Administrative roadblocks stymie trade growth

Massive growth in Copperbelt volumes

Trade with Zambia and the Democratic Republic of Congo (DRC) continues to be hampered by red tape, according to Dhiren Krishna, managing director of Durban-based GSF Trucking. The company has first-hand experience of the challenges both

of moving cargo across the region’s borders and of investing in Zambia. “The regulatory framework in Zambia makes business registration, direct investment (property, plant and equipment) and forex transactions by foreign nationals somewhat complicated, risky and tricky.

“This is further compounded by the complexity of raising capital finance by foreign nationals or business entities (in Zambia itself or in South Africa for investment in Zambia) and insufficient capacity in state institutions such as the dti to assist and facilitate the growth of the SA road transport sector in Zambia. “The SADC regional governments need to come to the party by committing to increasing infrastructure capacity and efficiency at ports and borders, not neglecting the regional road infrastructure, and streamlining the legislative framework to make crossborder investment and security of tenure easier and attractive to allow us to invest regionally and take advantage of the growth opportunities on hand,” he says.

For shippers, the largest single challenge is “not in finding a road freight partner with the tonnage capacity, but a partner that can offer the tonnage capacity with full, around-the-clock operational and fleet support services two to three countries away.

“Fleet support is key with the huge distances covered, crossing up to six borders over a multitude of routes across an entire region,” he says.

This article first appeared in Freight & Trading Weekly magazine in the August 2018 Zambia edition. 

Massive growth in Copperbelt volumes

GSF - Slider 1
GSF - Slider 1

Massive growth in Copperbelt volumes

Freight volumes to and from the Copperbelt are growing almost three times faster than those within South Africa – pointing to stronger growth in Zambia and the Democratic Republic of Congo, says Dhiren Krishna, managing director of Durban-based GSF Trucking.

“As a result, we have allocated 40% of fleet expansion (through new fleet acquisition) over the next three years to Zambia/DRC. We foresee these two countries (particularly the Copperbelt region) making up about 30%-35% of our cross-border capacity,” he told FTW.

There is growth in both export and import volumes to the DRC and Zambia. “We attribute this to economic growth in both countries, with mining and resources driving exports and consumer demand driving imports.”

GSF Trucking currently hauls an average of 1 000 tons per month to Zambia and 450 tons per month to DRC.

 

About GSF

The company is investing in the Copperbelt in order to support the growth.

“We now have two designated operations personnel (apart from fleet control) who ensure smooth transit of cargo, including driver rest and fuel stops, border crossings, customer liaison, fleet support (tyres/breakdowns), documentation and the other aspects of multi-country, multiborder operations,” says Krishna.

The company is able to balance its loads. “Our first foray into Zambia was imports of containerised and breakbulk cargo to Lusaka and then to the Zambian Copperbelt, with an unprofitable empty leg back to Zimbabwe, where we already had an established client base, to load back to SA.

“Once we demonstrated our capacity and commitment to the Zambian run to our customers, volumes grew and we began handling exports from Zambia as well.

GSF Trucking is in the process of leasing offices and workshop/ yard space in Zambia, and expects to increase its team to around eight people.

“We have committed R2 million to expansion into the sub-region. We are investing in personnel, two new fleet support vehicles, and tyres and spares stores on our premises, which will include a full administration office,” he says.

This article first appeared in Freight & Trading Weekly magazine in the August 2018 Zambia edition. 

“With an established presence in Zambia and the southern DRC, we are now looking forward to increasing service range by offering refrigerated cargo services, abnormal cargo services and turnkey project management services (vessel to door) to these countries as well,” he says.

Zambia jumps up “Ease of Doing Business” rankings

GSF Trucks - Load
GSF Trucks - Load

Zambia jumps up “Ease of Doing Business” rankings

Zambia has moved up three places in the World Bank Ease of Doing Business index – from 98th in the world to 95th. It is now the sixth-easiest place to do business in Africa – after Mauritius (25th globally), Rwanda (41st), Kenya (80th), Botswana (81st) and South Africa (82nd).

This follows a dramatic drop between 2016 and 2017, where the country dropped on every measure.

In 2016 it ranked 94thglobally on the Index. Logistically, the country has improved from 161stglobally in the “Trading Across Borders” category to 150th.

About GSF

The ranking improved after the implementation of the web-based customs data management platform ASYCUDA World, according to the World Bank report.

Other areas in which Zambia introduced positive reforms were:

Getting Credit: Zambia strengthened access to credit by introducing a new Movable Property Act and by setting up a new collateral registry. The new law implemented a functional secured transactions system. The collateral registry is operational, unified geographically, searchable by a debtor’s unique identifier, modern, and notice based.

Paying Taxes: Zambia made paying taxes easier by introducing an online platform for filing and paying taxes. Paying taxes was also made less costly through a reduction of the property transfer tax rate.

This article first appeared in Freight & Trading Weekly magazine in the August 2018 Zambia edition.