At a time when projects to modernize and expand African ports are multiplying, the authorities must deal with an uncertain economic context and an operational performance still below world standards.

Ports constitute strategic infrastructure in the development of African countries, but the risk of overcapacity is material in a context of shrinking trade and heightened competition between African ports. In order to accommodate ships of 9,000 TEUs (standard size for ships worldwide), to follow world standards in terms of draft and to ensure transhipment, modernization and extension projects have multiplied. these last years. In fifteen years, investments have multiplied by thirteen compared to 1990-2004 and port investments amounted to $50bn in sub-Saharan Africa between 2007 and 2017 according to a Proparco study.

On the western side, competition between ports is indicative of a trend at work across the continent. The Lomé project worth $380m in 2014 faces that of Abidjan for an amount of $930m launched in 2015 or that of Lekki which should begin operations in 2023 and be able to accommodate vessels with a capacity exceeding 18,000 TEUs.

The logic of profitability and prudence does not always seem to govern the launch of these new projects which contribute to the overcapacity of the ports of the region. On the eastern side, fears surround Kenya's Lamu Port project with its Lamu Port-South Sudan-Ethiopia-Transport (Lapsset) corridor supposed to link the landlocked countries of South Sudan and Ethiopia to the Indian Ocean. . The economic viability of the project, which includes the construction of new towns and a liquefied natural gas (LNG) plant, is challenged by the substantial financing needs, the risks of land speculation, political instability in South Sudan as well as the low interest expressed by freighters. This project illustrates the lack of alignment that sometimes exists between projects initiated by government authorities and shipowners' expectations.

In a context where the United Nations Conference on Trade and Development (UNCTAD) estimated the drop in Africa's exports at (35)% and the drop in its imports at (25)% for the second quarter of 2020, we can legitimately wonder about the risks of overcapacity. It would seem more prudent to favor phased developments with an emphasis on operational efficiency and significant efforts to put an end to bottlenecks.

The value and efficiency of a logistics chain, particularly in a port, is measured at its weakest link. However, for African ports, this link weakens the entire chain: handling. The port's logistics value chain is a perpetual restart: storage, transport, handling, transport, etc. Infrastructure is certainly sometimes deficient in African ports but cannot be held solely responsible. For example, one of the most modern ports in Africa and in the world, Durban, processes 30% fewer TEUs per hour than that of Rotterdam (respectively 55 TEUs/h against 80 TEUs/h). As for the port of Monrovia in Liberia, it hardly does better than 12 TEU/h.

In addition, handling operators are only rarely challenged on their efficiency performance in handling goods. African operators must therefore be trained and embarked on a win-win logic of continuous improvement in handling efficiency. Despite available space and cheap labour, the average cost of managing, storing and local delivery of a container is six times higher in Africa than in Europe. Dry ports and other bonded warehouses are not common around African ports. Their development would have a double impact on the efficiency and attractiveness of these ports: on the one hand, it would unclog the quays, with the help in particular of a punitive policy for goods parked too long, and on the other hand , would make the roads around the port more fluid, responsible for the congestion of many port cities.

Moreover, apart from rare exceptions, port investments struggle to be accompanied by economic dynamism around the areas concerned. The proliferation of port projects is not always accompanied by the anticipated knock-on effects at the economic level. The ports built are not often integrated into national projects aimed at the development of industries taking advantage of national resources and geographical proximity to maritime infrastructures. If ports such as Mombasa with its oil refining activity and shipyards, Port Said with fishing and its chemical and food industries or Durban with its sugar, textile and automobile industries have succeeded in creating industrial port complexes, these examples remain too few.

Port investments must therefore be thought of as a link in the development chain and not as a sufficient condition for development. In particular, countries with a port coast should rely on their comparative advantages and their factor endowments in order to create ripple effects around port areas so as to create virtuous circles between economic development and port dynamism. As such, the port of Tangier Med is an exception with its million vehicles exported each year and an annual export business volume in 2019 of €8bn.

The ecological impact should not be neglected either since maritime transport is responsible for approximately 2.5% of global greenhouse gas emissions and this share could, with the help of increased traffic, increase by 50 to 250% d by 2050. The African continent will be one of the continents most impacted by climate change, whether inland with increasingly frequent droughts and floods or on the coasts with rising and warming waters.

In this context, African ports have a dual role to play in the fight against polluting emissions. First of all, the port authorities must supervise this pollution in order to preserve their maritime facades, sources of economic wealth with fishing and agriculture, but also tourism. Discharges that are harmful to the environment are numerous in and around the port: leakage or even spillage of hydrocarbons, air pollution by the engines of ships and trucks, multiple wastes. The recent example of the Japanese bulk carrier flying the Panamanian flag stranded off the coast of Mauritius, causing an oil spill and an ecological and economic disaster for this island whose tourism represents +15% of GDP, raises the question of legislation around ships under flags of convenience. The ports accepting the mooring of these vessels, whose safety and maintenance rules are not very restrictive, expose themselves to sometimes very costly mishaps.

The port and national authorities must therefore take this new data into account from now on both in existing concessions and also in new calls for tenders by including ecological performance indicators in order to get private operators on board in this green logic.

The shift in the center of gravity of international trade towards Asia is reshaping the economic and geopolitical maps at the global level. Two out of three containers now come from Asia, which favors certain ports such as Djibouti and penalizes others such as those on the western side.

The deployment of the Silk Road from Shanghai to the Port of Pirhée makes Djibouti a strategic position at the crossroads of Africa with Asia and the Arabian Peninsula. Ideally located between the Red Sea and the Gulf of Aden, Djibouti has the potential to become a major hub for bypassing the Middle East in order to reach Europe. The construction of the port of Doraleh in Djibouti in a record time of 30 months by China Merchant Holdings symbolizes this Chinese interest in this geographical area.

This shift is reflected in economic partnerships but also in military establishments. At a time when the interest of the United States for this geographical area seems to be declining, the inauguration of a Chinese military base in Djibouti in 2017 contrasts with this positioning. Similarly, Russia is beginning a geopolitical return to the African continent with the creation of a Russian naval base in the Red Sea for the supply of its fleet, authorized by Sudan.

African ports must therefore take into account the redistribution of the economic and geopolitical cards that is currently at stake. Looking to the future, they must build a strategy and position themselves in such a way as to be fully integrated into the new routes of world trade.

A new roadmap is therefore needed to enable African ports to be efficient, connected and sustainable in a degraded global economic context.

The emergence of new technologies (Internet of Things, Big Data, Robotic Process Automation etc.) within ports has brought to light a new concept making it possible to respond to the failures described above: the Smart Port. The concept of Smart Port aims to make the port a place of collective intelligence capable of using technology to respond to interconnection and automation issues. The interconnection of the various players in the logistics value chain thanks to, for example, a predictive information system, the cloud and cybersecurity makes it possible to take the port into a new dimension. In addition, the automation of infrastructure but also port operations (customs, taxes, etc.) via the IoT or connected containers offer new opportunities for differentiation in the very competitive context of African ports. These innovations make it possible to meet the challenges of efficiency and traceability but also to reduce the processing times for goods and transactions, reduce handling costs which are up to six times higher in Africa than in Europe and thus improve the performance of the entire supply chain.

Take the example of customs procedures and payments for handling operations: these procedures are easy to automate thanks in particular to the cloud or RPA. In addition, these systems provide transparency for all port stakeholders, a reduction in costs and processing time and allow the authorities to focus on analyzes with greater added value. Bolloré has thus implemented an electronic payment solution at the Dakar terminal in order to reduce costs and delays and simplify administrative processes.

Smart Port solutions and new technologies also integrate sustainable development strategies. Indeed, renewable energies are entering the ports in order to reduce the negative externalities on the city. African ports are certainly a source of wealth for the surrounding cities but also of pollution and inconvenience for the inhabitants. Air pollution caused by ships at berth, the eddies of comings and goings in the estuary and their impact on fauna and flora are all issues to be taken into account in the ports of tomorrow. In this sense, technological innovations allow the reduction of the harmful effects of industrial activities; the Port of Montreal has implemented a digital tool for measuring, weighing and categorizing waste on board ships in order to centralize and facilitate recycling once the garbage has been unloaded at the dock. European ports like Rotterdam are going even further with real autonomous cleaning robots called “Waste Shark” and intended to rid the surface of the port waters of pollutants.

In the continuity of these initiatives, new energies are developing at quay and on ships: hydrogen and LNG are beginning to appear as fuel/means of combustion/means of propulsion. As proof of this real enthusiasm, in 2017 CMA CGM ordered nine LNG container ships with a record capacity of 22,000 containers. Ports must therefore adapt to receiving such ships by modifying their facilities. The Port of Los Angeles has therefore created power supply terminals to which ships at berth can connect in order to use this energy instead of their combustion engine for lighting or heating on board. Finally, to power these new innovative tools, Africa must take advantage of its potential in renewable energies, particularly solar. The installation of photovoltaic panels offers both energy at a competitive cost and requiring little infrastructure thanks to the direct proximity between the production and consumption sites.

Furthermore, the fluidification of traffic in and around the port is an essential development issue; the connection with the hinterland is often deficient and dry ports are lacking. As mentioned above, the efficiency of a logistics chain is measured at its weakest link; it is the latter which is the keystone of the rest of the mechanism. A fact well known to the inhabitants of large African metropolises is traffic congestion; this is all the more true near ports where trucks pile up and create huge traffic jams. These traffic difficulties are a real brake on the African economy and their financial impact is not negligible: the AfDB estimates the cost of congestion in Lagos at $19bn per year.

However, reasonable investments allow substantial gains, as shown by the creation of a car park with more than 400 spaces upstream of the port of Dakar and the establishment of an appointment system for drivers so that trucks do not arrive at the port only when their container is ready. Similarly, the port of Cotonou won the Gold IT Award in 2013 from the International Association of Ports and Harbors (IAPH): this award aims to reward the port authority for the implementation and successful operation of its port one-stop shop. This connected platform allows the rapid exchange of information, coupled with precise performance indicators and has led to the reduction of the transit time of goods. Finally, African ports must become multimodal hubs: the development of major road and rail axes, supplying both the coast and the sub-region with goods and merchandise, will allow the growth of the intra-African economy. Indeed, trade between African countries represents only 15% of all African foreign trade, the lowest percentage of all regions of the world, according to the United Nations Economic Commission for Africa (ECA). This necessarily involves major efforts by governments with territorial policies to open up access, certainly costly and long, but essential to the emergence of real African trade.

Although very short-term profitability is not the objective to be achieved, it is necessary that in the medium and long term, the investments made result in ports that support economic development and create value. The integration of ports in the development strategy of the countries concerned and taking into account the resources at their disposal is a first avenue to explore by promoting the use of specialized equipment for the goods marketed. The development of grain terminals, ore carriers, bulk carriers, etc. is therefore a trend to continue. The implementation of integrated infrastructures such as railway lines connecting the mines to the terminal is likely to promote the dynamism of this sector, such as the Sishen-Saldanha line which connects the Sishen iron mines to the southern port. from Saldanha on the Indian Ocean. Indeed, even if in the short term the economic prospects seem degraded, the combination of demographic, technological and geopolitical factors should support the growth of Africa's share in world trade and specialized ports are called upon to play a leading role. plan in this dynamic.

Legal stability is a prerequisite for the development of the African port sector. However, legal instability is often singled out by private operators in the port sector in Africa. In Cameroon, the termination of the container terminal concession agreement signed with the Bolloré Africa Logistics group after fifteen years of operation is an example where legal certainty does not seem to have been ensured. One way to reduce this perception of instability would be to make port regulators independent. However, regulation is often the work of a state entity, which gives rise to conflicts of interest, since the port authority is called upon to be judge and jury. South Africa is one of the few countries to have, through its National Ports Authority Act, adopted an independent port regulator.

Institutional reforms would accelerate the modernization of African ports. In particular, the port management models deserve to be reviewed in order to gain in efficiency. The proprietary port model is now widely considered to be the most appropriate institutional framework. The superstructures, equipment and operations are financed and managed by the private company while the infrastructures are the property of the public port authority. In this context, the development of the economic fabric is essential: the private operator must be fully committed to the creation of value and business at the local level, by applying, for example, affordable entry fees for businesses in the region. This management formula makes it possible to distribute investments, risks and benefits clearly between the different parties. However, local authorities should not absolve themselves of all forms of responsibility; on the contrary, they must pay particular attention, via performance indicators in particular, to the management and efficiency of the port. Gabon has thus contractually committed Arise, a subsidiary of the Singaporean group Olam, in order to reduce logistics costs for Gabonese companies and allow them better access to the market.

Like major European ports such as Le Havre or Rotterdam, African ports must create public-private ecosystems within them. To federate the different players, the port authority must promote a knowledge economy in order to encourage closer ties between port players and companies far from the port on the one hand and schools, universities and researchers on the other. Smart Ports provide higher education and business players with the resources to turn ideas into projects applicable to the port. Thus, the partnership between the port authority of Le Havre and the University of Le Havre Normandy has made it possible to develop several innovative solutions such as drones, even leading to patent filings.

Finally, the sharing of experience and increased cooperation at the continental level are levers that should be used more to promote productivity gains. As indicated during the Technical Committees of the West and Central African Ports Management Association (AGPAOC) in March 2020 in Douala, African ports have the “need (…) to adapt to new strategies shipowners, characterized by the gigantism of the ships, the reduction in the number of ship connections in the ports and the significant increase in the volumes on board which results from this. ". For example, Morocco and Côte d'Ivoire have signed an agreement governing a project to develop a logistics platform for the marketing of fruit and vegetables at the Port of Abidjan. This type of agreement is likely to better enhance the flows exchanged and allow the transfer of knowledge and experience between the two countries.

Bodies such as AGPAOC must be used more in order to implement a continental strategy and coordinate port initiatives to avoid duplication. This would make it possible to rationalize extension projects and send positive signals to investors on the coherence of port projects and their sustainability.

About the authors

• Jean Laurent Pyndiah is a Transaction Services consultant at EY France and a graduate in economics.
• Amin Benzekri is a consultant in digital strategy, graduated from the engineering school of Arts & Métiers ParisTech.