WINDHOEK – Namibia’s logistics costs declined significantly by 11.4 percent to stand at 15.6 percent in relation to gross domestic product (GDP) in 2017 having peaked at 17.6 percent in 2016. This is according to the recently released first-ever Annual State of Logistics Report for Namibia 2018. With this first edition of its State of Logistics report 2018, Namibia has joined a relatively exclusive group of countries that have established a national assessment of its logistics. The report was commissioned by the Walvis Bay Corridor Group (WBCG) with the support of Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, and was prepared by Prof Kenneth K. Odero and staff of the Namibian-German Centre for Logistics (NGCL), Namibia University of Science and Technology (Nust). The report shows that the growth trajectory of the main components of the GDP followed more or less a similar path, noting that the recent surge in fuel prices, as well as changes in the wholesale and retail trade sectors are some of the factors likely to have an effect on (domestic) logistics costs in 2018.
In terms of international logistics, the report points out that Namibia logistics performance index (LPI) score of 2.73 (aggregated 2012-2018) makes it part of the top 50 percent internationally. “All six dimensions of trade analysed in the International LPI point to a resilient performance. However, sustainable growth is required to ensure regional competitiveness given developments in other emerging African countries with ports such as Tanzania and Mozambique,” read the report’s executive summary.
The report continued that Namibia’s performance in areas such as trade, community involvement, documents, automation, and information availability improved over the 2015-2017 period, though there was a decline in appeals procedures as well as in governance and impartiality based on the trade facilitation indicators.
Meanwhile, according to the report, the Port of Walvis Bay, the leading commercial port in the country, handled 93.1 percent of total cargo (gross tonnage) transiting to and from the neighbouring countries in 2017. Of the eight or so countries that use the Port of Walvis Bay for imports and exports, Zambia, Angola, Democratic Republic of Congo, Botswana and Zimbabwe are the main markets for transit cargo by volume. In addition, Zambia was identified as the dominant market for transit cargo among these countries, which accounted for 51.8 percent of all inbound transit cargo via the Port of Walvis Bay in 2017, up from 47.9 percent in 2016. This represents a 50.9 percent increase in the volume of imports to Zambia. Similarly, Zambian exports comprising mostly copper and wooden products accounted for 85.7 percent of total outbound transit cargo by volume (metric tons), up from 72.5 percent in 2016. Furthermore, the report also shows that Namibia’s track railway network transports approximately 1.2 billion tonne-kilometre of cargo annually. The railway system moved 1.58 million metric tons of various commodities (both bulk and containerised freight) in 2017. This sharply contrasts with road freight which accounts for more than 80 percent of total tonne kilometres of goods transported in Namibia include transit cargo. Of the three corridors connecting Walvis Bay with countries in the Southern Africa Development Community (Sadc) region, Walvis Bay-Ndola- Lubumbashi-Development Corridor is the busiest, followed by Trans-Cunene and Trans-Kalahari Corridor in that order with respect to transit cargo.
“Generally, inbound transit cargo based on total volumes disaggregated into container and dry-bulk cargo seems to be much more diverse in terms of destination countries, compared to outbound cargo, which is dominated by Zambia. There is relatively less diversity in terms of the distribution of containerised and break-bulk exports by country of origin,” the report reads.
The document also showed that recent (2018) throughput at the Port of Walvis Bay showed improvement with volumes for September 2018 having surpassed the 2017 by 6,159 metric tons (or 9.2 percent, from 66,769 tons in September 2016 to 72,928 tons by September 2018).
“The year 2018 is likely to become a very good year for the Port of Walvis Bay since the cargo volumes for the period January-September already exceeds numbers for 2017,” the authors of the report concluded.
Also, the report indicated that the capacity of Port of Walvis Bay is expected to increase as a result of ongoing investments projects. Thus, greater attention is required in managing international logistics sustainably to ensure that Namibia could become a “logistics nation” for the Sadc region by 2025.
Other likely areas of growth in 2019 and beyond, as identified in the report, include progress in deepening the Botswana-Namibia rail link framework, the anticipated start of South African manganese exports through the Port of Lüderitz, growth in throughput to and from Zambia comprising copper (export) and frozen foods (import), as well as the much anticipated increase in transit volumes destined to Zimbabwe.