The Africa Logistics magazine- Dec 2022

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Logistics Dec 2022 Keeping the world connected
Cover Photo: Simon Maage

Harmonised logistics could spur intra-Africa trade

regional trade across the globe is a complex interaction between people, companies and or ganisations. Supply chains traverse countries and regions.

Trade has become an everyday business, and its performance largely depends on connectivity by roads, rail and sea, telecommunications, finan cial markets and information processing.

Despite such knowledge of what facilitates trade, Africa’s regional trade potential remains under-exploited. The World Bank notes that trade between countries on the continent represents 12 percent of the total economic activity compared to 40 percent in Asia and 60 per cent in Europe.

To bridge this gap, African nations instituted the African Continental Free Trade Area (AfCFTA) agreement on January 1, 2021. This marked the dawn of a new era in intra-regional trade facilita tion.

The agreement aims to eliminate import tariffs on 97 percent of goods traded globally and ad dress non-tariff barriers. It opens up a market of more than 1.3 billion people and is expected to boost intra-African trade while encouraging direct investment in the continent from the rest of the world.

While the agreement focuses on facilitating trade and services and easing the regulatory mea sures and technical trade barriers, a lot needs to be done. For Africa to boost intra-regional trade from the 12% reported by the World Bank to the target of 20 pecent, it needs to make significant changes in technology, infrastructure, and policy reforms. For one, boosting intra-African trade re quires the continent to encourage more invest ment opportunities for product diversification. Currently, there exist narrow patterns of trade de pending on primary products involved in low levels of inter-country trade.

Since most African countries mainly export raw materials to import finished products, there is little that the African countries are interested in import ing from each other. There is a need for export di versification and product sophistication, which will

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allow for the inclusion of more small and mediumsized enterprises (SMEs), encouraging innovation as markets expand.

By improving the quality of exports for African countries, the continent will build resilience regard ing movements in demand resulting from economic downturns in importing countries and price dips. This will go a long way in shifting African econo mies to produce higher-value-added products and services and reduce the existing over-dependence in global trade.

UNCTAD says Africa’s untapped export potential stands at $21.9 billion, equivalent to 43 percent of intra-African exports. UNCTAD adds that an addi tional $9.2 billion export potential can be achieved if Africa implements partial tariff liberalization under the AfCFTA over the next 5 years. Currently, trade between African countries comprises 61% of pro cessed and semi-processed goods. This suggests significant potential benefits from greater regional trade ideal for transformative and inclusive eco nomic growth.

But perhaps infrastructure is the most effective solution that will make AfCFTA fly and open a world of opportunities in Africa. Harmonizing logistics in the continent is key to enhancing the efficiency of cross-border trade through seamless cargo move ment.

simplicity of moving goods and services across countries. It also analyzes cross-border clearance processes, among other challenges hampering trade.

Time, infrastructure, and entry barriers are the biggest challenges which Africa logistics harmoni zation can help mitigate. Today, for East Africa to trade with West Africa is a cumbersome process that can best be handled by either air, which comes at a high cost, or sea, which comes with long waits for delivery.


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4 The Africa Logistics inside ... Connecting the World Across Oceans COVER STORY NEWS & FEATURES 6. German shipping and logistics expert Harren Group enters Africa 7. Astral Aviation selects ACL Airshop as a Strategic Partner 8. Emirates and Gulf Air Launch Codeshare Partnership 9 China launches first-ever intermodal service to Africa 15. Creating a disruptionproof supply chain in Africa 13. ACCELERATING THE PACE TO AVIATION NET ZERO CARBON EMISSIONS 38 13 30 28 17 Amid food and climate crises, investing in sustainable food cold chains is crucial 5 10 26 40
China Containerized Freight Indices
and CCFI) have fallen
Container path to normsalisation 38
A brighter future for Africa’s commercial aviation industry
and 19% respectively since the beginning of the year but remain significantly above 2019 levels. Increase in
rail could support Africa’s sustainable future-Alstom study

German shipping and logistics expert Harren Group enters Africa

German shipping and logistics ex pert Harren Group extends its presence in Africa by opening its first office on the continent. Harren Nigeria in Lagos is led by Managing Director Paul Okpurughre.

“The new office represents the entire Harren Group and serves as a basis for further busi ness development in West Africa,” explains Paul Okpurughre, former Director Business Development and Operations (MEA) at SAL Heavy Lift. “We want to intensify the proximity to our customers and our business activities in the region.”

West Africa represents about 30 percent of Africa’s total population. Nigeria has the larg est economy in Africa, even ahead of South Africa. “Lagos is the perfect location for us –it’s a vibrant city and one of the main project and logistics capitals on the continent,” ex plains Dr. Martin Harren, CEO of the Harren Group. “The opening of the new office reflects our remarkably successful development in West Africa. We want to further expand our local position based on the existing, trustful relationships with our customers and part


Jürgen Kuntz, Senior Manager Chartering & Projects and Head of Africa Chartering Desk at SAL Heavy Lift, emphasises: “Having our own office in Africa means a lot to our organ isation. Currently, around three of our Group’s ships sail to this region on a monthly basis. So it’s the next logical step to open an office there to be able to further develop our posi tion. We see lots of opportunities for example in the energy and infrastructure segments.”

Nils Aden, Managing Director of the Harren Group, underlines the potential for the entire Group: “There are also new opportunities for business beyond our existing heavy lift activi ties – for example in the tanker, bulker and renewable energy sectors. The new office will represent our Group’s affiliated companies Jumbo-SAL-Alliance, Intermarine, Harren Bulkers, Harren Tankers, Atheleon and Combi Lift as their commercial agent. Opening the Lagos office makes our dedicated and per sonal services available to our customers lo cally. This is another important milestone for our Group.”

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Astral Aviation selects ACL Airshop as a Strategic Partner

Astral Aviation, headquartered in Nairobi with air cargo operations throughout Africa, Middle East, Asia, and Europe, has confirmed a multi-year ULD (Unit Load Device) agreement with ACL Airshop, a leading international ser vice partner for outsourced ULD manage ment and customized logistics solutions.

Astral Aviation and ACL Airshop are teamed together to enhance the logistics efficiencies of Astral Aviation’s ULD fleet, including the introduction of “ULD Control™” for real-time tracking of ULDs. That, combined with ACL’s global Operations Center and the innovative “FindMyULD” mobile App all operate together for better utilization rates and cost efficiencies for client airlines that use ACL’s digital suite.

Astral Aviation, in operation for the past 22 years based out of its Nairobi Hub, serves the African continent through efficient and in novative air logistics solutions. As part of its TIACA membership Astral Aviation has bene fited through world class innovative solutions via benchmarking with the best in class cargo logistic peers.

It is through these global affiliations that As tral Aviation is proud to be part of the initial cohort of launch members for the “Blue Sky Initiative.” In addition to Nairobi, Astral Avia tion operates to 50 destinations across Af rica, and utilizes other key Hubs such as Jo hannesburg, Liege, Dubai, and Hong Kong.

It has interline agreements with over 30 in terline partners; along with preferential agree ments with the leading global and local freight forwarders; and partnerships with over 25 global GSA’s. Astral operates a fleet of F50 (7 tons), DC9F (15 tons), B727-200F (22 tons), B757F (30 Tons), B767-200F (42 Tons) and B747-400F (110 Tons) within its Intra-African, Middle East, Asian and European network.

ACL Airshop is a leader in products and services for the global air cargo industry. Air shop has become a leading one-stop-shop for leasing, sales, repair, and fleet control of Unit Load Devices (“ULDs”), and cargo con trol devices manufacturing. The company op erates around the world on six continents with

service capabilities at over 50 of the world’s Top 100 cargo hubs.

One of the unique aspects of the compa ny’s offerings is short-term rentals and leasing solutions for airlines’ cargo products require ments—including one-way leasing drop-offs.

Coupled to its dominance of short-term custom leasing solutions, ACL Airshop has also added a growing portfolio of long-term multi-year ULD fleet management contracts with an array of air cargo customers. The pairing of short-term customized flexibility and long-term cost-efficiency has become a powerful combination on behalf of air cargo customers such as Astral Aviation.

Sanjeev Gadhia, Chief Executive Officer of Astral Aviation, said: “Astral Aviation values its strategic partnership with ACL Airshop. As we expand our air cargo network, we are enthused to extend their relationship with us through this multi-year agreement.”

Steve Townes, CEO of ACL Airshop said: “It is our privilege to serve Astral Aviation with our complete suite of equipment, technology, and logistics services. Astral’s unique strengths across Africa are admirably formidable, plus their expanding network of operations to oth er continents. With the industry’s largest inde pendent fleet of Lease-Ready ULDs and our own growing network of service hubs on 6 continents, our objective is to cost-effectively help Astral Aviation keep growing as a trusted leader in air cargo.” 7

Emirates and Gulf Air Launch Codeshare Partnership

Al Alawi in the presence of H.E. Mr. Zayed R. Alzayani, Gulf Air’s Chairman of the Board of Directors. The signing ceremony was also at tended by members of each airline’s execu tive management teams.

The expanded partnership will see Gulf Air place their marketing code “GF” on Emirates operated flights beyond Dubai to a selection of some of the most attractive global tourism hotspots, offering new holiday options for Gulf Air customers. Travellers will be able to con nect to points including Budapest, Prague, Warsaw, Algeria, Tunis, Bali, Hanoi, HoChi Minh City, Taipei and Sao Paulo.

The new codeshare agreement’s mix of unique points comes as travellers from the GCC have become more well-informed, val ue-driven and savvy, increasingly looking for new, diverse experiences and attractions be yond their traditional holiday destinations.

The new partnership will also offer custom ers the convenience of combined ticketing and check-in, a unified policy and seamless transfers for baggage, and competitive single fares on a multi-airline journey when connect ing on Emirates. Customers can book their travel on Gulf Air’s website, through Gulf Air point of sales and online travel agencies as well as with local travel agents.

Emirates and Gulf Air have today of ficially signed a unilateral codeshare partnership, starting this Decem ber*. The new agreement will offer easy connections and expanded choices for Gulf Air customers connecting to Dubai and onwards to a host of Emirates destinations across Europe, Africa, South America and the Far East.

The agreement was signed on the first day of the Bahrain Airshow, signalling a growing relationship between both airlines following on the framework of cooperation established last year. The agreement was signed by Sir Tim Clark, President Emirates Airline and Gulf Air’s Chief Executive Officer Captain Waleed

Sir Tim Clark, President Emirates Airline said: “We are pleased to partner with Gulf Air to offer their customers greater access and strong connection opportunities to unique destinations on our network, complement ed by Emirates’ signature in-flight service and hospitality throughout their journey from Dubai. We look forward to working together and achieving more with Gulf Air in the near future, and further strengthening our relation ship.”

Captain Waleed Al Alawi, Gulf Air Chief Ex ecutive Officer commented: “Our relationship with Emirates Airline has always been strong and today we are reaching a higher level of collaboration with many more opportunities in the horizon between the two carriers. This partnership will empower both of us to offer a more elevated experience to passengers and widen their travel options.”

Emirates currently has codeshare coop eration agreements in place with 26 airline partners and two rail companies around the world, expanding its network reach to over 300 cities.

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China launches first-ever intermodal service to Africa

wChina set in motion a new intermo dal service connecting the coun try with Africa via Europe. The rail part of the service will run between Chengdu, in southwest China, with Hamburg, in Germany, via the China-Europe Railway Express. From there, goods are shipped to Casablanca, in Morocco, by sea.

This is the first-ever service with this kind of connection. The inaugural train left Chengdu on Saturday, 15 October, and the total transit time should revolve around 35 days. The ser vice should benefit mainly the Chinese textile industry, especially in the west of the country. China and Morocco’s recent developments

This new service shows the strong relation ship between China and Morocco. The latter joined the BRI in 2017 and upgraded the term of the relationship at the beginning of 2022. This new agreement enabled China to pro vide Morocco with a vaccine against COV ID-19, the Sinopharm. In August, in addition, Morocco adhered to the One-China policy, which states that China, including Taiwan, is part of one Chinese nation and one Chi nese government. China exports to Morocco mostly textile materials, tea, and broadcasting

equipment. On the other hand, Morocco sends China various raw materials, in cluding copper, calcium phosphates, and zinc ore.

China’s investments in Africa China has been heavily investing in Af rica since the turn of the century with the launch of the Forum on China-Africa Co operation (FOAC), which was integrated into the Belt and Road Initiative (BRI) in 2018. The FOAC currently includes 53 out of 54 African countries, with the ex ception of the Kingdom of Eswatini, in the south of the continent.

Since 2000, members have been meeting every three years, alternating between China and Africa for the meet ing locations. China can provide aid in the forms of debt forgiveness, aid grants, concessional loans, and interest-free loans through the FOAC. For example, in 2021, China claimed it would forgive 23 interest-free loans that had matured at the end of that year for 17 African countries. During that year, moreover, China invested over 47 billion euros in Africa. 9

Increase in urban rail could support Africa’s sustainable future-Alstom study

Alstom, global leader in sustainable and green mobility solutions, re leased a new study today titled, “The Role of Urban Rail in Sustain able Africa” in collaboration with EY Climate Change and Sustainability Services.

As a contribution to the important discus sions taking place at the 27th Conference of the Parties (COP27), the study demonstrates how increased investments in urban rail trans

port in Africa can facilitate the avoidance of substantial carbon emissions and contribute to broader sustainability goals, delivering en vironmental, social and economic benefits for Africa’s growing cities.

Africa has a fast-growing population and the world’s highest urbanisation rate. The continent’s urban population will increase from 600 million in 2021 to over 1.3 billion in 2050. A key challenge is to ensure that this

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growth meets the UN’s Sustainable Develop ment Goal 11: Making cities inclusive, safe, resilient and sustainable. This new study shows that for this to happen African cities must advocate to develop more sustainable transport systems, both to reduce carbon emissions and to foster inclusive socio-eco nomic growth. “With COP27’s focus on imple mentation, Alstom commissioned this study with EY Climate Change and Sustainability


According to the International Energy Agen cy, passenger rail’s modal share has stagnat ed globally at around 6-7% for a decade and must grow by more than 40% in the next de cade for transport to remain on track to meet net zero. This study, therefore, highlights the benefits that can be realised if the modal share of urban rail in African cities increases to 10% in 2030 and 20% in 2050 (compared to the baseline scenario of 1% today). A cumulative total of 1,005 million tonnes (Mt) of CO2 (1 gigatonne [GT] of CO2) could be avoided be tween 2023 and 2050 in this scenario, com pared to the status quo. This is equal to 32% of Africa’s total GHG emissions in 2019. One hundred and seventy-three million additional tonnes of CO2 would be avoided between 2023 and 2050 if urban rail systems were fully powered with renewable energy. Invest ing further in urban rail would bring propor tional social and economic benefits leading to safer, healthier, and more inclusive cities. By increasing the modal share of rail to 20% by 2050, 29 million cars would be removed from Africa’s roads each day, leading to a signifi cant decrease in congestion, road accidents and air pollution. Urban rail is more afford able and more accessible than cars and un official transport systems, giving passengers easier access to jobs and key services such as education and health. This shift from road to rail could also support job creation related to construction and operations and mainte nance in Africa estimated at about 258 jobs per kilometre of new rail built. For example, a 60-kilometre urban project would create over 15,000 direct jobs.

Services to highlight the many benefits that increased investment in urban public trans port can bring to Africa’s cities and support their sustainable growth. It is indeed demon strated that every increase in a modal shift to rail transport will bring better access to socioeconomic opportunities, reduced congestion, increased safety, and improved air quality on top of decarbonisation,” stated Cécile Texier, Vice President CSR and Sustainability, Alstom

The study also highlights the benefits brought by Cairo’s long-term commitment to public transport. “With COP27 in Egypt, it is an opportunity to highlight that Egypt was the first country in Africa to open a metro line in 1987 and have 3 operational metro lines, 2 additional metro lines planned and 2 mono rail lines under construction. The additional metro and monorail lines alone, will allow the city to avoid a cumulative 35 Mt of CO2 emis sions between 2023 and 2050, equal to 10% of Egypt’s total GHG emissions in 2019. Ad ditionally, it provides the city with other so cial and economic advantages such as the reduction of 595,000 cars every day and a sharp reduction in congestion, estimated to cost Egypt USD 8 billion each year, savings that could be reinvested in green and digital mobility solutions,” concluded Andrew De Leone, President Alstom Africa, Middle East, and Central Asia. 11

Ever wondered why it is expensive to fly within than without Africa? Well, turns out that taxes play a pivotal role in making cost of flight to and within Africa to be out of reach for many travelers.

According to African Airlines Association (AFRAA),there is no common policy in terms of Air navigation service charges in Africa. And as such service providers apply different rates from a country to another, except for ASECNA whose formulas are common for 17 member states in western and central Africa, and in Indian Ocean.

The aviation industry has a particular fiscal regime. According to ICAO regulations, fuel, which represents at least 24.7% (IATA WATS 2019) of African airlines’ operational costs, should not be taxable. However, many other specific taxes and fees are applied to passen gers.

For non-regional travels, passengers pay in average 3.4 different taxes and fees at depar ture, representing an average amount of USD 64. Out of 53 airports, 10 charge passenger above USD 100.

Western and central Africa are the most ex pensive regions in terms of passenger charg es with an average of USD 94.59 and USD 93.74 respectively for international travels. The region where passengers pay the lowest amount of taxes and fees is Northern Africa, with an average of USD 26.27.

In Central and Western Africa, 10 out of 23 airports, which is almost half, charge more than USD 100.

Thus, the two regions represent only 20% of the global traffic to/from Africa. Most of Northern African airports which represent 35% of the traffic, charge less than 50 USD.

While the average amount of passenger paid taxes and fees in Africa is USD 64, pas sengers are charged USD 30.23 in Europe and USD 29.65 in Middle East despite the fact that traffic is much more significant in these regions.

Passengers in Africa also pay taxes and fees for transfer and on arrival. Airports in Eu rope charge less than Africa in terms of taxes and fees on arrival and transfer. The average amount of transfer taxes and fees in Africa is USD 36.02 compared to USD 17.55 in Eu rope. Taxes and fees on arrival are USD 8.81 in Europe, while USD 12.32 in Africa.

Apart from Passengers taxes that are lev ied directly on the ticket, airlines have to face many other charges related to their operations at the airport level such as Landing, Noise, Parking, Common User Terminal equipment CUTE, Jetway Charge, passenger Bus etc.

Mogadishu is the most expensive airport for

airlines charges, with more than USD 2000 for an international flight, while a busy airport like Algiers charge USD 158 in the same conditions. The average amount of charges paid is USD 624, but 53% of the airports are charging less than USD 600. 3 airports in Africa charge below USD 50: Maseru, Khartoum and Manzini.

While airlines attempt to offer low fares to passengers, taxes and fees can bring the to tal price of a ticket to more than double of the base fare. Given the low purchasing power in Africa, it is urgent to assess the issue of high taxes and fees, to stimulate the demand and make air transport affordable to African citi zens.

The high level of taxes, fees and charges,


Why flying within Africa is expensive

according to AFRAA is a critical issue and it is counter-productive for air transport devel opment in Africa. As air transport is consid ered as a luxury service, government tend to overtax air transport supply chain leading to excessive service charges to the airlines.

“The average amount of passenger’s paid taxes and fees applied to air tickets is twice more expensive in Africa than in Europe or Middle East. AFRAA advocate for reducing taxes, fees and charges through effective gains along the entire supply chain to ensure affordable air transport prices and increase traffic growth rates.”

According to a study from Predictive Mo bility, the elasticity price/demand for air trans port within

Africa vary from -2.34% to -3.15%. That means that a reduction of 10% on the ticket price can increase the demand at continen tal level, from 22.3 to 30.1 million passengers yearly.

“Thus, the reduction of taxes and charges can allow a significant stimulation of demand on the continent. This will help our airline to become more competitive, especially against foreign operators, who are based in regions were the taxation is lower comparatively. A wealthy air transport industry is necessary for the development of tourism, trade, and of key economic sectors in Africa,” AFRAA con cludes. 13

The impact of the pandemic on global supply chains has prompted gov ernments around the world to look at ways to fix the broken links. In Africa, the launch of African Continental Free Trade Area (AfCFTA), has provided the conti nent with new opportunities to strengthen its regional supply chain.

Virusha Subban, Head of Indirect Tax at Baker McKenzie in South Africa, explains that there were massive breakages in key links in global supply chains during and after the pan demic, with issues including, among many other things, route congestion and block ages, manufacturing shutdowns, a deficit of skilled labor, a global shortage of key logistics components including shipping containers, a lack of space in warehouses, a spike in trans portation costs and substantially increased demand for goods around the world, postlockdown. As a result, countries have been looking at ways to relink broken chains.

In February 2021, President Biden ad dressed this issue by signing an Executive Or der on America’s supply chains. He ordered federal agencies to review and identify vulner abilities in key US supply chains and develop policies to ensure those supply chains would be more resilient to future shocks.

Similarly, the European Union Policy De partment for External Relations issued a re port on Post Covid-19 value chains: options for reshoring production back to Europe in a globalised economy. The report noted that, against the background of both supply short ages due to the pandemic, and the shift in

global trading patterns, reshoring of produc tion, the process of bringing production ac tivities home, had become a topical issue in recent EU policy debates.

Last year, the African Union African Peer Review Mechanism 2020 published a report on Africa’s governance response to COV ID-19, which highlighted Africa’s supply chain challenges and overreliance on foreign trade and suggested that the continent boost its manufacturing capacity to build a strong Afri can supply chain that could not be weakened by global blockages.Marc Yudaken, Partner and Head of the IMT Sector Group at Baker McKenzie in Johannesburg, notes that sup ply chains in Africa were already under pres sure before the pandemic, due to inadequate infrastructure, corruption and security issues, poor trade logistics, overreliance on foreign imports, onerous regulatory requirements and complex customs procedures.

He explains that a recent Baker McKenzie report – A License to be Bold: Transforming Industrials outlined areas of post-pandemic focus for supply chains in the IMT sector, which included being able to adapt to new markets, embrace digitalization and enable the disruption-proofing of supply chains. The report noted that disruption arising from CO VID-19 accelerated trends already apparent in the industrials market, particularly digitali zation and trade volatility, and transformation has now gone from a “nice to have” to a ne cessity.

Yudaken notes that due to the global sup ply chain disruption, many African countries

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a disruption-proof supply
chain in Africa

have begun looking at ways to improve their manufacturing capacity so that they can pro duce local components that don’t need to be imported and that can be traded within the continent.

“Reliable transport and utilities infrastruc ture is vital in terms of ability of the IMT sec tor to scale up production for regional export and to develop its manufacturing bases. To improve transport infrastructure in Africa, large projects have been announced or are in progress, including, for example, the TransMaghreb Highway in North Africa and the North-South Multimodal Corridor, connecting extensive parts of Southern Africa, as well as the Central Corridor project and the AbidjanLagos Corridor Highway project. Further, Af rica needs an adequate supply of water and electricity to increase production capacity and incentivize foreign companies to set up facilities on the continent – energy and utilities infrastructure is direly needed across African jurisdictions. Domestic policy changes that address these issues are therefore playing a crucial role in disruption-proofing Africa’s sup ply chains at present.”

Subban agrees that improving manufactur ing capacity is a key way to remove reliance on global supply chains. A Baker McKenzie report, with Oxford Economics, AfCFTA’s USD 3 trillion Opportunity (AfCFTA report) looked at African imports from outside the continent and revealed that manufactured products industrial machinery and transport equipment constituted over 50% of Africa’s combined needs.

Currently, Africa’s external imports account for more than half of the total volume of im ports, with the most important suppliers be ing Europe (35%), China (16%) and the rest of Asia including India (14%). By contrast, im ports from other parts of Africa account for only 16% of total merchandise imports.

Manufacturing GDP represents on average only 10% of GDP in Africa. This means that limited production capabilities within Africa are currently being compensated for through foreign imports. This manufacturing deficit could be eventually satisfied within the conti nent and enabled by AfCFTA.

“Further, in terms of rapid global digitiza tion, a sophisticated legal and regulatory framework that enables digital transactions is vital for full participation in global digital trade, which is expected to play a leading role in a post-pandemic trade environment.

“The trade in services, for example, is an especially pertinent area of focus for all coun tries in Africa and could represent a way to overcome the current production and sup ply chain limitations that threaten to hold up the Africa-wide trade in goods. Because a service can either be traded directly or serve as an input into the production process of a product, the liberalization of trade in services is not as hindered by current infrastructural or logistic deficits as the trade in goods. In this way, Africa’s service trade sector can benefit from bypassing the industrialization phase,” she says.

The AfCFTA report shows that the trade in services in general currently accounts for over half of gross value added in Africa. In order to fully realize its benefits, however, there needs to be a better understanding among policy makers of the important role that services can play in regional value chains. This will allow the continent to address the structural con straints on growth in these sectors. The re port notes that easing restrictions on foreign government policy throughout the continent will increase the flow of service trade between countries. For example, allowing more ac cess to the information and telecommunica tions systems would encourage companies to enter new markets. Further, lowering the cost of access and usage of communication and fortifying network security will encourage businesses to set up or ramp up operations in the continent

“Addressing infrastructure shortfalls, boost ing manufacturing capacity, and leveraging the benefits of digitization will add strong links to Africa’s regional supply chain, ensuring it can withstand breakages and disruption,” adds Subban. 15

Keeping world

The Africa Logistics COVER STORY

Keeping the world connected

Aviation is resilient and on the rise. After the worst downturn in our his tory, we have turned the corner on the COVID-19 pandemic. Industry losses are expected to reduce to $9.7 billion in 2022; down from $42.1 billion in 2021.

That is a huge improvement from losses of $137.7 billion in 2020. In growing numbers and with rising excitement and enthusiasm, people are again enjoying the freedom to trav el, to connect with one another, and to see the world. By the end of 2023, most regions will be at—or exceeding— pre-pandemic lev els of demand.

Pandemic lessons

looking back at the pandemic, we can point to our service with pride. Where permit ted by governments, airlines kept the world connected. Airlines kept vital supply lanes open to deliver lifesaving vaccines and medi cal supplies.

And they operated to the highest levels of safety throughout. Over and over, the aviation workforce rose to the occasion. In fact, the importance of aviation was made absolutely clear by the pandemic restrictions. People recognized that their quality of life deteriorat ed and economies suffered. This pandemic will not be the last.

It is vital, therefore, that we draw the correct lessons so that we can be better prepared next time. Top of the list of lessons learned is that travel restrictions did little to contain the spread of COVID-19. The World Health Orga nization (WHO) said this from the beginning, but far too many governments ignored their sound advice. Governments must do better next time.

Working with governments

Many governments recognized aviation’s vital role as an economic lynchpin, providing financial relief to numerous airlines.

As governments now rebuild their regula tory agendas, it is critical that they continue to focus on regulations that create value. IATA will be vigilant and remind governments that the benefits of regulation must exceed the costs they create. Slot regulation is a case in point. The Worldwide Airport Slot Guidelines are fundamental to delivering reliable sched ules with insufficient airport capacity. When government-imposed travel restrictions stopped airlines operating, flexibility on slot rules preserved networks and connectivity.

Now, as routes are being re-opened and demand returns, we still require flexibility in slot rules, particularly as airports race to hire back staff to meet surging demand. There 17
The Africa Logistics COVER STORY
“By the end of 2023, most regions will be at—or exceeding— pre-pandemic levels of demand.”

is absolutely no reason to treat the return to normal as an opportunity to rewrite the slot rules that performed admirably before the lockdown. Likewise, we see the temptation to introduce new consumer regulations, on everything from airline service offerings to ac cessible travel.

We are committed to making travel acces sible, but the focus of any new rules needs to be on addressing the operational issues in this area, rather than imposing penalties.

Regulators must not tolerate infrastructure providers seeking to recover pandemic loss es by using their natural monopoly powers to price-gouge their customers. With some air ports already in the process of implementing doubledigit increases, governments must un derstand that the light touch regulations pro posed by many airports come with a heavy price to pay for consumers, the economy, and airlines.


At our 77th AGM, our members resolved to achieve net zero carbon emissions by 2050. That was quickly followed by similar com mitments across the industry. The missing component is a similarly ambitious long-term target by governments, which should be ar ticulated at this year’s Assembly of the Inter national Civil Aviation Organization (ICAO). The Assembly will also be an opportunity for governments to shore-up their support for CORSIA (Carbon Offsetting and Reduction Scheme for International Aviation) with a sen sible baseline agreement that fairly recogniz es the adjusted baseline of 2019. Individual governments must not undermine CORSIA’s effectiveness with competing, duplicative, or politically divisive extra-territorial initiatives.

To achieve net zero by 2050, airlines must rely on infrastructure, supplier partners, and the offset providers to do their part with cred ible initiatives that deliver real reductions. The game changer, however, is sustainable avia tion fuel (SAF), which is expected to account for about 65% of our carbon mitigation efforts by 2050. Airlines bought every drop of SAF that was available in 2021 and made forward purchase agreements worth some $17 billion.

As with the wind and solar energy transi tions, the tipping point will be facilitated by government incentives, not taxes.


The last challenge to highlight is improving gender diversity. We have made progress, but aviation continues to be male dominated. By not having better gender balance, we are short-changing our industry on talent, and in

the long term this is not sustainable.

There is no way to successfully address la bor shortages if we do not take full advantage of the female half of the population. Change is happening but we must make it happen fast er through the examples of the IATA Diversity and Inclusion Awards and the commitments of the 25by2025 initiative.


In the 14 months since taking on the re sponsibilities of Director General, I have gained a deep appreciation of the excellent work being done by the IATA team in serving the needs of our members. Examples of their efforts are present throughout this document. This includes our financial settlement systems that have remained reliable even under ex treme stress. I am determined to make IATA even more effective in the coming year and I know my IATA colleagues share this commit ment. 19 COVER STORY


Aviation Consulting Simplified

The idea for AviAnalysis was born in January 2021, in the middle of the Covid-19 global pandemic, when personal contact and travel to other countries were extremely limited. The need to continue to support airlines, airports, and civil aviation authorities with accurate and timely aviation consulting insights was greater than ever: airlines were losing money by the day, with aircraft immobilized and staff waiting out the pandemic at home.

The aviation industry was also prepared for digitization and change, many studies now show how this industry, severely impacted by the global crisis, lags others in digital trans formation; only digitalization will take it to a post-pandemic ‘new normal’.

And so began the work of developing a platform that takes aviation consulting to a new level. For digitization to be effective, it must permeate every aspect of the aviation industry, including the customer experience through the B2B industry supply chain. With the introduction of its AviAnalysis platform, AviaPro Consulting removed the obstacles to obtaining aviation consulting insights, by making available, in a timely fashion, results from aircraft route and forecasted passenger demand analyses to aviation professionals worldwide.

As the first online platform in the world for accessing aviation consulting in a costeffective manner, AviAnalysis is on a mis sion to make accessing aviation consulting an easier and faster proposition than it has ever been, while at the same time delivering the most timely and useful analysis results in the industry. With its inaugural offering of Air craft Performance Analysis, Aircraft Operating Economic Analysis and Passenger Demand Analysis, the brand’s innovative and simpli

fied approach was recently commended by Nicolas Sarlenga, former Head of Route De velopment at Aeropuertos Argentina. “The overall buying experience is quick, good and reliable”.

The ability to use the platform by key de cision makers and professionals at airlines, airports, lessors, and civil aviation authorities has been hailed as a refreshing alternative to the cumbersome and expensive consultant hiring process that is current in the industry. The system offers the ability to select from a common set of operating assumptions and provide customized inputs for a tailored anal ysis with made-to-order results.

The Aircraft Performance Analysis provides aircraft takeoff, landing and enroute perfor mance results for a selection of airliners from

Easy to use, affordable aviation analysis” says Kevin Clarke, Head of Aviation Consulting at AviaPro Consulting, in attendance at the AFRAA AGA in Dakar, Senegal.
Mr. Kevin Clarke

all leading aircraft manufacturers, on specific routes identified by their origin, destination, and diversion airport IATA codes. This analysis is ideal for assess ing route mission requirements, such as payload capability, block times and block fuels.

The Aircraft Operating Economic Analysis provides aircraft direct operat ing cost results for a selection of airlin ers from all leading aircraft manufactur ers. It is ideal for assessing an aircraft’s fixed and cash operating costs per trip on any given route, based on the aircraft mission performance, location specific airport and air navigation charge rates, aircraft specific direct maintenance cost rates and various user provided cost as sumptions.

The Passenger Demand Analysis pro vides forecasted demand on new flights for a list of study markets and is ideal for

assessing an operator’s potential traffic based on new capacity offered, a sched ule of the specific departure and arrival times, airline partner assumptions and service index parameters following the introduction of the new service.

“AviAnalysis is a game changer for bringing useful aviation analysis to the consumer” comments Jorge Abando, Head of Industry Services at AviaPro Consulting. “We wanted to simplify and speed up the way consumers access aviation consulting to help them improve their ability to make decisions in running their aviation business”. For more infor mation on AviAnalysis, visit the AviaPro Consulting website at: 21

Strengthening Competitiveness

Africa’s Agricultural Chain Using Smart

Strengthening Competitiveness in Agricultural Value Smart Technologies

The COVID-19 pandemic has impacted global value chains (GVCs) by interrupting transportation and logistics frameworks, sup ply and production mechanisms, and demand and consumption patterns. On the pandemic onset, movement and trade restrictions were imposed by most African countries to control the spread of the COVID-19 pandemic.

The agricultural extension and advisory ser vices also confronted substantial disruptions due to limited movement. Consequently, this created a food supply crisis that deterred and threatened Africa’s socio-economic devel opment and growth, as well as food secu rity. These disruptions also highlighted gaps and weaknesses in Africa’s agricultural value chain.

The negative impacts of the COVID-19 pan demic in African agricultural value chains and food supply systems have been significant because many African countries are substan tially reliant on food importation. Reports have shown that African countries are substantially dependent on importing agricultural necessi ties outside the continent.

These imports include agricultural prod ucts such as seeds, fertilisers, veterinary in puts, fish fingerlings, and feeds. Therefore, the collapse of the international markets for agricultural inputs and outputs has exposed the weak agriculture value chains in Africa in terms of food supply and demand. This has resulted in dwindling of farming yields and food production across the African continent.

Consequently, this has led to the loss of jobs as job creation efforts have significantly declined within the agricultural sector due to the disrupted exportation and importation trade activities. These have also effectively reduced trade flows and increased trade defi cits for many African countries. For example, reports have estimated that the export supply disruptions cost African countries risk losses ranging between US $1 billion and US $5 bil lion in 2020, which has negatively impacted approximately 10 million farmers in the form of job losses. The pre-COVID-19 pandemic food shortage expectations in West Africa were envisaged to impact approximately 22 million people negatively. However, the CO VID-19 pandemic amplified the food shortag es and need for food assistance to approxi mately 28 million people. This demonstrates the challenges of food insecurity in Africa, among other things, caused by inefficient val ue chains.

Notably, agriculture has remained funda mental to Africa’s sustainable socio-econom ic growth and strategies towards poverty alleviation as outlined in the African Union’s 23

Agenda 2063 and the African Union Summit Decision on Accelerated Agricultural Growth and Transformation.

The United Nation’s Sustainable Develop ment Goal Number 2 (SDG 2) aspires to elimi nate hunger, poverty, and food insecurity by 2030 through smart agricultural frameworks. These aspirations from these frameworks can be accomplished through robust agricultural value chain systems across the African con tinent.

The systems can establish and create op portunities for small-scale subsistence and large-scale farming, as well as export com mercial farming. By accomplishing and sus taining these value chain systems, African countries can further enhance their agricul tural and economic development and growth. Therefore, innovative solutions to address these challenges currently facing African farmers need to be established and urgently implemented.

The African Union High-Level Panel on Emerging Technologies (APET) believes that the COVID-19 pandemic has presented unique opportunities for African countries to develop and strengthen inclusive agro-val ue chains across the continent using smart technologies. These smart technologies are essential in bridging and addressing the gap highlighted by the COVID-19 pandemic lock downs. This can be accomplished by using smart technologies to enhance the African agriculture value chain systems.

APET encourages African governments and the business sector to formulate publicprivate sector partnerships to strengthen and develop resilient agri-business infrastructure through smart technologies. By digitising the various agro-value chain activities, African countries can ensure more effective interac tions between farmers, input suppliers, trans port and logistics service providers, finan ciers, and other value chain, partners. The panel further encourages African countries to prioritise the adoption of smart technologies to effectively implement initiatives like the Af rican Continental Free Trade Area (AfCFTA), potentially enhancing Africa’s agricultural trade. Such efforts can substantially improve Africa’s trade revenues, food security, and ex pand job creation and employment opportu nities within the agricultural sector across the African continent.

African countries need to utilise smart tech nologies to mitigate the challenges that have caused Africa’s agricultural economy to re main fragmented, inefficient, and informal. This can help African smallholder farmers ac quire market accessibility and enable sustain

able operational costs.

Kenyan farmers leverage digital technolo gies such as Twiga Foods to augment agri cultural e-commerce businesses. The Twiga Foods e-business technology is helping Ke nyan farmers access food and grocery outlets within the country’s informal retail business sector. It is enabled by mobile technologies to aggregate the supply and demand fragmen tation within the agricultural value chain.

Consequently, this technology enables effi cient supply chain systems in Kenya, thereby reducing the food supply cost for African con sumers. APET encourages African countries to pursue technology-enabled platforms such as Twiga foods to enhance market access for African farmers and food processors. This can potentially augment sustainable and reli able supply within Africa’s informal and formal retailers.

Operationally, the Twiga Foods application consolidates vendors for farmers’ produce and crops by utilising geographic information system (GIS) technology. The GIS mapping leverages artificial intelligence (AI) enabled distribution platforms to consolidate consum ers that are seeking orders as well as the lo cation of potential and active customers. This application also advises on the conditions of the roads to determine and maximise efficient deliveries.

It also enables efficient payment platforms through digital mobile money applications such as the M-PESA. Consequently, the adoption of this technology has improved the market access efficiencies for Kenyan farm ers. Twiga Foods smart technology platform has decreased the typical post-harvest loss es for Kenyan farmers from approximately 30% per annum down to approximately 4% per annum.

Nigerian and Kenyan farmers have created the Hello Tractor application to connect trac tor owners to farmers through the Internet of Things (IoT) enabled digital technology solu tions. The Hello Tractor digital application bridges the gap between manual and mech anised farming by enabling farmers to place orders for tractors quickly and efficiently.

After the installation of the Hello Tractor ap plication into a smartphone, the digital appli cation connects farmers to their nearest avail able tractor with the appropriate equipment for the job that the farmer requires. Conse quently, this Hello Tractor application has improved the agricultural businesses for the tractor owners. This has been accomplished because farmers are experiencing easier ac cessibility to machinery to improve their farm ing production capacity and efficiency vastly.

24 The Africa Logiistics

The Hello Tractor platform has enabled business accessibility to approximately 3,000 tractor owners in these countries. Most im portantly, the platform has enabled tractor owners to determine their tractors’ fuel usage and maintenance.

Some African farmers find it difficult to ac cess financial services and farm input loans. Therefore, the deployment of smart technolo gies such as digital financial services (DFS) has potentially enabled financial services for farmers during the pandemic. For example, Safaricom financial services has developed an agricultural platform called Digifarms. Through the Digifarms application, farmers can access various agricultural and financial services via their smartphones. Additionally, the Digifarms platform offers farmers digital vouchers that can be used to purchase farm ing inputs at discounted prices.

The digital application is also enabling ac cess to the extension and administrative ser vices. Subsequently, the farmers are trained to utilise these extension and administrative services through various modules to acquire practical guidance and support. Farmers can utilise Digifarms’ loan module to apply for small loans to purchase farming inputs such as fertiliser, livestock, and feed. Robotics tech nology can potentially improve farming activi ties throughout the food supply chain. For ex ample, vegetable growers, fruit packers, egg producers and processors have observed enhanced efficiencies and financial benefits enabled by automation. This is accomplished while maintaining high food quality standards

at reasonable prices for consumers.

For example, the Royal Association of Brit ish Dairy Farmers has estimated that 5% of dairy farming in the United Kingdom has ad opted robotic milking parlours. Worth noting, these automated milking parlours constitute approximately one-third of all new milking systems being purchased by farmers. In ad dition, farmers around the world are also ex ploring robotic feed pushers and feeders to decrease labour costs so they can dedicate efforts towards cow welfare and performance.

Therefore, African countries should consid er these options to improve their production capacities.

Automation generates ample production with minimal effort. In turn, this creates more time and opportunities for farmers to focus on customer satisfaction across the supply chain. This is accomplished by creating mar ginal improvements of their products and ad vice that can significantly benefit agricultural businesses.

APET advises that the adoption of robot ics can substantially expand the supply chain and deploy smart technology into productive farming activities. For example, automated weeding machines can straddle rows of crops and mechanically remove any weeds within those fields. Furthermore, smart technologies enable accurate and efficient stock manage ment systems in beef, sheep, dairy, pig, and poultry farming activities.

African farmers can also adapt automated body condition scoring infrared camera sys tems for their cattle. 25

CONTAINER MARKET path to normalisation

The Shanghai and China Container ized Freight Indices (SCFI and CCFI) have fallen by 50% and 19% re spectively since the beginning of the year but remain significantly above 2019 lev els due to the significant increases recorded between mid-2020 and early 2022.

– Time charter rates and second-hand pric es have also reduced but remain high; fiveyear-old ships are on average 34.7% more expensive than new buildings.

– The IMF has lowered its global economic growth forecast to 3.2% for 2022 and 2.9% for 2023, and highlights that the risk of a global recession has increased.

– We forecast that head-haul and regional volumes will fall by 1-2% in 2022 and grow by 3-4% in 2023 but many risks exist.

– The fleet is expected to grow by 2.9% in 2022 and by 8.0% in 2023.

– Vessel demand is expected to increase by 10% due to EEXI and lower sailing speeds, while we believe that 7-8% of the fleet will be released from congestion by spring 2023 at the latest.

– Overall, the fleet supply/demand balance will worsen and lead to lower time charter rates and second-hand prices. We equally expect further reductions in freight rates, but they will remain significantly higher than in 2019.

Recent developments

The Shanghai Containerized Freight Index (SCFI), which represents spot rates for con tainers loading in Shanghai, enjoyed a period of almost uninterrupted growth between late May 2020 and mid-January 2022. At the end of the run, the index had increased by 491%. It has since dropped by 50% but remains at what would have been unprecedented levels prior to COVID 19. The China Containerized Freight Index (CCFI), which reflects the aver age rates of all containers loaded in China, increased by 326% during the same period and equally remains at unprecedented levels despite recording a subsequent 19% loss. While container rates have disappointeWd in 2022, they certainly are not disappointing.

Container volumes in head-haul and re gional trades during the first half of 2022 fell by 0.2% y/y but remained 8.0% ahead of the pre-COVID volumes recorded in 2019. This slight drop in volumes compared to 2021 cannot explain the large-scale corrections seen. We must instead turn to the supply side for an explanation. On one hand, the fleet has continued to grow, while on the other hand, congestion has played less of a role so far in 2022, though it remains an issue, and capac

ity supply has increased while demand has slowed slightly. Time charter rates and pric es for second-hand ships have followed the same trend as the SCFI and CCFI. Average time charter rates for a 6-12 month period have fallen by 6.0% since peaking in early April. Prices for five-year-old ships have on average reduced by 5.3% since April, but on average remain 34.7% more expensive than newbuildings. This indicates that there is still a willingness in the market to pay a significant premium to secure ships now, though it must be said that sales and purchase activity have fallen.

Overall, the container market remains very strong despite small setbacks to rates, pric es, and volumes. However, headwinds in the global economy, with very high inflation, in creasing interest rates, and lower growth can still be felt. Head-haul and regional volumes to Europe and the Australasia & Oceania region fell by 7.3% y/y and 12.5% y/y respectively in Q2 2022, while volumes into North America grew by 1.0% y/y only.

Demand drivers

The International Monetary Fund (IMF) has again lowered its forecast for the global econ omy. Central banks have raised interest rates and tightened their monetary policies in an at tempt to contain further increases in inflation, while the IMF estimates that global GDP in Q2 2022 was lower than in Q1 2022.

The baseline growth forecast from July estimates global economic growth of 3.2% in 2022, down from 6.1% in 2021, and that growth will stand at 2.9% in 2023. Further downside risks exist, and the IMF’s worstcase scenario forecasts a possible further re duction in global GDP to 2.6% and 2.0% in 2022 and 2023 respectively.

The EU and the US are expected to see slower growth than initially expected. The growth projection for the EU now stands at 2.8% and 1.6% for 2022 and 2023 respec tively, whereas growth in the US economy is estimated at 2.3% in 2022 and 1.0% in 2023, down from 5.7% in 2021. However, in other key demand areas such as Latin America & Caribbean, Sub-Saharan Africa, and Middle East & Central Asia, prospects for economic growth over the 2022-2023 period remain unchanged since the IMF’s April forecast.

India is still forecast to be the fastest-grow ing major economy despite reduced growth forecasts of 7.4% and 6.1% for 2022 and 2023 respectively. In China, slow domestic demand following large-scale COVID lock downs as well as global headwinds can be felt, and growth is projected to be the slowest 27

since 1990 at 3.3% and 4.6% for 2022 and 2023 respectively. As mentioned, the effects of global economic headwinds are also be coming clearer in the container market.

The customary Q3 peak season in the allimportant head-haul and regional trades looks to be almost non-existent in 2022, and it ap pears that demand is being affected by sev eral factors. Several reports detail how many low-income families worldwide are struggling to pay their rent and electricity and heating bills.

In addition, many appear to be taking on more debt to cope with rising prices, with credit card debt in the US growing at its fast est rate in 20 years during the last 12 months. Spending on services continues to account for an increased share of total spending. Fi nally, it appears that an inventory correction may be taking place among some retailers, with Walmart and Target in the US reporting that they are overstocked compared to cur rent sales.

All in all, our calculations indicate that head-haul and regional trade volumes could fall by between 1-2% in 2022 and then grow by 3-4% in 2023. A 12% year-to-date fall in the value of the EUR/USD exchange rate is a concern for buying power in Europe, while lower economic growth than that forecast by

the IMF is equally a significant risk.


Even though contracting has slowed down from an average of 358,000 TEU/month in 2021 to 248,000/month in the first seven months of 2022, the order book has still in creased by 1.2 million TEU since the begin ning of the year and now stands at 7.0 million TEU, equivalent to 27.6% of the trading fleet. The resulting deliveries will greatly impact the fortunes of the container market over the next few years as about 5 million TEU will be deliv ered during 2023-3024.

No container vessel has been demolished so far this year, but we do expect demolition activity to resume during the rest of the year and to take place in 2023. We expect it to be in the 200,000-300,000 TEU/year range, possibly higher if owners decide to demolish ships instead of paying for retrofits to com ply with EEXI. Our total fleet growth estimate stands at 2.9% for 2022 and 8.0% for 2023. Combined with growth of 2.9% in 2020 and 4.5% in 2021, the rate of fleet growth has ex ceeded head-haul and regional volume de mand when compared to pre-COVID levels. Congestion has meantime remained a drain on capacity supply; recent strikes in North Europe and a shift of US West Coast volumes to the East Coast have kept this very much


alive. According to Sea-Intelligence, conges tion peaked at 13.8% of the fleet size in Janu ary 2022 but had fallen to 9.6% by May 2022.

Congestion is likely to continue to be a driv er of vessel demand and capacity supply for a while, but from 2023, the implementation of EEXI will likely be a more significant factor where vessel demand is concerned. In our last report, we estimated that EEXI could result in a 5% increase in vessel requirements due to lower sailing speeds. Since then, Maersk has announced that they are likely to need 5-15% more vessels, while Hapag-Lloyd estimates an increase of 5-10%. Congestion could dis sipate in 2022 or by spring 2023 at the lat est. Reports are indicating a drop-off in vol umes to the US, while an apparent reduction in truck utilisation rates would help to clear congested container yards. In North Europe, recent strikes have temporarily worsened the problem, but if the lower year-to-date vol umes continue during the rest of 2022, then relief should also be seen here.

All in all, if we assume that:

– Vessel demand in 2023 increases by 10% due to EEXI

– Congestion reduces by 7-8%

– The fleet size increases by 8%

– Cargo demand increases vessel demand by 3-4%

Then we can conclude that the fleet supply/ demand balance will worsen in 2023 and lead to lower time charter rates and second-hand prices.


Global economic headwinds are adding many risks to container demand and upsides are difficult to identify. Consequently, we con sider our present head-haul and regional vol ume growth estimates of 1-2% reduction in 2022 and 3-4% growth in 2023 as best case.

The fleet supply/demand balance is pre dicted to worsen, and although carriers can maintain a tight cargo supply/demand bal ance by adjusting deployment, we predict that freight rates will continue to fall. At the very least, contract rates must be expected to again move below spot rates.

We therefore envisage a certain degree of “normalisation” during 2023, with much less congestion and reduced vessel delays. While we predict a reduction in freight levels, we do not think that these will revert to the very low pre-COVID levels.


Alstom, global leader in sustainable and green mobility solutions, re leased a new study today titled, “The Role of Urban Rail in Sustain able Africa” in collaboration with EY Climate Change and Sustainability Services.

As a contribution to the important discus sions taking place at the 27th Conference of the Parties (COP27), the study demonstrates how increased investments in urban rail trans port in Africa can facilitate the avoidance of substantial carbon emissions and contribute to broader sustainability goals, delivering en vironmental, social and economic benefits for Africa’s growing cities.

Africa has a fast-growing population and the world’s highest urbanisation rate. The conti nent’s urban population will increase from 600 million in 2021 to over 1.3 billion in 2050[1]. A key challenge is to ensure that this growth meets the UN’s Sustainable Development Goal 11: Making cities inclusive, safe, resil ient and sustainable. This new study shows that for this to happen African cities must advocate to develop more sustainable trans

port systems, both to reduce carbon emis sions and to foster inclusive socio-economic growth. “With COP27’s focus on implemen tation, Alstom commissioned this study with EY Climate Change and Sustainability Ser vices to highlight the many benefits that in creased investment in urban public transport can bring to Africa’s cities and support their sustainable growth. It is indeed demonstrat ed that every increase in a modal shift to rail tra nsport will bring better access to socioeconomic opportunities, reduced congestion, increased safety, and improved air quality on top of decarbonisation,” stated Cécile Texier, Vice President CSR and Sustainability, Alstom Group.

According to the International Energy Agen cy, passenger rail’s modal share has stagnat ed globally at around 6-7% for a decade and must grow by more than 40% in the next de cade for transport to remain on track to meet net zero. This study, therefore, highlights the benefits that can be realised if the modal share of urban rail in African cities increases to 10%

The Africa Logistics


in 2030 and 20% in 2050 (compared to the baseline scenario of 1% today). A cumulative total of 1,005 million tonnes (Mt) of CO2 (1 gigatonne [GT] of CO2) could be avoided be tween 2023 and 2050 in this scenario, com pared to the status quo. This is equal to 32% of Africa’s total GHG emissions in 2019. One hundred and seventy-three million additional tonnes of CO2 would be avoided between 2023 and 2050 if urban rail systems were fully powered with renewable energy. Invest ing further in urban rail would bring propor tional social and economic benefits leading to safer, healthier, and more inclusive cities. By increasing the modal share of rail to 20% by 2050, 29 million cars would be removed from Africa’s roads each day, leading to a signifi cant decrease in congestion, road accidents and air pollution. Urban rail is more afford able and more accessible than cars and un official transport systems, giving passengers easier access to jobs and key services such as education and health. This shift from road to rail could also support job creation related to construction and operations and mainte

nance in Africa estimated at about 258 jobs per kilometre of new rail built. For example, a 60-kilometre urban project would create over 15,000 direct jobs.

The study also highlights the benefits brought by Cairo’s long-term commitment to public transport. “With COP27 in Egypt, it is an opportunity to highlight that Egypt was the first country in Africa to open a metro line in 1987 and have 3 operational metro lines, 2 additional metro lines planned and 2 mono rail lines under construction. The additional metro and monorail lines alone, will allow the city to avoid a cumulative 35 Mt of CO2 emis sions between 2023 and 2050, equal to 10% of Egypt’s total GHG emissions in 2019. Ad ditionally, it provides the city with other so cial and economic advantages such as the reduction of 595,000 cars every day and a sharp reduction in congestion, estimated to cost Egypt USD 8 billion each year, savings that could be reinvested in green and digital mobility solutions,” concluded Andrew De Leone, President Alstom Africa, Middle East, and Central Asia. 31


The Africa Logistics AFRAA

Air connectivity brings together peo ple and businesses and serves as essential link between regional communities and the wider world. In Africa, air connectivity has been the main transport mode linking some landlocked and island communities to the world. The impor tance of these connections became evident during the two critical years of the Covid-19 crisis when travel stalled and trade suffered.

The aviation industry is on a recovery path from Covid-19 and projections are that growth over the next 20 years will be phenomenal. As an industry that has always taken its environ mental responsibilities seriously, long-term as pirational goals (LTAG) have been in the works and are now being concretized. The LTAG comes on the back of much earlier short to medium term environmental change mitiga tion measures that the industry initiated years back.

The industry has developed and is imple menting a range of standards, policies and guidance material aircraft noise and emis sions, technological improvements, operating procedures, proper organization of air traffic, appropriate airport and land-use planning, and the use of market-based measures.

IATA and ICAO Resolutions Aligned with the Paris Agreement

In a resolution passed at the 77th IATA AGM in Boston, USA, on 04 October 2021, the global airline industry committed to achieving net-zero carbon emissions from their opera tions by 2050.

This bold pledge brings air transport in line with the objectives of the Paris agreement to limit global warming to 1.5°C. The global civil aviation operations will achieve net-zero carbon emissions by 2050, supported by ac celerated efficiency measures, energy transi tion and innovation across the aviation sector and in partnership with Governments around the world. During the 41st ICAO general as sembly in Sep/Oct 2022 a resolution on the long-term aspirational goal (LTAG) of net-zero emissions by 2050 was overwhelmingly ad opted by member states. The agreement ad mitted that special circumstances and capa bilities of each country which could influence the outcomes. These factors will determine the ability of a country to achieve the target within its national timeframe.

A call for financial and technical support to developing countries for accelerated use of sustainable aviation fuels (SAF) was also endorsed to the pleasure of the developing countries. ICAO hopes that the net-zero tar 33 Environment

gets will rely on the adoption of new aircraft technologies, streamlined flight operations and the use of SAF.

The net-zero resolution also calls for the es tablishment of a climate finance initiative and voluntary technology transfer for developing SAF. The alignment of the IATA and ICAO res olutions to the objectives of the Paris Agree ment to limit global warming to 1.5°C is prob ably what the world has been waiting for to make the necessary changes that will make aviation more responsible and sustainable.

The road ahead will be challenging, but if we act and support each other as one avia tion ecosystem, we can make this a reality.

What Does Net Zero Emission Really Mean?

Put simply, it means removing an equal amount of CO2 from the atmosphere as we release into it.

The term net zero applies to a situation where global greenhouse gas emissions from human activity are in balance with emissions reductions. Net zero does not mean the ab sence of CO2, rather though CO2 emissions will continue, an equivalent amount of what is generated is removed from the atmosphere, thus resulting in zero increase in net emis sions. Achieving net zero by 2050 will require measures aimed at elimination of emissions at the source, offsetting and carbon capture technologies. AFRAA is convinced that, the aviation industry commitment to net zero CO2 emissions by 2050 would require supportive government policies backing the coordinated efforts of the entire industry (airlines, airports, air navigation service providers, manufactur ers).

Contribution of African Aviation Industry to CO2 Reduction

The aviation industry focus has always been to progressively reduce emissions while accommodating the growing demand of a population that is eager to fly. The ICAO Car bon Offsetting and Reduction Scheme for In ternational Aviation (CORSIA) is a key enabler of this goal. CORSIA will stabilize international emission levels in the short-tomedium term.

The current focus among African airlines is to reduce as much CO2 as possible through investment in new and modern aircraft, oper ating more efficiently and investing in smarter airport infrastructure and facilities. African airlines commitment to sustainable environ mental practices are noticeable through op erational decisions and policy changes as recommended by IATA and ICAO in the fol lowing areas: • Striving for the most efficient operations – flying more direct routes, aircraft continuous ascent and decent

• Investing in new and modern aircraft

• Taking measures to reduce carbon foot print

• Introducing recycling initiatives at their fa cilities

• integrating environmental concerns with all planning and decision making processes

• Adapting energy and water efficient prac tices

• Encouraging improvement in the perfor mance of suppliers through the development of environmental criteria within the framework of procurement policies.

Some 17 African countries have signed up for the voluntary phase of the CORSIA emissions monitoring and reporting. In co operation with IATA, Ethiopian Airlines, Kenya Airways and South African Airways among others launched Carbon Offset Program that

The Africa Logistics



2025 381 megatonnes (Mt) (2021 2025) 97% offsets, 2% SAF, 1% improvements above business as usual (BAU)

2030 979 Mt (2026 2030) 93% offsets; 5% SAF, 2% Improvements above BAU

2035 1,703 Mt (2031 2035) 77.5% offsets, 17.5% SAF, 3% improvements above BAU, 2% Carbon Capture Utilization and Storage (CCUS)

2040 3,824 Mt (2036 2040) 44.5% offsets, 40% SAF, 7.5% non drop in fuel (new propulsion technologies), 5% CCUS,3% improvements above BAU

2045 6,153 Mt (2041 2045) 55% SAF, 24% offsets, 10% non drop in fuel, 8% CCUS, 3% improvements above BAU

2050 8,164 Mt (2046 2050) 65% SAF, 13% non dropin fuel, 11% CCUS, 8% offsets, 3% improvements above BAU

offers customers the opportunity to contrib ute towards offsetting the CO2 emissions re lated to their flights.

The money raised through these schemes are invested in reforestation projects in the respective countries. In Ethiopia and Kenya, Boeing is working the airlines and govern ments to help the countries develop SAF feedstock production capacity.

Boeing is also working with Ethiopian Air lines to include aviation sustainability in the curriculum of the Ethiopian aviation Academy. In 2016, South African Airways (SAA) was the first African passenger airline to operate a flight using sustainable aviation fuel (SAF).

Similar SAF operated flights were subse quently conducted in Ethiopia and Kenya. However, the enthusiasm fizzled out due to lack of incentives and other challenges. AFRAA, AFCAC, IATA and ICAO have vari ously organized workshops and seminars aimed at sensitizing airlines on the environ

ICAO agree long term goal for international aviation (2022); energy sector commits to at least 6 million tonnes SAF production; agreement of full implementation of Article of Paris Agreement

Use of 100% SAF on aircraft, ANSPs fully implement ICAO Aviation System Block upgrades to deliver fuel efficiency improvements of 0.3% by 2030

Evolutionary technology achieving 30% reduction in fuel burn, electric/hydrogen aircraft for regional markets (50 100 seats, 30 90 min flights) become available

Feasibility of new aircraft such as blendedwing bodies demonstrated with full scale working prototypes, electric/hydrogen for short haul markets (100 150 seats, 45 120 min flights) become available

Necessary infrastructure for new energy requirements (low carbon electricity/hydrogen) becomes available

Commercially viable annual SAF production of 449 billion litres available

mental impact of their operations and mitiga tion measures for sustainability and net zero emissions. These have brought significant awareness on measure to be adopted to im prove the situation and build capacity at the operational level.

Industry Prescription for Achieving Net Zero Emissions

The transition needed to achieve global net zero emissions must be supported by a holis tic government policy framework focused on realizing cost-effective solutions and backed by the coordinated efforts of the entire indus try. The table below by IATA sets out the esti mated milestones towards net zero, including the mix of abatement measures and some noteworthy actions envisaged, A commit ment of resources, expertise and adherence to the proposed timelines could be the surest way for the industry attaining the ambitious goal on net zero emission by 2050. -AFRAA 35 ENVIRONMENT



It’s an exciting time for commercial avia tion in Africa. Across the entire continent, there are new trends and developments to respond to. Airlines on the continent are looking for smaller aircraft to imple ment into their operations, particularly narrow body types and regional turboprops and jets. In East Africa, we’ve witnessed an increase in activity and change in key players, with Addis Ababa in Ethiopia recently becoming the big gest connecting hub in Africa. There has also been a notable increase in activity in Central Africa, alongside the usual high levels across Southern Africa, which continues to be a dy namic aviation market.

Seizing the opportunities that exist in the African commercial aviation industry means being fully aware of – and being prepared to respond to – the developing trends and the challenges that exist across the regions.

Recession prompts growth in regional aircraft

It’s perhaps surprising to talk about oppor tunities given that the African Airlines Asso ciation (AFRAA) has predicted that the conti nent’s airlines will lose revenues of $4.9bn this year as the industry struggles to recover from Covid-19. Despite this, disruption leading to recession doesn’t necessarily lead to inactiv ity. Instead, a downturn shapes the prospects that exist. For commercial aviation, a reces sion creates a spike in demand for smaller air craft offering the lowest risk, typically regional turboprops and jets as well as narrowbody aircraft.

Across the continent, we are seeing a par ticularly strong interest in some of the turbo prop models – with more fuel-efficient aircraft offering better solutions for domestic opera tions. This is especially the case for custom ers who plan to fly to remote destinations.

Challenges faced by Africa

Alongside the many developments across

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Africa, there are also challenges that hold back the potential of aviation across the con tinent. Africa’s airlines face significant costs imposed on them by governments, fuel is up to 40% more expensive than elsewhere in the world, accessing financing can be difficult, and with no open-skies agreement regionally or across the continent, growth via route con nectivity is stifled.

Additionally, even before the pandemic, the airline analytics consultancy OAG noted that the sheer number of airlines operating in Afri ca posed a challenge, preventing each airline from building a solid base and financial and structural core to survive in the face of com petition and new entrants.

However, the market is shifting quickly, and the pandemic has caused the demise of some airlines in the region, bringing about consolidation.

Planning for the future

Despite the headwinds airlines face, we see a bright future for the African commercial avi ation industry, with growing demand across the continent.

While the short-term future of aviation is un

predictable, the sector has always been resil ient, and we can expect good things from the African market over the coming years. One development we are watching closely is the potential for the Single Market for Air Trans port in Africa (SAATM), with a pilot program being launched this November. Fourteen countries will take part, and we believe it is potentially the first big step in the right direc tion to advance the liberalization of civil avia tion in Africa and give impetus to the conti nent’s economic integration agenda.

For these, and all African airlines moving forward, it will be important to collaborate with expert partners, with the right combination of heritage, local knowledge and access to data to provide genuinely trusted advice. It’s this expert insight that we pride ourselves on at Jetcraft. Our commercial aviation team has been operating in Africa, particularly trading regional and narrowbody aircraft, since 2015. Our diverse offering includes jets from Airbus, Boeing, Bombardier, De Havilland, Embraer and other manufacturers.

To find out more about how Jetcraft Com mercial can help you seize opportunities in the African aviation sector, visit: 37

Amid food and climate crises, investing in sustainable food cold chains is crucial

As food insecurity and global warming rise, governments, international development partners and industry should invest in sustainable food cold chains to decrease hunger, provide livelihoods to communities, and adapt to climate change, the UN said today.

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climate in cold 39 ANALYSIS


Launched today at the 27th Climate Change Conference, the Sustainable Food Cold Chains report, from the UN Environment Programme (UNEP) and the Food and Agriculture Organization of the United Nations (FAO), finds that food cold chains are critical to meeting the challenge of feeding an additional two billion people by 2050 and harnessing rural communities’ re silience, while avoiding increased greenhouse gas emissions.

The report was developed in the framework of the UNEP-led Cool Coalition in partner ship with FAO, the Ozone Secretariat, UNEP OzonAction Programme, and the Climate and Clean Air Coalition.

“At a time when the international com munity must act to address the climate and food crises, sustainable food cold chains can make a massive difference,” said Inger Ander sen, Executive Director of UNEP. “They allow us to reduce food loss, improve food security, slow greenhouse gas emissions, create jobs, reduce poverty and build resilience – all in one fell swoop.”

Food insecurity on the rise

The number of people affected by hunger in the world rose to 828 million in 2021, a year-on-year rise of 46 million.

Almost 3.1 billion people could not afford a healthy diet in 2020, up 112 million from 2019, as the economic impacts of the Covid pandemic drove up inflation. This year, mean while, the conflict in Ukraine has raised the prices of basic grains threatening food secu rity.

All of this comes while an estimated 14 per cent of all food produced for human con sumption is lost before it reaches the con sumer. The lack of an effective cold chain to maintain the quality, nutritional value and safety of food is one of the major contributors to food loss.

According to the report, developing coun tries could save 144 million tonnes of food annually if they reached the same level of food cold chain infrastructure as developed coun tries.

As post-harvest food loss reduces the in come of 470 million small-scale farmers by 15 per cent, mainly in developing countries. In vesting in sustainable food cold chains would help lift these farm families out of poverty.

“Sustainable food cold chains can make an important difference in our collective efforts to achieve the Sustainable Development Goals. All stakeholders can help implement the find ings of this report, to transform agrifood sys

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tems to be more efficient, more inclusive, more resilient and more sustainable – for bet ter production, better nutrition, a better en vironment and a better life for all, leaving no one behind”

said QU Dongyu, Director-General of FAO.

Climate impact

The food cold chain has serious implica tions for climate change and the environment. Emissions from food loss and waste due to lack of refrigeration totalled an estimated 1 gi gatonne of carbon dioxide (CO2) equivalent in 2017 – about 2 percent of total global green house gas emissions.

In particular, it contributes to emissions of methane, a potent but short-lived climate pollutant. Taking action now would contribute to reducing atmospheric concentrations of methane this decade.

Overall, the food cold chain is responsible for around four percent of total global green house gas emissions – when emissions from cold chain technologies and food loss caused by lack of refrigeration are included.

Lost food also damages the natural world by driving unnecessary conversion of land for agricultural purposes and use of resources such as water, fossil fuels and energy .

Reducing food loss and waste could make

a positive impact on climate change, but only if new cooling-related infrastructure is de signed to use gases with low global warm ing potential, be energy efficient and run on renewable energy.

The adoption of the Kigali Amendment to the Montreal Protocol and the Rome Declara tion on “the contribution of the Montreal Pro tocol to sustainable cold chain development for food waste reduction” provide a unique opportunity to accelerate the deployment of sustainable food cold chains.

Progress being made Projects around the world show that sus tainable food cold chains are already making a difference. In India, a food cold chain pilot project reduced losses of kiwi fruit by 76 per cent while reducing emissions through the expansion of use of refrigerated transport.

In Nigeria, a project to install 54 operational ColdHubs prevented the spoilage of 42,024 tonnes of food and increased the household income of 5,240 small-scale farmers, retailers and wholesalers by 50 per cent.

But these projects, which are illustrated among many other case studies in the new report, are still the exception rather than the norm.

Recommendations for decision makers

To expand sustainable food cold chains globally, the report issues a series of recom mendations for governments and stakehold ers, including:

• Take a holistic systems approach to food cold chain provision, recognizing that the provision of cooling technologies alone is not enough.

• Quantify and benchmark the energy use and greenhouse gas emissions in existing food cold chains and identify opportunities for reductions.

• Collaborate and undertake food cold chain needs assessments and develop cost ed and sequenced National Cooling Action Plans, backed with specific actions and fi nancing.

• Implement and enforce ambitious minimum efficiency standards, and monitor ing and enforcement to prevent illegal imports of inefficient food cold chain equipment and refrigerants.

• Run large-scale system demonstra tions to show positive impacts of sustainable cold chains, and how interventions can create sustainable and resilient solutions for scaling.

• Institute multidisciplinary centres for food cold chain development at the national or regional level. 41 OPINION
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