Is mining still a significant sector for logistics companies?
Yes that is quite true for Zambia. Logistics and transport companies are often heavily mining orientated because that is where volumes come from. In the mining sector, there are many local contractors, representing global brands, who rely on logistics advice to make a difference. We consult with them not only on transports and supply chain cost analysis, but also on customs formalities that go beyond clearing goods in and out of the country—how to manage customs risks, temporary import validities, how to optimize the use of bonded warehouses, and so on. But we also recognize different needs from our other Zambian customers: we have invested in value-added warehousing activities and geared ourselves to diversify our portfolio of customers. We have also developed a successful export business focusing on agricultural products and industrial commodities. Export companies seek deals in the region with DRC, Malawi, Eastern Congo, Burundi, and Rwanda, as well as to far-flung markets. We have solutions to export to all those places.
What is the thinking behind the Chingola hub?
Our logistics hub in Chingola was set up specifically to answer the needs of the Katanga mining business. It is a business geared around the movement of copper and cobalt, extracted from the DRC, crossing the border of Kasumbalesa, offloading in Chingola before sorting and dispatching along the Durban, Dar, or Beira corridors. The transport of these goods is a complex and sensitive process, and it was vital to set up a hub in the right location. Chingola, located in the Copperbelt, close to the Kasumbalesa border, is the ideal location. It is located next to our White Horse premises and is the meeting point for two fleets of trucks operating simultaneously—one carrying copper and other minerals from the Katanga province in the DRC and the other bringing supplies and consumables from South Africa. Cargo is transferred in our 18,000sqm secure warehouse facility.
In terms of logistics, what measures would you like to see implemented by the government in the medium term to boost the sector?
On a practical level, we need to work on improving border management and alleviating congestion at the borders. For this, first we need to fix the root cause of congestion. There are issues related to this; for example, of ISPs not being able to provide enough internet capacity to support customs' "paperless" system, Asycuda World. If customs wants to have an entry registered in one place and have it electronically assessed in another, it needs strong connectivity. We have engaged both customs and the Ministry of Finance through our Association of Clearing and Forwarding Agents (ZCFAA) and made proposals to streamline operations. In response, customs and the Minister of Finance have set up technical committees to oversee the progress of propositions made. Elsewhere, we see a stronger and more regulation-heavy approach from the Ministry of Transport, which recently introduced a measure to prevent trucks from driving at night and intends to impose a quota system for transport of bulk material on rail.
Does Zambia have the potential to become a logistics hub for southeastern Africa?
Given its geography, Zambia can play a vital role in the region as a transit zone for goods. However, to fulfill this potential, it is vital that all measures and regulations are carefully thought through and designed to facilitate movement of cargo. One such area that needs to be looked at is VAT on transit cargo. Transit cargo should not attract VAT, and in operations where we perform transit services in Zambia, it is essential that ancillary services on transit cargo also do not carry VAT. Otherwise, this would add unnecessary costs and make it less attractive for shippers and contractors.