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TRANSCRIPT
Transport Solution
26 /10 / 2010
www.nepadbusinessfoundation.org
Presentation Layout
• Global overview
• Infrastructure & Transport Challenges
• Elements of Vision 2025
• Investment option
• Strategy Benefit
• Critical Success factor
• Conclusion
Global Customer Requirements for Rail/Road
• Heightened pressure for world-class competitiveness
• Efficient rail is a competitive advantage for customers to get product to market – 5 “R’s” of Rail:
– Right Place
– Right Time
– Right Quantity
– Right Cost
– Right Condition
Rail/Road is an integral part of the total supply ch ainrail operators in Africa must think outside the box
• Traffic Congestion around ports• Missing links or connectivity• Poor trade partnership• Lack of Connectivity and integration with Ports• Lack of funds in financing • Poor infrastructure and Rolling stock• Lack of human development
Rail / Road and Port Issues
AFRICAKm railway lines per country
Total: 82.991 km. (35 countries - September 2007)
0
5 000
10 000
15 000
20 000
25 000SO
UTH
AFR
ICA
SUD
AN
D.R
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NG
O (Z
AIR
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YPT
ALG
ERIA
NIG
ERIA
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ZAM
BIQ
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TAN
ZAN
IAZI
MB
AB
WE
AN
GO
LAN
AM
IBIA
TUN
ISIA
K
ENYA
ZAM
BIA
MO
RO
CC
OU
GA
ND
AC
AM
ERO
ON
GH
AN
ASE
NEG
AL
R.O
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NG
OB
OTS
WA
NA
MA
DA
GA
SCA
RG
UIN
EAM
ALA
WI
MA
UR
ITA
NIA
ETH
IOPI
A
CO
TE D
'IVO
IRE
GA
BO
NM
ALI
BU
RK
INA
FA
SOTO
GO
BEN
INER
ITR
EASW
AZI
LAN
DD
JIB
OU
TI
Km
The railways
• 35 railway countries• 7,5% of the world total railway network
– 38% of narrow gauge
• China: 87.000• Russia: 75.000• India: 63.000
The world and the African market
• 20.4% of the total land area • 14% of the world population• Half of the worlds landlocked countries• More than 50 countries and several
regional organizations• Not homogenous
(development levels, opportunities etc)
Key Drivers Transportable GDP Growth
Economic Growth
Shifts in market flow
patterns
Containerisation
MarketLiberalisation
However, road has been the main beneficiaries of this growth
MarketAdaptation
MarketMarketAdaptationAdaptation
SkillsDevelopment
SkillsSkillsDevelopmentDevelopment
Policy Frameworks
Policy Policy FrameworksFrameworks
Private sectorparticipation
Private sectorPrivate sectorparticipationparticipation
Modal Co-operation
Modal Modal CoCo--operationoperation
OperationalEfficiency
OperationalOperationalEfficiencyEfficiency
RegionalInter-
connectivity
RegionalRegionalInterInter --
connectivityconnectivity
InvestmentInvestmentInvestment
Vision2025
Elements of an Africa 2025 Transport Vision:‘More Rail for Africa’
Focus area: Projects
1. Operations and Information Technology
2. Human Resources
3. Infrastructure and Equipment
4. Marketing
Private sector participation
• Socio-economic• Long term• ROI not purely financial• National / Strategic
Development• Funding and affordability
will always be a challenge
• Capacity typically lags demand
• Often lack skills
• Purely commercial• Reliance on anchor
commodities• Shorter term• Integrated rail system
sustainability not primary imperative
• Access to funds• Rapid development• Attracts skills and talent
PPP Strategic Issues to be considered by Vision 202 5• Impact of Rail Concessionning – future sustainability; corridor management; rail system integration;
need to separate infrastructure and operations• Pursue Opportunities for PPP’s - Wagon investment schemes, Intermodal Terminals, Outsourcing
non-core activities, Advanced Train Technology, Major Infrastructure Development
Strategic Benefits of PPP’s
Railways can achieve the following
• Re-investment in infrastructure and equipment
• Integration of activities and services
• Cooperation between railway companies
• Establishment of multi-modal supply chains and trans-
national railway corridors
Elements of Rail / Road Investment
Collaboration• Share real-time data with key customers,
suppliers and partners• Align individuals and organizations• Standardize processes and practices
Optimization• Implement new tools and processes
• Eliminate inefficiencies• Leverage cost savings across communities
Connectivity• Standardize applications and platforms
• Foster many-to-many collaboration• Enable trade exchange
Execution• Improve transportation, distribution,
inventory, and order management• Expedite financial settlements• Measure performance results
Speed• Increase responsiveness• Improve adaptability• Access information in real time
Visibility• Track inventory flow• Update order status in real time• Manage incidents
Freight Growth
Rail/Road has a role in Creating a ‘Seamless’ Supply Chain
A system of integrating logistics players and customers through a seamless process supported by a common technology platform
Rail
EmptyTruck
Port
LoadedTruck
Customer
TruckDepot
Offloads
Goods Loadedon Wagons &
Departs
Train Offloads at
port
Rail Terminal
Cargo on Vessel
Seamless process
Common Technology Platform
Customs
SADAC Benefit from Vision 2025
•Reliable, Safe, Sustainable Scheduled Railway
•Point to Point Service Delivery
•No frills, Low Cost and Efficient
•Focus on chosen corridors (SA and SADC)
•Enable Multiple Rail Operators
• Enable Feeder Line Concessions
• Relinquish marginal lines
Rail Industry Environment
Efficiency Performance
Mad
agas
car
Strategic Rail corridors in SADC
Strategic Corridors
East-WestConnectivity
Mal aw
i
Zambia
BotswanaNamibia
South Africa
Moz
ambi
que
United Republic of Tanzania
Democratic Republic of Congo
Zimbabwe
Angola
Swaziland
SADAC must focuses on integration of strategic
corridors through integrated rail operations with Southern African Railways to maximise
Infrastructure
SADAC must focuses on integration of strategic
corridors through integrated rail operations with Southern African Railways to maximise
Infrastructure
60% of Mineral Deposits in Southern Africa
60% of Mineral Deposits in Southern Africa
Ma la w
i
Zambia
Botswana
Namibia
South Africa
Moc
ambi
que
United Republic of Tanzania
Democratic Republic of Congo
Zimbabwe
Angola
Swaziland
Ma la w
i
Zambia
Botswana
Namibia
South Africa
Moc
ambi
que
United Republic of Tanzania
Democratic Republic of Congo
Zimbabwe
Angola
Swaziland
Mauritius
SADC Growth
GDP Growth2005 – 4.8; 2006 –
5.10Corridor Market
GDP Growth2005 – 7.0; 2006 – 7.0
Corridor MarketCopper, Sulphur &
Diesel
GDP Growth2005 - 6.5; 2006 – 7.0
Corridor MarketContainers
GDP Growth2005 – 7.3; 2006 – 6.5
Corridor MarketCoal, Sugar & Maize
GDP Growth2005 – 2.0; 2006 – 1.7
Corridor MarketAnthracite, Pulpwood
GDP Growth2005 – 5.0; 2006 – 5.0
Corridor MarketSulphuric Acid, Diesel,
Copper & Sugar
GDP Growth2005 – 4.2; 2006 – 3.5
Corridor MarketCement, Petrol,
Diesel, & Sodium Carbonite
GDP Growth2005 – -1.6; 2006 – 0
Corridor MarketFerrochrome, Coke,
granite, Petrol & Diesel
GDP Growth2005 – 13.5;2006 –
24.5Corridor Market
GDP Growth2005 – 3.6; 2006 – 3.8
Corridor MarketZinc, Cement & Maize
GDP Growth2005 – 4.0; 2006 – 3.5
Systemic Cost Reduction Model
CorridorDensity
CorridorDensityImproved Market
ShareImproved Market
Share
Efficient RailTrans. SystemEfficient Rail
Trans. System
Low operatingcost
Low operatingcost
Increased Traffic
Increased Traffic
Critical Success Factors
• Relationships with transport partners
• Readiness to form joint venture
• Involvement all key stakeholders
• Communication and sharing of
information
• Joint opportunity identification
• Dedicated project and team members.
Conclusion
• African Railways must have a commonvision to implement vision 2025
• Integrated and coordinated development
• Development, Attraction and Retention of Skills
• Infrastructure investment
• Rail resources are strategic – need to be nurtured to be sustainable
Thank you.Thank you.
Stanley MkokoStanley Mkoko
Transport Sector HeadTransport Sector Head
NEPAD Business FoundationNEPAD Business Foundation