Drop in logistics sector's contribution to economy
THE contribution of the country's logistics sector to the gross domestic product (GDP) dropped to N$17 billion in 2017 from N$18 billion recorded in 2016, statistics show.
This was revealed at the launch of the state of logistics report, compiled by the Walvis Bay Corridor Group (WBCG), which outlined that the sector's performance saw an overall score of roughly 3 out of 5, putting the country above 50% globally, from 2012 to 2018.
The report showed that Namibia's logistics sector recorded growth of 15% on average for 10 years up to 2017.
GDP, on the other hand, stood at N$109 billion and N$108 billion in 2016 and 2017, respectively. This comes after the Namibia Statistics Agency revealed that sectors such as wholesale trade, retail trade and road freight made relatively higher contributions to GDP than the logistics-related sectors.
The report further explained that Namibia's railway network transports approximately 1,58 million tonnes of cargo annually.
Speaking at the launch, transport minister John Mutorwa said logistics is the elevated priority for many countries, regardless of their level of economic development. This is because of the important role that the sector plays in stimulating economic activities and the social transformation of many nations.
He added that the sector is critical for the development of other sectors of the economy.
“We must continue to be smart, and offer the best services to those who are in need of them, lest they choose to get those services elsewhere,” the minister stated.
A board member of the WBCG, Johny Smith, said transport and logistics can be the pillars of the economy, contributing to growth and development.
Meanwhile, the logistics report added that of the three corridors connecting Walvis Bay with other Southern African Development Community (SADC) countries, the Walvis Bay-Ndola-Lubumbashi-Development Corridor is the busiest in terms of cargo transit, followed by the Trans-Cunene and Trans-Kalahari corridors.
Logistics costs declined by 15,6% in relation to GDP in 2017, compared to 17,6% in 2016.
The recent surge in fuel prices, as well as changes in the wholesale and retail trade sectors, are some of the factors likely to have had an effect on Namibia's logistics costs in 2018.
However, sustainable growth is required to ensure regional competitiveness, given developments in other African countries which have seaports, such as Tanzania and Mozambique, the report added.
Results for 2018 are likely to be very impressive for the port of Walvis Bay, with cargo volumes for the period January to September already exceeding those recorded in 2017.
In September 2018, the port of Walvis Bay showed an improvement in volumes of about 73 000 tonnes, surpassing the 2017 figure of 68 000 tonnes, the report added.