Transport

On the Beaten Track

Transport

AIR Mozambique has aspirations to become a regional air transport hub in the future, possibly even reaching further afield. It is located in a promising position close to neighboring South […]

AIR

Mozambique has aspirations to become a regional air transport hub in the future, possibly even reaching further afield. It is located in a promising position close to neighboring South Africa and hopes to use its new international airports as its main attractions to bring in new passengers. Set for completion in June 2014, the Nacala International Airport in Nampula will add a further 500,000 passengers to national capacity. The airport has cost an estimated $114 million thus far and has been built on a former Portuguese airbase. It is located close to the Port of Nacala and is expected to attract investment and tourists to the northern territories of the country. The airport features a 3.4-kilometer runway, a single passenger and cargo terminal, 16 check-in desks, 16 immigration desks, four arrival and departure gates, and two departure lounges. Aeropuertos de Moçambique (ADM), set to operate the airport, believes that Nacala could become the international transport hub that the country hopes to establish over time. The ADM has split Mozambique into three sections: south, central, and north. Maputo International Airport has the south of the country covered, while Beira will cover central Mozambique. This leaves Nacala as the main domestic hub in the north. This is just the first component of the strategy, “we also have a regional strategy for the east coast of Africa, including Cairo, Addis Ababa, and Nairobi,” Emanuel Chaves, Chairman & CEO of ADM, explained to TBY. Between Nairobi and South Africa there is no effective hub. Dar es Salaam is too close to be an effective hub, which leaves Nacala in prime position to assume this role, being roughly two hours from both Nairobi and Johannesburg.

Shortly before the announcement of the new Nacala International Airport, a $75 million renovation of Maputo International Airport was announced to boost its annual capacity to 900,000 passengers from 300,000. The upgrade will fully modernize the airport to the highest environmental standards and featuring the most contemporary amenities. A further $420 million has been earmarked for the renovation and upgrade of Pemba and Tete airports, possibly as national and regional hubs, respectively.

Upgrading airports is practical, but of course there must first be a clear promise of arriving planes and passengers. This is why the government has been signing air transport agreements (ATAs) and memorandums of understanding (MoUs) with other countries to encourage travel. In 2010, Mozambique signed an ATA with Brazil to establish a link and increase trade. This was to establish an air link between the two capitals, as well as an additional bonus of mutually recognized driver’s licenses. In 2012, an ATA and a MoU were announced between Qatar and Mozambique, again with the aim of increasing trade and travel. The agreement allows unlimited passenger and cargo flights between the two countries where the two national carriers code share on flights.

ON THE ROAD

One area of Mozambique’s transportation matrix in urgent need of attention is the road network. With the exception of the major highways and throughways, the general condition of the road network is in a poor state of disrepair. It therefore needs investment to keep up with the increased demand for both commercial and personal use. There are slightly over 30,000 kilometers of roads in Mozambique, with around 20%, or 5,649 kilometers, being paved. Of that 20%, only around 67% is in what can be called a fair to good condition. However, there are a number of major ongoing projects, such as the Nacala Road Corridor development. Split into four phases, a 900-kilometer stretch of road is under construction connecting Mozambique, Malawi, and Zambia. Phase I consists of 348 kilometers in Mozambique and a 13 kilometer by-pass through Malawi. Phase II will run through Zambia, from Laungwa to Mwami. Phase III adds a further 160 kilometers in Mozambique and 152 kilometers of road in Malawi. And finally, Phase IV consists of the rehabilitation of 75 kilometers of road between Liwonde and Mangochi in Malawi and the establishment of border crossings on the Malawi-Mozambique and Malawi-Zambia borders, respectively. The project is currently moving into Phase IV with the African Development Fund issuing a $65 million loan to the project. In addition to this, the Beira-Zimbabwe highway is set for a redevelopment to the turn of $400 million. The money will be loaned from the Chinese Export-Import Bank (Exim Bank) and will fully rehabilitate the road between the Port of Beira and the border town of Machipanda.

THOUGHT OF TRAIN

One of the most important links for the mining sector is the rail system. It is used to connect the major mining and agricultural hubs to Mozambique’s ports and neighboring countries. The current network stretches for 3,123 kilometers with a large amount of it under renovation to increase it capacity. There are three main corridors in Mozambique. The Nacala railroad links the Nacala Development Corridor to the East African Railway. The second major corridor is the Beira railroad, which links Beira to Harare, and the final corridor is the Maputo railroad, which links Mozambique with South Africa, Swaziland, and again Zimbabwe. The railroad is adequate for most needs and has been attracting foreign investment; however, the quantity of coal being produced exceeds the current capacity of the network, which is causing a headache for companies wishing to export large volumes of minerals. Due to the poor network of roads and its inefficient manner of transporting coal, private interest in upgrading the rail network is high. Vale has been one of the major investors in Mozambique, and is spending a total of $4.5 billion developing the Nacala Corridor. When completed, the corridor will have a capacity of 18 million tons per year of coal, which should be able to cope with Vale’s Moatize Mine and its capacity of 11 million tons per year.

FLOATING THE EXPORTS

While the rail network shunts the bulk of the coal domestically, when it comes to exports the port is king. Indeed, the major developments on the rail network are focused on improving links to the country’s ports. On the East Coast of Africa, Mozambique has access to all the major markets of Asia, as well as North East Africa and the Middle East. It is therefore in a prime position to export across the sea, as it is only a short trip round the Cape Horn to West Africa. These advantages are one of the reasons why companies in Mozambique have been investing in the development of its ports. Grindrod, Africa’s largest shipping company, announced in April 2013 that it would spearhead the development of a number of the country’s most used ports. It plans to invest $1.7 billion over the next five years to upgrade the ports of Maputo and Matola. The intention is for these two ports to have a capacity of 50 million tons by 2020, a significant increase on its current 15 million. This investment will also be made in partnership with the Maputo Port Development Company (MPDC).

In total, the Mozambican government is estimated to require $5 billion to meet the coal industry’s demand for rail and port infrastructure. In December 2013, the government selected Italian-Thai Development Plc. to construct a 525-kilometer rail line from Tete to Macuse, as well as a port capable of handling 25 million tons of cargo per year. This project is forecast to approach completion by around 2016, and should significantly ease the current export bottleneck.

The government of Mozambique is diligently seeking to attract investment for the development of its transport infrastructure. It knows that once the country is able to handle the demand for rail and export services, it will be able to concentrate on other areas of interest, while reaping the rewards of a successful coal industry.

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