côte d’Ivoire and Ethiopia) than the smaller ones, due to their stronger policies and institutional capacity.

In Malawi, for instance, growth is expected to be lower than anticipated, reflecting the adverse impact of a dry spell and the spread of the fall armyworm — a pervasive agricultural pest—on food production.

Although per capita income growth in the region will turn positive, it will remain well below its long-term average, and also below the emerging market and developing economy (EMDE) average. The weak convergence of per capita income toward EMDE levels reflects the slower pace of per capita growth among oil and metals exporters.

Fiscal balance Economic activity Economic activity in Sub-Saharan Africa rebounded in 2017, helped by a turnaround in the region’s largest economies, and has continued to strengthen. Recent indicators suggest that metals production and fixed investment growth have picked up in the region, as commodity prices stabilised. However, oil production has risen at a slower pace in some oil producers, partly due to maturing fields. While current account deficits are increasing, due to a pickup in import growth, fiscal deficits are narrowing helped by higher oil prices and an increase in domestic revenue in some cases.

The region’s poverty headcount, at the international poverty line is projected to decline only slightly over the 2018-20 period, and decrease more slowly among metals exporters and fragile countries. Renewed progress on poverty reduction will require a sustained acceleration in per capita income growth.

Structural reforms that increase productivity and support export diversification would be critical to these efforts.

Risks Risks to the regional outlook remain tilted to the downside.

On the external front, a faster-than expected tightening of monetary policy among advanced economies could diminish investor appetite for higher risk assets in frontier markets, which would be particularly difficult for countries that rely on foreign debt financing to support large current account deficits. Sudden capital outflows could trigger large currency depreciations in some countries.

A sharp decline in commodity prices would have a significant adverse impact on the region, given the heavy dependence of many economies on commodity exports.

A possible trigger could be a slowdown in Chinese growth given the risks posed by interest rate hikes or trade tensions with the US. A collapse in oil and metals prices would severely undermine efforts at fiscal consolidation, derail progress in reining in the region’s debt burden, and undermine investor confidence.

Growth

Growth in Sub-Saharan Africa is projected to pick up to 3.1% in 2018, from 2.6% in 2017, reflecting rising oil and metals production, encouraged by higher commodity prices, improving agricultural conditions, and increasing domestic demand On the domestic front, political transitions have opened opportunities for reforms in several major SSA countries (Angola, South Africa and Zimbabwe) that, if implemented, could bolster the regional outlook. Policy reforms in Nigeria to improve the business environment could advance faster than expected, and significantly boost non-oil sector growth.

However, the risk of worsening political instability, and a concurrent weakening of needed reforms, remains high.

Indeed, some of the region’s largest economies, such as Ethiopia and Nigeria, are particularly vulnerable to an uptick in social unrest.

Growth per capita

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BULK HANDLING IN AFRICA 2018

Risks to debt sustainability are also high in the region.

Heavy reliance on commercially-priced debt could lead to debt service difficulties in some countries, includ-

ing Ghana, Nigeria, and Zambia (interest payments on government debt as a share of tax revenue in 2017 was estimated at more than 40% in Ghana and more than 25% in Nigeria and Zambia).

Meanwhile, the Ebola outbreak in the DRC has been assessed as a very high health risk, and could affect economic activity in the country as well as in the subregion, if it spreads rapidly to major urban centres and into neighbouring countries.

The recurrence of drought is a further significant downside risk. Droughts that started after 2015 have lasted longer in SSA than in other EMDE regions. A sudden return of drought conditions could severely disrupt the ongoing economic recovery in the region.

Composition of public and publicly guaranteed external debt over time Outlook and risks Growth in the region is expected to pick up this year and firm in 2019-20, reflecting a gradual recovery in the region’s largest economies, and continued robust growth in non-resourceintensive countries. However, per capita income growth will remain below its long-term average, and also below the EMDE average, reflecting the slow pace of per capita growth in oil and metals exporters.

Share of countries where droughts starting after 2015 persist

(Source: World Bank. 2018. Global Economic Prospects, June 2018: The Turning of the Tide?

Washington, DC: World Bank. doi: 10.1596/978-1-4648-1257-6.

License: Creative Commons Attribution CC BY 3.0 IGO)

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LI???G

TrANSPOrT PrOJECT

Giant Mining Machines “We recently completed the testing cross-border transport of two Magra thickeners from client Magra Process Engineering’s manufacturing plant in Vereeniging to Kwekwe in Zimbabwe,” reports Johan Truter, CEO of Imperial Managed Solutions.

Johan Truter, CEO, Imperial Managed Solutions

M

agra thickeners are used in the mining industry. Each unit weighs just under 30 tonnes and is 11m long and 6m in diameter. This was the largest project of its kind ever undertaken by Imperial Logistics.

“What made it unique and especially challenging was the tonnage of the load combined with the abnormal metric dimensions of these single units,” Johan expands.

The load travelled through Gauteng, Mpumalanga and Limpopo before crossing into Zimbabwe “It is an incredible feat to complete such an intricate project, but we have never been afraid of a challenge and credit is due to a large team of people who worked tirelessly to pull this off successfully.”

1 000km journey

He reveals that plans to move “these giants” started in August 2017. “Meticulous analysis and route planning were required to avoid cargo damage along the way. Police escorts and abnormal permits had to be arranged. Eskom and Telkom were alerted to lift power and telephone lines 35 days before D-day.”

On the day of departure, the Magra thickeners were loaded onto trailers with two cranes; a process

that Johan says took about four hours per Magra to complete.

“Once on the road, the vehicles travelled a maximum of eight hours per day at a speed of no more than 50km/h, always escorted by a police vehicle. The load travelled through Gauteng, Mpumalanga and Limpopo before crossing into Zimbabwe. It was a 12-day journey of more than 1 000km.”

Looking ahead

The company’s vast experience and expertise in this specialised field as well as a close working relationship with its client, ensured the project’s successful completion. Since July 2015, Imperial Logistics has transported more than 100 out-ofgauge loads for Magra, ranging from 20-tonnes to more than 40-tonnes of equipment.

Looking ahead, Johan says this year they will be moving another four Magra thickeners as well as abnormal construction units for an exothermic smelting plant in Zimbabwe.

“Our partnership with Magra and the specialised capabilities that we are honing means we are well placed to serve other clients on similar projects in future,” he concludes.

Imperial Logistics www.imperiallogistics.co.za

BULK HANDLING IN AFRICA 2018

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“THE LINK FOR AFRICAN TRADING”

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BULK HANDLING IN AFRICA 2018

TRANSNET FREIGHT RAIL

www.transnetfreightrail-tfr.net

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The South African Institute of Materials Handling

Sample

The South African Institute of Materials Handling (SAIMH) is a Non-Profit organisation set up with an objective to encourage the transfer of knowledge associated within the fields of Bulk Materials Handling (conveyors, stacker, reclaimers, tipplers, train loading systems, etc.) through a combination of seminars and networking sessions.

The SAIMH is made up of professional engineers, each practising their trade in a variety of organisations who volunteer their time to execute the SAIMH’s objective. The main aim is thus to promote the advancement of the art, science, theory and practice of the Bulk Materials Handling principles and techniques.

Company Affliates as at May 2017 Afripp Projects cc Brelko Conveyor Products (Pty) Ltd Bulkcon CPM Engineering CT Systems cc Conveyor Watch (Pty) Ltd David Brown Gear lndustries (Pty) Ltd ELB Engineering Services (Pty) Ltd Engicon Systems (Pty) Ltd Facet Engineering cc Flexco (SA) (Pty) Ltd

Hagglunds Drives SA (Pty) Ltd Hansen Transmissions SA (Pty) Ltd Hatch Goba (Pty) Ltd lllustech J & A Engineering Services Kimrae Engineering Prolects Loadtech Load Cells (Pty) Ltd MacsteelVRN Martin Engineering Melco Conveyor Equipment Morris Material Handling SA (Pty) Ltd

Osborn Engineered Products (Pty)Ltd PD Engineering Services cc PH Projects Holdings (Pty) Ltd Rio Carb (Pty) Ltd Sandvik Materials Handling Africa Screw Conveyors & Material Handling Senet SEW Eurodrive Spar Western Cape SSAB South Africa (Pty) Ltd Tenova Zest Electric Motors (Pty) Ltd

36 (011) BULK HANDLING Tel: 867-0902INAFRICA Fax: 2018 (011) 867-0036  Email: saimh@global.co.za  www.saimh.co.za

HOLISTIC STRATEGY

Second Scramble for Africa For the second time in history, the African continent has become a focal point for global expansion. As a result, valuable goods, services and intellectual property are being exported into Africa. With this expansion comes the reality of increased demand, and competition and the risk of imitation. It is therefore crucial that intellectual property rights are adequately protected before embarking on any expansion strategy.

A

ny intellectual property expansion strategy must be structured to optimally protect intellectual property rights and brand value.

Some of the factors to be taken into account are:

• Trade mark, design and patent registrations.

These rights are territorial and must therefore be separately applied for in each jurisdiction in which an organisation trades or plans to trade in the future. It is important to note that many African territories do not protect common law rights, which essentially means that without the registration of trade marks in these territories, brands cannot be protected from infringement by third parties.

There are two regional intellectual property offices operating in Africa, being the African Regional Intellectual Property Organisation (ARIPO) and the African Intellectual Property Organisation

(OAPI). An ARIPO registration facilitates the central filing of trade marks, designs or patents in any or all of the designated member states. Although a single application is filed to cover more than one designated member state, the registration which results is essentially a national registration in each designated member state. An OAPI trade mark, design or patent registration extends automatically to all 17 member states.

Design or patent registration extends automatically to all 17 member states The protection of trade marks in strategic territories and territories which form part of retail distribution routes is also a useful mechanism in the fight against counterfeiting, which is an ever present reality when trading on the African continent.

• Licencing or distribution arrangements.

There are numerous ways in which to distribute products or services throughout Africa. An important element which is often overlooked is the manner in which intellectual property ownership, use and enforcement is governed between the relevant parties. It is therefore prudent to secure licencing and/ or distribution arrangements prior to conducting a full scale roll-out of an African expansion strategy.

Webber Wentzel, Carla Collett, www.webberwentzel.com

Carla Collett, Senior Associate at Webber Wentzel

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Outsource Fleets for Economic Survival The outsourced fleet management industry is not only saving costs for fleets across the country, but mitigating risk amid a challenging operating environment as well.

This is according to Mkhuseli Setuse, Executive of Bidvest Bank’s Fleet Finance and Management Division.

One bank customer saved close to R20 million over a five-year period, simply by opting to outsource their fleet management programme, he adds.

“Most businesses that require large fleets are not specialists in running fleets. Outsourcing to fleet management specialists translates to a reduction in all fleet-related costs, including staff management. As customers demand more transparency when it comes to

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BULK HANDLING IN AFRICA 2018

WCA Expands Global Presence International logistics company, WCA, recently opened additional membership service centres to further enhance its network relations.

The company’s offices in Dubai, New Delhi and the Ivory Coast are now operational. A facility in Shenzhen is also set to open soon. The new service centres join already-established regional WCA facilities in Bangkok, Miami, Mumbai, Shanghai, Istanbul, London, and Amsterdam.

fleet and driver-related costs, outsourcing a business’ fleet management function can drive various cost-saving and risk-mitigation initiatives,” Mkhuseli concludes.

Bidvest Bank Fleet Finance and Management Email: fleetmanagement@bidvestbank.co.za www.bidvestbank.co.za

“These new offices help round out our global reach and allow us to best service the complex needs of our members, while promoting their global businesses in an increasingly competitive market,” comments David Yokeum, WCA’s Founder and Chairman.

WCA Kaitlyn Mode Email: Kmode@wcaworld.com www.wcaworld.com

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