Dry ports give way to logistics zones in Algeria due to success in reducing maritime congestion

In recent years Algeria has developed a large network of both public and privately owned dry ports, aimed at reducing congestion in maritime facilities by quickly moving exported goods out of seaports to be processed elsewhere, often via rail connections.

While the initiative has proven successful, moves to expand seaport capacity mean that the authorities no longer see a need to develop further dry port facilities, and are now focusing their attention on the construction of a network of fully-fledged logistics zones to be linked to key seaports via rail, the first of which was inaugurated in early 2016.

Dry Ports Develop

The first dry ports to be developed in Algeria were established by the government. However, since 2010 independent operators have begun developing similar facilities of their own, and there are now 11 public and five privately owned facilities of this type in the country.

The latest dry port to be inaugurated, in May 2016, is located in Rouiba, an industrial area just outside of Algiers. The facility is intended to reduce congestion at Port of Algiers, and will be managed by Algérienne Intermodale Logistique du Centre, a state-run company launched in 2014 as a joint venture between the management company of the Port of Algiers, Entreprise Portuaire d’Alger, which has a 64% stake in the firm, and state-owned freight company Société de Transport Intermodal de Marchandises, a subsidiary of the National Rail Transport Company, with a 36% share. Containers will be transported to the facility by way of a rail link from Port of Algiers.

Echoing other industry figures, Rachid Ghezlaoui, CEO of local freight-forwarder Transrafa, told OBG that the dry ports network had worked well to achieve its aim of reducing congestion at Algiers port, particularly for imports. “The network is mainly based around Algiers,” he said. “It would be good to see more facilities established around other major hubs, such as Annaba, Oran and Mostaganem. Existing ports also lack resources in many areas, such as refrigeration.” The authorities have also tried to keep dry ports away from populated areas because of the substantial vehicle traffic they generate, which has meant that road connections to them can be of variable quality.

At present, the government does not intend to expand the network of dry ports further, focusing instead on the development on new logistics zones as well as improving capacity at the nation’s seaports. “The dry ports near the seaports are only necessary because of current constraints at the ports, and will no longer be required once the seaports become sufficiently efficient,” Adlane Belabdelouahab, CEO of Arkas Algeria, told OBG, although he also said that inland dry ports located far from maritime facilities and bounded areas connected to the railways would remain beneficial as inland industrial hubs develop.

Logistics Zones

Now, plans to establish five major new logistics zones mean that Algeria’s logistics sector is on the verge of major change. While these zones have often also been referred to as dry ports in the local press, the authorities are keen to emphasise that they are fully fledged logistics zones, which will offer a much wider array of services and facilities, including warehousing, cold storage and packaging. The first of these, known as Tixter and located in the Aïn Taghrout region of the eastern province of Bordj Bou Arréridj, was inaugurated in March 2016 and entered into operation the following August. The 20-ha zone is linked by rail to Béjaïa port, located around 190 km away. Work is also under way to build a 48,560-sq-metre logistics zone for Béjaïa port at Ighil Ouberouak, 5 km away.

In light of current budgetary constraints, it is unclear when work on the remaining logistics zones will begin. However, further zones could also be created by upgrading existing dry ports. According to Belabdelouahab, doing so would make sense once seaports had achieved sufficient levels of capacity and efficiency to reduce the need for the current number of dry facilities.