African air cargo market set to benefit from forwarder investments

It is hoped that recent investments by large forwarders in Africa will lead to infrastructure improvements.

In January this year, DHL expanded its capabilities in South Africa by investing in new 10,000 m sq warehouse with pharma facilities near Johannesburg Airport.

Also in January, CEVA Logistics acquired Moroccan freight forwarder ASTI Group.

In December, CEVA also took a majority stake in Egypt-based IBA Freight Services, as well as a minority stake in Ethiopia-based MACCFA.

In the same month, DSV started the acquisition of Globeflight Worldwide Express, a South Africa-based courier company.

Additionally, last summer, CEVA announced it had acquired a controlling shareholding in third-party logistics provider AMI Worldwide, which has a presence in 12 countries in east and southern Africa through its brands AMI and Manica.

Sanjeev Gadhia is the founder and chief executive of privately-owned, Kenya-headquartered cargo airline Astral Aviation, and a trustee and vice chairman at TIACA.

He says investment from forwarders will result in better and more secure infrastructure at airports – a key challenge currently faced by Africa-based carriers, which directly impacts air cargo.

“Large freight forwarders have big pockets,” he says. “They have a lot of financial resources – that’s something really need in Africa. They’re able to construct warehouse facilities and can invest in equipment like trucks.

He adds: “Forwarders are also investing in communities in Africa by employing local people and training them up.”

Ethiopian Airlines is directly benefitting from forwarders’ interest in Africa. The carrier has formed a joint venture with DHL that enables it to offer multimodal logistics services to its customers.

Fitsum Abadi, managing director of Ethiopian Cargo, says: “Africa is attracting all kinds of investments – agriculturally and industrially.

“There are a lot of industrial parks in Ethiopia – we have around 15. Logistics companies like DHL know that Africa will be a future high-yield market. That’s why they’re expanding here.”

In the April issue of Air Cargo News, find out how the African air cargo market is overcoming unique challenges in the region, as well as handling Covid-19 vaccine distribution.