Logistics infrastructure developments on the agenda in Ghana

Ghana makes headway to establish itself as an important gateway to the West African market. Despite factors like plunging oil prices impacting the economy, the country has seen major developments like Swissport Ghana and the new state of the art cargo centre at Kotoka International Airport in the recent times to maximise its trade potential. Twinkle Sahita reports.

With more than 25 million people, Ghana, one of the fastest growing economies in Africa, ranked 88th out of 160 countries on the latest World Bank’s Logistics Performance Index (LPI) 2016. It outpaced Nigeria in LPI 2016. Considered a major gateway in West Africa, Nigeria stands at 90th position in the LPI 2016.

Ghana’s market is extremely competitive and it has been hit hard in recent years with very high inflation and a sluggish economy. Despite the political situation being stable, there is a need for the economy to stabilise to bring about economic recovery. The major imports are consumer electronic goods, mining spares, oil related spares. On the export side, it is almost 100 percent perishable goods fruits and vegetables. South African Airways Cargo cites lower oil and commodity prices as the reasons for African economies to be under strain. Despite the obstacles, it plans intra Africa expansion. “In West Africa routes, sectors already serviced and expanded out of Johannesburg is Abuja, Nigeria, Lagos, Cotonou, Dakar-New York sector, Abidjan and the Accra-Washington DC sector. In addition, we have planned to implement about three freighter routes in the southern region. We will also have additional frequencies to some of the routes already being operated,” says Tleli Makhetha, general manager, South African Airways Cargo. Cargolux, Europe’s leading all-cargo airline, handles 5000 tonnes of imports and 4000 tonnes of exports per year in Ghana, also finds crisis in oil industry a major challenge. “The plunge in oil prices has affected the economy in Ghana and this has also had an impact on the oil equipment/supply business which has fallen in recent months. While the oil industry has been impacted, there has still been a growth in imports and exports in other sectors which has still led to an overall growth in imports and exports,” says Jonathan Clark, regional director Africa, Cargolux. At the moment, Cargolux has no plans to expand services to/from Ghana, however if the market picks up in the future or if they see the potential to operate a hub and spoke system with a reliable partner in Ghana, then they would expand services. Trade represents a significant portion of every country’s economic growth. African continent still isn’t a major source of exports and its consumer markets are tiny in comparison to Asia, Europe or the Americas, despite its enormous size. Apart from the current challenges, lack of efficiency in infrastructure has been decreasing the competitive levels of this major continent. Out of the eight airports, the country has only one international airport in Accra (Kotoka International Airport). For airfreight, Kotoka in Accra is the only gateway in Ghana as there is no viable alternative airport.

In the coming years, the current scenario is expected to change with these necessary developments. Ghana Airport Cargo Centre (GACC) built a new cargo centre at Kotoka Airport to address the current infrastructure, capacity and operational challenges to handle air cargo at the airport. The development project will offer a state of the art cargo warehouse to increase capacity and improve operational efficiency of air cargo handling. It will be operated by the leading independent cargo handler Swissport International. GACC is a joint venture between Air Ghana and the Ghana Airports Company, the operator of all airports and aerodromes in Ghana. Swissport Ghana, equally owned joint venture company between Swissport International and GACC, started operations in October 2015. Its facility at Kotoka International Airport has 10,000 square metres of warehousing space to cater for perishables, valuable and dangerous goods. Ghana also plans to make its sea ports a maritime hub for West Africa. Domestic maritime trade is served by two ports: Tema, around 25 kilometre east of Accra, the capital; and Takoradi, 230 kilometre to the west. The two ports handle more than 90 percent of foreign-trade volume. The $1.5 billion plan to expand the Port of Tema into a new West African regional port and logistics hub is underway. Meridian Port Services (MPS), a joint venture of APM Terminals, Bolloré Africa Logistics and Ghana Ports and Harbours Authority (GPHA), which operates the container terminal in Tema Port, will develop four deep-water berths, a new breakwater and an access channel able to accommodate the world’s largest container ships. This will add 3.5 million TEUs in annual throughput capacity. The expansion project includes plans for the potential construction of additional terminal facilities, including bulk, liquid bulk and general cargo terminals, as global trade with Africa continues to accelerate. Road transport is by far the most important means of moving freight in Ghana and is the sector that requires the greatest consideration. Commensurate efforts are required to revamp the road sector as it plays a pivotal role in contributing towards economic growth. “The volume for cargo industry will continue to grow both in air and ocean as economies grow and more and more investment takes place in West Africa. The rate of growth is something that cannot be forecast accurately, but I strongly believe that if there is investment in the infrastructure, competitive products to export, political stability and more simplistic ways for foreign companies to do business in Africa, then there will be a bright future in Africa,” adds Clark, Cargolux. Ghana will continue to foster its competitiveness in African market with a focus on enhancing its transport and logistics sector. Time and again, Africa’s economies have surprised the world with the speed it is moving towards development.