CMA CGM betting big on Africa as future production hub for world
From new vessels to terminals, inland services and door to door solutions, CMA CGM is investing in future while also committed to protecting its environment.
The French shipping giant is pushing hard to increase its logistics capabilities in the continent as it visualises Africa as a potential production hub. From new vessels to terminals, to inland services and door to door solutions, CMA CGM is eyeing a move towards a sustainable future.
In a recent attempt to increase its market share in Kenya against Maersk and MSC, CMA CGM’s Africa vice president Ludovic Rozan demanded that the Kenya Ports Authority provide a dedicated berth at the Port of Mombasa for doing business in the newly opened Port of Lamu, according to Kenya News Agency. This will allow the shipping line to operate round the year from this region, while at Lamu Port it will be able to move transhipment cargo to Tanzania, Ethiopia, South Sudan, Somalia, Mombasa and Mozambique.
The CMA CGM Group is the second-largest shipping company in the African continent, with a presence in 54 countries with a network of 76 agencies. The group is operating 34 weekly services to/from Africa, thanks to a fleet of 200 ships calling at 118 ports. Currently, the group has 5 major owned terminals including Tangier, Kribi and Reunion Island. Through CMA Terminals, the CMA CGM Group operates seven terminals in Africa. The group transported almost 1.9 million TEUs in Africa last year.
“One of the reasons why customers choose CMA CGM is our expertise, thanks to a solid background,” said the CMA CGM Group while responding to Logistics Update Africa.
“One of CMA CGM Group’s strengths on the African continent is its investment in brand new vessels, from 10,000 TEU vessels on long-haul routes to small dedicated tailor-made supply solutions and in 15 inland depots through CCIS (CMA CGM Inland Services) and TBL (Through Bill of Lading) inland solutions (trains/rail and trucks),” it added.
The group identifies terminal infrastructure as a key challenge for the development of logistics activities in Africa and expressed its commitment to participate in the development of port infrastructures in Africa. In line with this, the group is investing in the Lekki deep seaport, which will be Nigeria’s first deep seaport upon completion in 2022.
“Lekki Port will be equipped with a 1,200-meter-long quay as well as 13 quay cranes and will have a capacity of 2.5 million TEUs. Thanks to its 16-meter depth, Lekki Port’s container terminal, which CMA CGM will operate through our subsidiary CMA Terminals, will allow us to bring larger containerships, of up to 14 000 TEU, from Europe and Asia to Nigeria,” the response reads.
It is no secret that shipping giants like Maersk and CMA CGM are on a mission to position themselves as market leaders with a shipping line and also as an integrated logistics service providers that provide end to end solutions. In an attempt to reach out to the shippers directly and control the entire supply chain, both are acquiring logistics and service companies across the world.
“In addition to historic ties with the African continent, the strategic vision implemented by the group’s CEO, Rodolphe Saadé, has made it a global leader in logistics: the CMA CGM Group is now able to offer its customers fully integrated door-to-door solutions,” the group said.
In April 2019, CMA CGM completed a public tender offer to acquire CEVA Logistics. Through its presence in 42 African countries, it has enabled CMA CGM to offer land and air freight connectivity to its customers. In fact, CEVA Logistics is at the heart of CMA CGM’s plan to conquer the challenging logistics terrain of Africa.
The company said, “CEVA Logistics’ strategy has always been focussed on a corridor approach, connecting Africa extensively through the ocean gateways and building synergies with the CMA CGM Group.”
Freight forwarding is playing a key early role for CEVA Logistics in Africa. In 2020 CEVA, acquired AMI Worldwide, then further expanded its presence in Mauritania, and later formed joint ventures with MACCFA Freight Logistics in Ethiopia and IBA Freight Services in Egypt. This January CEVA further expanded its footprint and capabilities by acquiring the ASTI group in Morocco.
“By acquiring AMI Worldwide, CEVA Logistics is now able to offer a range of multi-modal logistics solutions, across eastern and southern Africa. With its global network, CEVA Logistics is now fully equipped to develop key strategic trade lanes to Africa,” the group said.
The CMA CGM Group is a key player in Africa as far as intermodal solutions are concerned. As a continued effort to offer new intermodal and multimodal logistics services in the continent. In line with this, on July 15, 2021, the group announced two weekly inland train solutions, from/to Aswan, Egypt and in Zimbabwe from Maputo Ramp, Mozambique.
The group provides intermodal solutions in more than 40 African countries, offering over 400 inland locations. CEVA Logistics also offers a wide range of services (customs clearance, transit, transportation, deliveries) to importers and exporters on the main corridors to connect the main ports and airports to the hinterland.
The company said, “On each of these corridors, depending on the available infrastructure, we offer rail, road or even combined rail/road services to our customers.”
CEVA Logistics’ intermodal sites are a launching platform for its freight management ambitions. They offer freight forwarding services in addition to CEVA’s full range of inland solutions that are connected to container fleet management or ocean freight value-added services.
“These value-added offerings include reefer (refrigerated container) management services, stuffing and de-stuffing of containers, dry port and container depot functions,” reads the response.
The company noted that the further development of road and rail networks will be key in enabling smoother operation on the African market, particularly in landlocked countries such as Mali, Burkina Faso, Chad, or the Central African Republic.
“Today, rail networks are more developed in East and South Africa, with regular rail services available from Kenya, Tanzania, Mozambique and South Africa. In West Africa, rail solutions are available in the Ivory Coast and Cameroon,” it added.
In June 2021, the CMA CGM Group launched a global communications campaign known as ‘Better Ways’ with sustainability and protection of the planet as a key pillar of its development. This will have interesting dimensions in Africa as the continent with its rich and diverse environment and the protection of flora and fauna that needs conservation.
“A growing area of concern for the group in Africa is the issue of traffic of protected species,” the group said.
CMA CGM has reinforced control measures for the transportation of protected species, and it has established a blacklist of freight forwarders suspected of being involved in those traffics. The shipping line said that this entailed giving dedicated training to their commercial agents, in coordination with the CMA CGM Academy.
“The group took the unprecedented decision of suspending all wood exports from the Gambia, after the presence of undeclared rose wood in laden export containers. Indeed, the exploitation of rose wood is illegal and contributes to deforestation in West Africa. This highlights the group’s ambition to be an industry leader in the protection of the environment,” reads the group’s release.
In addition to retail and consumer goods, CMA CGM noted that customers in telecom, automotive, technology and healthcare industries were encouraging CEVA to expand its presence into Africa.
As the group puts it, “Africa could be an area of potential production for the world market, creating an opportunity for our contract logistics expertise.”