October 14, 2021
THE modernisation and expansion of three ports in Egypt, Senegal and Somaliland will improve access to vital goods for 35 million people in Africa, support five million jobs (138,000 of which have already been created) and add $51 billion to the continent’s total trade by 2035, according to the investors in the multi-billion-dollar projects.
DP World, a specialist in global supply chain solutions, and CDC Group, the UK’s development finance institution and impact investor, have entered into a long-term partnership to accelerate and sustain the continent’s trade potential and transform the prospects of millions of people.
The initial focus will be on the ports in Sokhna in Egypt, Dakar and Berbera in Somaliland, with further ports and logistics investments across Africa to follow, DP World and CDC said in a statement.
With a sixth of the world’s population, Africa accounts for just four percent of global containerised shipping volumes, according to the UN Conference on Trade and Development’s Review of Maritime Transport 2020.
Although ports are vital to the long-term prosperity and wellbeing of countries, many of these facilities in Africa currently lack the capacity to meet the needs of local economies.
Sultan Ahmed Bin Sulayem, Group Chairman and CEO of DP World, said the company “views Africa as a long-term growth market and the opportunity landscape remains significant”.
Nick O’Donohoe, Chief Executive Officer of CDC Group, said: “Stable and flourishing economies are built on reliable access to global and intra-continental trade.
“Africa’s full potential is limited by inadequate ports and trade bottlenecks, putting the brakes on economic growth in some of the world’s fastest-growing economies and undermining social resilience in the least developed parts of the world.”
He added: “This platform will help entrepreneurs and businesses accelerate growth with access to reliable trade routes and it will help African consumers benefit from the improved reliability and reduced cost of vital goods and food staples.”
DP World is contributing its stakes in the three existing ports initially and expects to invest a further $1 billion through the platform over the next several years.
CDC is providing $320 million initially and expects to invest up to a further $400 million during the next few years.
In 2035, an estimated $51 billion in additional trade is forecast to pass through the ports, equivalent to three percent of Egypt’s GDP, three percent of Senegal’s GDP and six percent of Somaliland’s GDP.
The ports are also expected to provide a gateway to international markets for countless African businesses and entrepreneurs, as well as supporting the growth of nascent export industries currently stymied by logistics inefficiency.
The UK Foreign Secretary, Liz Truss, said the new partnership between CDC and DP World would boost jobs and drive economic growth in Africa.