Maritime links: Improved port infrastructure and services to facilitate trade

The dilapidated state of some of the country’s infrastructure, not to mention limited access to it, has in recent years made it difficult for maritime transport operators in Gabon to keep up with the growing pace of demand driven by extractive industries, construction and forestry (see Mining chapter). To make sure maritime transport continues to play a key role in Gabon’s economic development, and maintains its 90% share of the country’s trade, the government has adopted various measures to help stimulate investment.

IMPROVING INFRASTRUCTURE: A number of investments have been undertaken in recent years to tackle growing demand, most notably in infrastructure. In 2007, the Société des Terminaux de Conteneurs du Gabon, a consortium between two French firms, Getma-Necotrans and Bolloré, invested about CFA12.3bn (€18.45m) in Owendo to build and manage a new container terminal, which began operations in 2009.

In 2011, Gabon Ports Management (GPM), a subsidiary of the Singapore-based Portek International, itself a part of the Japanese group Mitsui, invested about CFA7bn (€10.5m) to acquire two cranes. Delivered in April 2012, the mobile harbour cranes were able to raise the number of container moves per hour from eight to 25 in August 2013, reported Portek. Before delivery, operators relied on standard vessel cranes to move containers. Considering earlier statements announced a larger improvement margin, up from 8-10 to 30-40 container moves, productivity may still increase at the docks. In the meantime GPM has bought an additional crane to further tackle traffic congestion at Owendo. “The third crane, costing CFA2.5bn (€3.7m) to CFA3bn (€4.5m), is set to come on-line in October 2013 at the latest,” Philippe Géry, CEO of GPM, told OBG. As all three cranes are phased in, productivity in container moves is expected to further improve, with a potential positive effect on transport prices as waiting times on the docks diminish. In 2012, the average waiting time for container and roll-on, roll-off vessels varied between four and a half days and six days. “On an annual basis, the volume of containers has been growing by 3% to 4%. However, we still face some congestion issues in the port of Owendo, which has decreased thanks to a new third crane that operates more efficiently on conventional and container vessels. If logistical issues are improving despite a lacking infrastructure, issues with repetitive and unexpected staff movements create delays and decrease performance in deliveries,” Bertrand Rose, CEO of Getma Necotrans Gabon, told OBG.

Other efforts to develop Owendo’s capacity include the construction of a fourth quay at a cost of about CFA40bn (€60m), expected to be ready in 2015, and a CFA30bn (€45m) extension of the 455-metre commercial quay by 500 metres. According to Rigobert Ikambouayat Ndeka, CEO of the Ports and Harbours Office of Gabon (Office des Ports et Rades du Gabon, OPRAG), construction work to extend the quay began in February 2013 and should last 24 months. The extension is set to add enough room to accommodate up to four boats, up from the current two boats. Once completed, these infrastructure improvements should allow Owendo to better cope with container traffic, which has been increasing at a rate of 7-10% since 2009.

ENSURING SECURITY: The government is also working to bring its services up to international standards, including in terms of security. In February 2013, it signed a CFA8.64bn (€13m) contract with Switzerland-based Cotecna Inspection to supply, install and operate scanners in the country’s two leading ports, Owendo and Port-Gentil. The equipment, scheduled for installation in September 2013, is designed to not only improve security, but also facilitate inspections, potentially saving time for transport operators.

Other advantages included improvements in combating illegal trafficking, Customs duties collection, technology transfers to the government and operational standards. “The scanners could be useful in improving maritime transport to such countries as the US that employ high standards of security,” Pablo Andres Alvarado Salinas, the CEO for Maersk Gabon, told OBG. In addition, the contract with Cotecna covers constructing a vocational training centre for the Customs administration in Leconi, in the south-eastern department of Haut-Ogooué. In terms of by number, the “2011 Statistical Booklet of the Gabonese Shippers Council” says North America was Gabon’s third container export destination in 2011, representing 7.80% of container exports, behind Europe (34.57%) and Asia (52.78%).

TRAINING: Investment in human resources (HR) has been a priority for maritime transport operators. One initiative in particular, the UN Conference on Trade and Development’s (UNCTAD) Modern Port Management Programme, has been revived in recent years. In January 2013, 16 port officials graduated, marking the closure of Gabon’s fourth training cycle. From 1998-2002, UNCTAD ran three training cycles with OPRAG, certifying 48 middle managers, as well as training 40 senior managers as trainers. Gabon left the programme in 2002, but, following a set of port sector reforms, rejoined in 2010 to further invest in HR development.

Such training initiatives are well regarded by operators in the Gabon maritime transport sector, which also carry out their investments in HR. “Lack of competences at the local level poses a challenge; trainings are essential to improve productivity,” Géry told OBG. GPM has its own professional training programme. “In 2013, 80% of our staff will have taken part in trainings of a diverse character, including linguistic and technical matters,” he added. GPM has also found a way of optimising its training resources. Instead of sending agents abroad, it now brings in trainers to teach a group of workers based on the company’s needs. “We have invested about CFA400m (€600,000) to CFA500m (€750,000) in training each year since our creation in 2007 and the results are visible,” Géry added. “Our employees are increasingly adhering to training and the work environment is improving, as is our business.”

REMAINING CHALLENGES: Several issues need to be addressed in order to improve maritime transport capacity and productivity. A limited number of quays and storage capacity at Owendo, for example, currently hinders the flow of cargo, translating into longer waiting times (despite recent improvements with the installation of two cranes). Further efforts are being undertaken to improve port capacity in Libreville. GPM, for example, is reorganising yards and quays to optimise space. Other obstacles could nonetheless require the development of alternatives to existing ports. As major extractive industry projects come on-line in the medium run, Gabon is likely to require appropriate facilities for exporting extracted resources, especially a deepwater port. Located in the south-west of the country, Mayumba is considered an option for the export of such resources as iron, wood, oil, talc, gold, manganese, marble, and a number of agricultural and fish products. A preliminary study has already been undertaken, the results of which have estimated a build cost of about €260m, to be eventually financed by a public-private partnership. By April 2012, however, there had been no follow-up on this study, with the National Agency for Public Works moving forward instead with a general analysis of the economic potential of all country ports so as to develop a plan for needed infrastructure improvements.

As special economic zones (SEZs) like Nkok develop, producing a diverse set of goods for export such as processed timber, maritime transport traffic is likely to increase, generating further congestion if infrastructure improvements are not carried out in time. One such improvement consists of paving of the Nkok SEZOwendo road, which is set to improve circulation between the SEZ and Owendo Port.

Infrastructure improvements on site should smooth the flow of transport and trade in the short to medium term. Investments in security, if well employed, may also speed up processing of containers, saving time on the ground and potentially contributing to a reduction of costs. Investments in HR are more likely to have an effect over the long term, even if positive changes at the workplace are already visible.

Ultimately, continued government support for the development of maritime transport, together with public and private sector investment to channel current and future goods as economic projects come on-line, will likely continue providing investment opportunities.