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Tue 12 Feb 2008 04:00 AM

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Opportunity rains down in Africa

Africa's status as a leading international hub for the logistics industry has received a massive boost in recent months.

Africa's status as a leading international hub for the logistics industry has received a massive boost in recent months, with the continent attracting a steady flow of investment from all quarters of the world.

In particular, the Middle East has displayed an unshakable confidence in the emerging market by announcing a number of ambitious logistics projects in promising trade centres such as Kenya, Tanzania, Mozambique, Rwanda and South Africa.

Perhaps Sultan Ahmed bin Sulayem, chairman of Dubai World, best described the scenario when he told journalists that "the opportunities currently found in Africa cannot be found anywhere else in the world, but you have to physically be there to capitalise on the market".

Dubai World isn't simply talking the talk either; it has already pumped millions of dollars into projects throughout Africa, with the most recent example being a massive US$32 million investment through DP World in the growing Mozambique port of Maputo. In addition, it has assigned a dedicated team of experts to analyse the continent's most lucrative market opportunities, with a series of further investments expected in 2008.

However, whilst Dubai World should undoubtedly be congratulated for its proactive stance, this issue of Logistics Middle East is literally crammed with further examples of the Middle East's budding relationship with Africa.

Our cover story on the recently launched pharmaceutical specialist Pharma World includes details on the logistics company's plans to build a network of warehouses in countries such as Eygpt. Furthermore, our indepth article on the transportation of perishables is evidence that forward thinking companies such as Issa Baluch's Swift Freight International have already established a solid position within the African logistics industry.

Finally, in the news pages, we show how regional powerhouse Agility boosted its North African presence in December 2007 through the acquisition of Medorient Algeria, which was followed more recently by the acquisition of Kenyan company Starfreight Logistics Limited.

Whilst these developments are undoubtedly exciting, a number of hurdles need to be overcome by Africa to truly establish itself as a logistics superhub, much like the Middle East has done over the past five years. For starters, the transportation infrastructure needs significant investments to help pave the way for improved transportation flows. This needs to be complimented by business-friendly incentives for international companies to commence operations in the continent.

However, most importantly, the political turmoil that the continent has faced in recent months could potentially deter investors and ultimately ruin the logistical momentum that is currently underway.

In Kenya, for example, the political crisis has directly impacted the country's logistics activities, with the Uganda Export Promotion Board (UEPB) indicating that exporters trading in coffee, flowers and seafood will lose millions of dollars from the country's transportation slowdown, particularly in leading ports such as Mombasa.

Such stories can have a detrimental effect in both the short and long term, but hopefully Africa has the will to overcome these unfortunate circumstances and persevere in its logistical ambitions.

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