Investing in Transportation - High risk, big returns, a noticeable absence
When I was a teacher in Uganda in the early 1970s, I would travel the 200-mile distance from Kampala, the capital, to Fort Portal near the Congolese border by bus, and then take a taxi for another 10 miles or so to the school. The most direct route from Kampala to Fort Portal was via the town of Mubende, so I would take the Mubende bus early in the morning and hope to arrive in Fort Portal about six hours later. Invariably, however, the overcrowded bus would break down and we would idle–men, women, children, live fowl, a goat or two, and produce—for hours beside the potholed, dusty red road until another bus came along, or the driver or a mechanic from the nearest village got the bus going again. Once in a while we would have to push the bus to give it a jump start. I soon got wise and started taking the Mbarara bus, which took a much longer, but blessedly paved, route.
I thought of those days when a delegation of high-ranking maritime officials from Africa came to town in July—11 of them, from Angola, Cameroon, Cape Verde, Ghana, Guinea (Conakry), Nigeria, Sao Tome and Principe, Senegal, and Togo. Their 10-day visit, underwritten by the U.S. Trade Development Agency (TDA), exposed them to the infrastructure and operations of ports in New York, Minnesota and Texas. They met with shipping operators, suppliers and service providers to discuss projects in their home countries and to explore possibilities for business partnerships.
How did their visit relate to my Kampala-Fort Portal trek? They were concerned about transportation—moving people and commodities from point A to point B. Transportation can make or break a nation’s economy. In Africa, where more than 95 percent of the goods traded between the continent and the rest of the world moves on ships, and where that trade is growing at double-digit rates annually, the maritime sector is wide open for capacity-building investment. Foreign, and increasingly local, investors are jumping at the opportunity. Transportation infrastructure is a high risk but very lucrative investment.
Ecomarine International, in Togo, wants to increase the number of smaller vessels that can use the ports along the continent’s west coast. The company is the first indigenous privately owned marine operator in the region. “We are looking to put up a shipping line to serve as a feeder service to the deep-sea lines and also to bring the most cost-effective mode of transportation to the region for interregional trade,” William Chindo, Ecomarine’s general manager of business development and one of the 11 delegates, told me during a reception at Sylvia’s Restaurant in Harlem. “Right now we’re operating via chartered vessels, but we want to own vessels because it is not cost-effective to charter,” he said.
Another delegate, Zacchaeus M. Forjindam, general manager of Cameroon Shipyard & Industrial Engineering Ltd., said he needed help to build housing for port staff. “We’re developing a ship repair facility and we need 3,000 housing units to support the social component of that project. We’re also developing a state-of-the-art deep-sea port to support the latest generation of [big] ships. It’s a $500 million project,” he told me.
Another delegate, Bara Sady, director-general of the Port of Dakar Authority in Senegal, said, “We’re executing the development of the container port and the dry port. We have spent a lot of money for security. We need help to obtain equipment for a rescue center that we have built inside the port itself.” The rescue center would be the first of its kind in West Africa and would be critical in handling environmental, fire, sea defense and other challenges throughout the region, he explained.
In South Africa, a Black-owned shipping line has stepped into the largely foreign-dominated industry. The owners of South African Liner Container Services, as the shipping line is called, are mostly former inmates of Robben Island, where Nelson Mandela and other anti-apartheid activists were imprisoned.
Among U.S. investors, Transrail Solutions Inc., of Jacksonville, Fla., operates the Senegalese rail system; Seaboard Corp., an agribusiness and ocean transport company in Shawnee Mission, Kan., runs commodity-laden ships along the west African coast; and a consortium led by Pittsburgh-based Railway Development Corp. has been working since 1997 to create the first integrated port-railway transportation system that will link landlocked Malawi and Zambia to the port of Nacala in Mozambique. In addition, TDA, the Overseas Private Investment Corp. and the Agency for International Development, all federal agencies, are pumping millions of dollars of support into port capacity enhancement projects.
In this bubbling investment scene, the presence of African-Americans, whose collective buying power is almost a trillion dollars, is sadly lacking.
By Rosalind McLymont