South Africa: Dube TradePort strengthens regional supply chain

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Dube TradePort is taking advantage of its prime location beside Durban on the South African coastline in a bid to become Africa’s first aerotropolis, connecting business, people and goods to global markets.

Upon completion, this airfreight and passenger hub surrounded by industrial and agricultural zones aims to be the continent’s only facility combining an international airport, dedicated cargo terminal, warehousing, offices, retail, hotels and agriculture. The ultimate aim to is develop Durban into a major logistics gateway, acting as a seamless road, rail, air and sea platform to serve the subcontinent.

“The backbone of South Africa’s economy relies heavily on transport for the movement of our natural resources,” says Hamish Erskine, chief executive officer of Dube TradePort Corporation, which manages the project. “By investing in transport infrastructure, South Africa is creating efficiencies in its logistics and supply chain management systems, which improve overall competitiveness and the cost of doing business, all in a coordinated effort to spur sustained economic growth.”

Occupying a 2,840-hectare greenfield site, 30km north of Durban, Dube TradePort is strategically located between South Africa’s two primary seaports – Durban, the country’s busiest cargo port, and Richard’s Bay – while abutting major road and rail links. The hope is that this global trading platform, being developed by the KwaZulu-Natal provincial government as the province’s biggest infrastructural project, can transform the region into a noteworthy player within the global supply chain.

“Dube TradePort forms a central part of the economic growth plans for the province of KwaZuluNatal,” Erskine says. “Responsibilities go far beyond providing an integrated manufacturing base for attracting investment, by also stimulating the production of the high-value perishables sector and driving the growth of a world-class local cloud computing business in addition to playing a role in attracting new international air services to Durban.”

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Government incentives Dube TradePort was designated as an industrial development zone in July 2014, a prestigious status that links it to prioritised government strategy while carrying a range of fiscal benefits for enterprises in the zone. It has now been declared a special economic zone, further boosting the incentives for domestic and foreign direct investment in its value-added and export-orientated manufacturing industries and services.

Dube TradeZone is the first airport-related trade zone in the world where freight forwarders and shippers are located within a single facility. It wants to attract high-tech aerospace services, electronic manufacturing, automotive industries, pharmaceuticals, clothing, textiles and cold-storage activities.

“Companies [already here] range from large multinationals like Samsung Electronics, who are producing televisions and monitors, to Cipla BioTec, who will be manufacturing biopharmaceuticals for the treatment of cancer and autoimmune diseases, as well as mid-size companies who have moved production back to South Africa from China,” Erskine says.

Dube Cargo Terminal, directly linked to freight forwarders in Dube TradeZone via an elevated conveyer system, claims a 0% cargo loss since it began in 2010. It is currently capable of rapidly handling 100,000 tonnes of cargo annually, set to increase to 2m by 2060.

Dube AgriZone is Africa’s first integrated perishables supply chain, hosting the continent’s largest climate-controlled growing area under glass. An agricultural business model with an eye on the future, it incorporates a mix of tenants and infrastructure from specialised tissue culture laboratories to greenhouses and packhouses.

Meanwhile, Dube City is positioning itself as a cosmopolitan centre adjacent to the airport, offering mixed land use, including office, hotel, conference, entertainment, retails and knowledge-intensive activities.

Hampered progress

The 3.7km runway of King Shaka International Airport is currently capable of carrying 7.2m passengers per annum, expected to rise to 45m by 2060 as Dube TradePort expands around it, including road and rail links extending to Durban’s harbour.

But Dube TradePort’s progress has been hampered by air-cargo volumes remaining relatively low because of the small number of international flights in and out of the airport. OR Tambo International in Johannesburg still dominates, with cargo then trucked to Durban.

Dube TradePort has also previously been rocked by managerial corruption and criticised as a loss-making, government-mangled white elephant. But the last two years have provided reasons for confidence that this state-of-the-art air-cargo facility can go beyond all that.

“We have seen Dube TradePort, together with the local government, work to attract new airlines flying directly to Durban,” says Ricky Dos Santos of DHL Global Forwarding South Africa. “With the increase in both regional and international air serves directly to and from Durban, Dube TradePort brings efficiency and security to the regional supply chain, which is especially relevant for time sensitive and high-value consignments.”

Another encouraging sign is that demand for industrial space exceeded the sites available during the project’s 26-hectare first phase, with occupancy levels reaching 100%. As a result, the second phase, involving another 50 hectares, was brought forward to make additional sites available in 2017.

Regaining ground

Dube TradePort’s lofty ambitions come at a time when South Africa’s previous regional gateway role is under increasing pressure. Some fear that its neighbours are replacing South Africa as the gateway to the other Southern African Development Community states. Others, however, are optimistic that Dube TradePort will enable South Africa to make up lost ground.

“Dube TradePort strengthens South Africa’s competitiveness by ensuring that the KwaZulu-Natal Province has increased regional air connectivity,” Dos Santos says. “For consolidators this is an advantage as it enables them to offer a direct service to and from Durban to worldwide destinations and origins.”

Already Dube Cargo Terminal handles automotive goods, fashion items, electronic goods, pharmaceutical products and components for machinery entering the continent by routes through Ethiopia, Zimbabwe, Botswana, Namibia, Zambia, Mozambique and Mauritius.

“These producers and logistics organisations are taking advantage of Dube TradePort’s unique location, which boasts modern road, rail, sea and air connectivity as well as the ready supply of services and strong institutions,” Erskine says. “All of these factors make Dube TradePort an ideal launchpad into the rest of the African market.”

James Jeffrey

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