Zambia intends to utilise its central geographic location in the Southern African Development Community (SADC) to unlock its potential as a key transport corridor.

According to Minister of Transport and Logistics, Frank Tayali the region presents an opportunity for the country to be exposed to multiple import and export trade and transport corridors.

Tayali made the remarks while attending the 2023 World Bank Group-International Monetary Fund Spring Meetings in Washington, D.C., USA.

He said the transport corridors that Zambia has among them; Dar-es-Salaam Corridor linking the Democratic Republic of Congo and Zambia’s Copperbelt Province, the North South Corridor linking Durban with DRC/Zambia via Zimbabwe and Botswana with a spur into Malawi via Harare, the Lobito Corridor connecting Zambia to the Democratic Republic of Congo and the Republic of Angola to the Port of Lobito on the Atlantic Ocean for Western import and export markets in the United States of America and Europe.

“The Nacala Corridor linking Zambia and Malawi to the Nacala Part in Mozambiaque which is one of the deepest port in SADC; The Beira Corridor linking large parts of Zambia, Malawi, Zimbabwe and Mozambique to the port of Beira on the Indian Ocean; and the Walvis Bay Ndola Lubumbashi Development Corridor (WBNLDC) links the Port of Walvis Bay with Zambia, the Democratic Republic of Congo and Zimbabwe.

“This route links Zambia to strategic outlet to export markets and offers a key route to the sea port on the Atlantic Ocean linking the mining companies on the Copperbelt and Northwestern Provinces of Zambia to the Western markets in the United States of America and Europe,” said Tayali, attending an event under the banner: ‘Unlocking Financing Opportunities and Development Potential of Key Corridors in Africa.

He said economic and transport corridors are critical for the development of nations.

“This is especially the case for land locked countries that need to access inputs for production or regional and global markets.”

The Minister further told the meeting that countries need to start engaging to actualize the benefits of the corridors.

“Countries need to start engaging more and more. For Zambia, President Hichilema has continued to promote economic diplomacy. During his last visit to Mozambique, the two countries announced that they will start having direct flights from Mozambique to Lusaka, Zambia. This is what we need. We need to actualize these corridors,” he said.

Tayali said there is a need to unlock the capital needed to realize the full development potential of key corridors as important trade routes for both economic growth and food security in Southern Africa.

The latest global Logistics Performance Index (LPI) released by the World Bank has rated South Africa, Egypt, Benin, Botswana, Namibia, Djibouti and Rwanda better than Nigeria

The LPI is an interactive bench-marking tool created to help countries identify the challenges and opportunities on trade logistics, including shipping and what they can do to improve their performance.

The LPI report, titled “Connecting to Compete 2023: Trade Logistics in an Uncertain Global Economy,” provides a measure of countries’ ability to move goods across borders with speed and reliability, the report is coming after three years of unprecedented supply chain disruptions during the COVID-19 pandemic, with soaring delivery times.

The LPI 2023 report revealed that end-to-end supply chain digitalisation, especially in emerging economies, is allowing countries to shorten port delays by up to 70 per cent compared to those in developed countries. Moreover, demand for green logistics is rising, with 75 percent of shippers looking for environmentally friendly options when exporting to high-income countries.

However, the report also noted that most time is spent in shipping, adding that the biggest delays occur at seaports, airports, and multimodal facilities.

It pointed out that policies targeting these facilities can help improve reliability, including improving clearance processes and investing in infrastructure, adopting digital technologies, and incentivising environmentally sustainable logistics by shifting to less carbon-intensive freight modes and more energy-efficient warehousing.

On average across all potential trade routes, 44 days elapse from the time a container enters the port of the exporting country until it leaves the destination port, with a standard deviation of 10.5 days.

That span represents 60 per cent of the time it takes to trade goods internationally.

The LPI report provides valuable information for policymakers and stakeholders involved in the logistics industry. It helps identify areas where countries can improve their logistics performance, thereby enhancing their competitiveness in the global marketplace.

Covering 139 countries, the LPI measured the ease of establishing reliable supply chain connections and the structural factors that make it possible, such as the quality of logistics services, trade, transport-related infrastructure, and border controls.

The report, which is based on a maximum score of 5.0, adjudged South Africa as the best in Africa and 19th in the world with a score of 3.4 per cent, followed by Botswana and Egypt which scored 3.1 per cent each to place a joint 57th position globally.

Giving an insight into the report, the World Bank revealed that the survey was conducted between September 6 and November 5, 2022 and contains 4,090 country assessments by 652 logistics professionals in 115 countries across all World Bank regions.

Logistics volumes into and out of Zambia have grown consistently over the last ten years, with the bulk of cargo movement being driven by capital expenditure projects for mines, growing mining sector activity leading to increased distribution to key markets such as India and China, and infrastructure development.

However, DSV Zambia MD Kris van Heerden said despite the infrastructure improvements, the road and rail infrastructure could not meet existing demand let alone forecast growth – and this hinted at the opportunities in the country once infrastructure matched economic potential.

Transport’s contribution to GDP has grown, if unevenly, over the last ten years shows, as the graph below shows, and it reached a high of 1678.50 ZMW (Zambian Kwacha) in the third quarter of 2021, before falling to 1459 ZMW Million in the fourth quarter of 2021 – but still recording the highest fourth quarter of the decade.

The rising price of copper over the past 18 months and the relaxing of tax liabilities by government for mines had positively impacted mining production and led to increased exports. “At the same time, mines were investing in increasing production capacity, and this automatically impacted on inbound cargo flow within Zambia for capex investments of the mines.”

Van Heerden pointed to First Quantum Minerals, which was investing US$1.2 billion to boost productions of copper and nickel for export, as evidence of growing investor confidence in the country’s mining sector and positive reaction to the government’s Economy Recovery Programme.

The Zambian economy was projected to grow 2.0% in 2022, underpinned by recovery in the mining, tourism, and manufacturing sectors, all of which are fueling demand for logistics services.  Van Heerden said DSV Zambia was active in the Automotive, healthcare and Pharma, Energy and Mining + Projects verticals.

Van Heerden said there had been improvements in many parts of the country and government had both recognized the importance of the transport sector to the economy and was committed to entering public private partnerships as a route to maintaining and constructing transport infrastructure.

Both Kenneth Kaunda and Simon Mwansa Kapwepwe International airports were upgraded to international standards in 2021, and there have been improvements to both road and rail networks.

The Lusaka Decongest Project, which included construction, rehabilitation, and expansion of roads, has reduced travel times in the capital.

“Importantly, the recently opened 923-meter Kazungula bridge linking Botswana and Zambia over the Zambesi River, along with one-stop border posts on each side, has made regional trade that much easier, providing alternative routes for SADC movements into, out of and through Zambia.  Roads were being rehabilitated and upgraded and new roads built to improve trade corridors between mines, cities, towns and rural areas and neighboring countries”, he said.

In addition to this infrastructure development, the Zambia Revenue Authority (ZRA) had introduced, including the two international airports, and the Kitwe, Chirundu, Kazungula, Nakonde and Katimo border posts.

The implementation of compulsory pre-clearance at all the borders has ensured that goods move seamlessly into Zambia.

The Zambia Revenue Authority has also introduced the Customs Accredited Client Programme (CACP) which facilitates almost “risk free” movement into Zambia once clients have been fully audited and accredited by the ZRA.

DSV Zambia is part of DSV – Global Transport and Logistics, which manages supply chain solutions for companies from 90 countries and has been operating in Zambia for 30 years.