Posts tagged as: transportation

Charcoal Users Feel Price Heat

By Ronald Musoke

Steven Byamukama has been vending charcoal for 20 years. His stall in Kisenyi, a low income section of Kampala city, is one of many on a charcoal dust covered and darkened patch almost a quarter of a football field. This is a dirty job and Byamukama employs an army of young men to do the heavy lifting. He handles the cash.

Like the other traders, Byamukama sells charcoal in various sizes; from longish large loads of over 75kg bags piled up on top of each other while others are in white high-density polyethylene sacks that contrast sharply with their black contents. He also displays smaller portions doled in plastic basins and discarded one litre paint tins.

The move toward the smaller portions is a result of rising charcoal prices. Many city residents can no longer afford the sack which goes for Shs80, 000, up from Shs60, 000 last year, a 30% price leap in an economy where inflation is well below 10%. According to Dr. Cornelius Kazoora, an environmental economist who has been studying the charcoal business for some time, what is happening is a “charcoal crisis.”

“Most people in Uganda are poor and the packaging of charcoal allows a person to get it for even Shs 1,000, cook a meal, and eat,” he told The Independent in an interview.

Byamukama sells a 20-litre plastic basin filled to the brim for about Shs 8000, while a smaller metallic tin called “Ddebe” goes for Shs5000.

But he complains that while the charcoal business used to be quite lucrative, his buying price has risen and his margins shrunk.

“Trees have become scarce yet the population is ever growing,” he says.

He describes how, when he started his business, it was easy to source good charcoal in the neighbouring districts of Luweero, Nakaseke and Kyankwanzi where the average distance is 50kms away from the city in central Uganda. These days, he says, most of the charcoal he sells comes from northern Uganda, at least 350km away.

Kazoora confirms this. He says people in the Cattle Corridor (Luweero, Nakasongola, Kyankwanzi, and Masindi) opened up land for plantation agriculture and livestock rearing– a development which reduced woodland in this area and has eventually affected the volume and quality of charcoal that is sold in Kampala.

To get a good stock of charcoal, Byamukama and his colleagues sometimes intercept the trucks transporting the commodity before they get into the city suburbs where competition between dealers is stiff.

He told The Independent that he now buys a sack of charcoal from truck drivers at between Shs 70,000 and Shs77, 000 and sells each sack at Shs80, 000 and, depending on demand, Shs90, 000.

Khamadi Musiimenta, another trader who has dealt in charcoal for the last 20 years in a market in Kamwokya, a suburb of the city, also recalls a time recently when most of the charcoal sold in Kampala used to come from the nearby districts and one could buy a bag of charcoal at Shs20, 000.

He says he gets his charcoal from as far as Adjumani district in northwestern Uganda and sells a bag at Shs 80,000. He says this is the first time they have seen charcoal prices shoot that high.

Ephraim Zinda, 34, who has been in the charcoal transport business since 2008 told The Independent that charcoal prices could be rising because local governments in the source districts in northern Uganda are getting tougher on charcoal burners. This has led to reduced supplies. But he says corruption contributes to the high cost of transport and the eventual user price.

Zinda says along the 350km route, even before he ignites the engine of his truck headed for Kampala from Gulu, he pays anywhere between Shs700, 000 to Shs1.5 million for a General Receipt to the National Forestry Authority. Then along the way, he must leave between Shs30, 000 and Shs20, 000 at every road block in Gulu town, Bobi, Kiryandongo, Luweero, Kawempe, Bwaise, and Kasubi. Zinda says this is the reason most trucks tend to move at night to minimize these unnecessary costs.

“Otherwise we might end up with nothing by the time we reach our destinations,” he says.

Charcoal remains the most preferred energy source for use in about 90% of households in Kampala while elsewhere the average is 65% with the rest using wood fuel. Overall, about 4,961 metric tonnes of charcoal is used by households in Uganda per day while institutions use a total of 887.3 metric tonnes of charcoal over the same period.

A 2015 energy ministry survey on the status of charcoal production, transportation, trade, and consumption noted that up to 2.144 million metric tonnes or 35,153,081 bags of charcoal each weighing 60kgs are produced and consumed every year in Uganda. This charcoal is valued at about US$38 million.

Wrong interventions?

Charcoal preference in Kampala is mostly a practical decision as most households do not have separate cooking areas to set up a wood fire and charcoal is more portable, smoke free, and burns hotter and longer. But with rising prices, many users and experts are looking for ways out.

Experts argue that in the longer term, economic benefits of charcoal must be replaced with new development options. They say the government needs to quickly find sustainable and safe energy options for rural and poor populations.

Currently, Uganda’s entire charcoal value chain is characterised by informal and inefficient systems and has received little interest from investors. It is characterised by inadequate enforcement of regulations, poor organisation of players, use of inefficient technologies, and lack of standards and unsustainable production practices.

Interventions that are spoken about often focus more on reducing the negative environmental impact of charcoal production and use and less on addressing the need for sustainable energy supplies for a growing urban population.

Urging the government to sensitize the population about the dangers of wood-based fuels to the environment, quickly enforcing measures against illegal wood harvesting, banning illegal charcoal production, and imposing heavy fines and taxes on charcoal and firewood trade, will salvage the environment but people have to cook.

James Kakeeto, the Chief Executive Officer of Creation Energy Limited, a Kampala-based renewable energy initiative told The Independent on Sept.22 in an email that Ugandans are still struggling to switch to cleaner fuels because even with all its disadvantages, charcoal remains the most adopted cooking fuel in Uganda and, this is largely determined by the fact that it is still considered cheap compared to other options such as LPG and electricity.

To most Ugandans, LPG is considered unsafe and risky in terms of causing possible fires in households. The fact that Ugandans have used charcoal for a long time means that the attachment is high, to the extent that the people find any other new option such as briquettes an inefficient inconvenience.

Kakeeto told The Independent that weaning Ugandans off wood-based fuels cannot be done in an instant, but rather gradually.

For a start, the government needs to mobilise financial resources to make the Biomass Energy Strategy, which seeks to promote investments in efficient biomass technologies such as briquettes and energy efficient cook stoves work. That would help cushion entrepreneurs from the investment risk associated with alternative and modern cooking fuels.

Charcoal to stay

For Simon Peter Amunau, the manager of the UNDP-funded Green Charcoal Project at the Ministry of Energy and Mineral Development, charcoal is here to stay for the simple reason that electricity and LPG remains quite expensive for millions of Ugandans.

“What we need to do is to promote charcoal production in a sustainable manner,” he says, “The current charcoal production techniques are wasteful with only 10% of charcoal produced in the traditional kilns.”

Amunau says the ministry is promoting efficient charcoal producing technologies which are able to recover 30-45% of the charcoal.

He says if charcoal producers adopt these technologies, then Uganda will see a cut back on trees and forests which are being felled to produce more charcoal.

The energy ministry is also promoting tree planting in the districts of Nakaseke, Kiryandongo, Nakasongola, Mubende and Kiboga where already 4,000 hectares have been planted on private farms and NFA forest reserves.

Amunau said the ministry is also embarking on a campaign to work with all stakeholders along the charcoal value chain– forest owners, charcoal producers, transporters, vendors and the users–to promote tree planting; efficient production techniques, good charcoal packaging ways to reduce moisture content, as well as promoting energy-efficient stoves.

Kazoora agrees that charcoal will remain big business for decades but making LPG cheaper can reduce demand for it. He says most people in Uganda could opt for LPG (gas) but are put off by the high cost involved and the lack of facilities for sale of small potions as happens with charcoal.

“If the government forfeited revenue in the short run and started shifting people to LPG then it would be easy to enforce laws against tree cutting,” he says, “Things work better when there are alternatives.”

Environmentalists are already saying charcoal has put deforestation into over drive, exacerbating already deadly climate change effects which are killing people in their homes.

Uganda is losing 60 million metric tonnes of wood every year valued at Shs 1,179,385,920,000. The government on the other hand is also losing Shs 268,516,106,157 in uncollected permit and VAT revenue that could be used to sustain the sector.

Henry Neufeldt, an expert on charcoal and climate change at the World Agro-forestry Centre in Nairobi told The New York Times in June last year that in the next 30 years, many forests and landscapes will be degraded because of charcoal demand, and because of the lack of policies to counter that effect.

Meanwhile, energy experts say charcoal users might have to brace themselves for harder times as prices continue to rise, thanks to excessive demand in the urban areas.

Uganda:Uganda, Kenya Failed Railway Deal – RVR Chief

By Frederic Musisi

Kampala — Uganda and Kenya failed the “logistical eco-system” that led to the problematic railway operations by Rift Valley Railways (RVR) and consequently the back to back termination of the concession by the two governments, the managing director of Transportation at Qalaa Holdings S.A.E, Mr Karim Hassan Sadek, has revealed.

Qalaa Holdings, a Cairo based private equity and venture capital firm, formerly known as Citadel Capital, holds majority stake in the RVR consortium which was leased operations for the Uganda-Kenya meter gauge railway in 2005 running until 2030.

In an interview with Daily Monitor last week in Kampala, Mr Sadek said for years prior to the signing of the concession, Uganda Railway Corporation (URC) and Kenya Railways Corporation (KRC) were loss making entities and that operating the railway required more than just an investor sinking in money.

“A railway operates a logistical eco-system which was and is in the hand of the two governments, such as the port at Mombasa operated By Kenya Ports Authority (KPA), customs under Kenya Revenue Authority (KRA) and Uganda Revenue Authority (URA) but unfortunately they were all reading from different scripts,” he explained.

Kenya terminated the RVR concession in August after a protracted legal battle, followed by Uganda on October 4.

Grounds of termination

Finance minister Matia Kasaija, in the termination letter, premised the decision to mainly RVR’s failure “to remedy the events of default” within the period specified in the different reminders that had been issued to them over the last months.

Mr Kasaija who first hinted on revoking the concession while reading the Budget in June, cited other factors such as RVR’s failure to; hit the agreed freight volume targets which were even revised downwards in 2014, submit quarterly and annual external audit reports, failed to rehabilitate and operate the Pakwach line, and generally all assets leased to them.

He also instructed the company to hand back the conceded assets including without limitations all updated data, files and software (or part thereof relating to the conceded assets) to Uganda Railway Corporation URC immediately and provide a handover report, and further demanded that RVR’s guarantor, UAP Insurance, pays URC $3m (Shs10.6b) as performance bond due.

Mr Sadek, in the interview, said the Ugandan government first issued them with a termination notice on July 28 last year detailing nine areas “they claimed we had defaulted at the time when we were in the midst of getting new investors.”

The nine areas were similarly contained in the final October 4 termination notice.

“We responded to each of them concerns put forward providing a breakdown of each of the point, some of which were factually incorrect,” Mr Sadek added. “Nothing happened in the period that followed, except the first notice of termination in April this year and another in June, with a 90 days expiry date.”

On August 30, Mr Sadek said RVR “presented a notice for arbitration and in September when the notice of termination was supposed to expire, we went to High Court and secured an injunction to basically stop the termination until arbitration has been disposed of.”

“Today we are operating under court order freezing termination until it decides whether there are grounds for termination or not. My understanding of that are two things; one that there is a contractual arrangement between both parties, and secondly whether there is a dispute or not,” Mr Sadek explained.

“There is a documented sequence of events and as a country with rule of law, I am startled when the government moves to terminate the concession yet a court case has not yet been disposed of.”

The railway line is 1,300km from Kampala to Mombasa; with 1,000km in Kenya and 300km in Uganda. As a result of this, Mr Sadek said, Uganda accounts for 75 per cent of RVR revenues while Kenya accounts of 80 percent total costs due to the distance.

When Kenya first terminated RVR’s concession, Mr Sadek said, “our thinking was that we can have the Ugandan concession even after the latter is gone.” This would work in a way that KRC which now operates the Kenyan line would move the freight up to Malaba, from where we would pick them to Kampala.

“It was ideal for us; it meant we no longer had to hustle about the 1,000km in Kenya. In any other case, the lenders were ideally getting no money out even after taking the haircut; so for each 70 per cent of a dollar invested they recovered only 26 percent.”

Prior to the concession both the Uganda and Kenya lines were managed differently by URC and KRC, respectively. However the concession introduced the “corridor” model of the line being manned singularly from Mombasa to Kampala.

RVR defended that they mostly invested in “locomotives in Kenya” given the long distance and upgraded those in Uganda but still are weak.

RVR system has 219 locomotives (175 in Kenya and 44 in Uganda) and approximately 7,500 wagons and three water ferries (6,000 wagons and one ferry in Kenya and 1,433 wagons and two ferries in Uganda).

Uganda’s first termination notice last year, Mr Sadek, said alarmed both auditors and potential lenders “which means we had to take further downscale within our budget.”

“The reason why we went to court in Kenya and now in Uganda was not to delay any process or rather to stop them from terminating us but it was rather to talk sense in each other because we thought they had thought reasoning; unfortunately we are not seeing any of that.”

The termination has since been done and sealed in Kenya but in Kenya it leaves behind unanswered queries of who is going to manage the transition or even pay salaries of staff for the months of September and October.

A team of government officials led by Works minister Monica Azuba and junior investment minister Evelyn Anite, while touring RVR/URC assets on October 6, indicated that that government was not ready to continue “looking on as RVR messed up the concession.”

URC board chair Hannington Karuhanga attributed the current sorry state of the railway network to negligence by RVR “which looked on as most assets were being vandalized.”

But Mr Sadek wondered how they were supposed to “protect all assets without input from URC. This is something we left to them every now and then but they never showed any interest in acting.”

“Before we took over management most of the assets in both countries had been vandalized but we tried as much as possible to restore and rehabilitate whatever we could,” Mr Sadek noted.

He added: “That does not mean that we did not have shortcomings as investors but in any case we tried, except that there was not commitment from neither governments for this railway to succeed given their current focus on standard gauge.”

Nigeria:Alternative Energy May Force Oil Prices Down to $10 Per Barrel, Says Expert

By Oladeinde Olawoyin

As alternative energy fuels continue to attract more investors across the world, oil prices are poised to crash to just $10 per barrel, an expert has said.

In an interview with CNBC on Friday, Chris Watling, chief executive of Longview Economics, said the crash may be experienced over the next six to eight years.

In his forecast for 2018, Mr. Watling acknowledged that a key catalyst for the oil market would most likely be Saudi Aramco’s initial public offering (IPO) in the second half of next year.

Speaking on Saudi Arabia’s state oil group being launched on the international stock market, he said the oil producer needed to get it away before the crash.

“Well I think they need to get it away quick before oil goes to $10 (per barrel),” he said.

Mr. Watling, however, explained that he did not necessarily expect such an intense decline in oil prices over the coming weeks or months.

“What happens with electric vehicles is really, really important,” he said, saying that’s because “about 70 per cent of oil is used for transportation.”

According to the International Energy Agency (IEA), the global outlook for oil markets in 2018 could put a dampener on hopes for higher prices.

In its report Thursday, the IEA said global stock builds, rising non-OPEC production and static oil demand could weigh on the oil price.

The organisation’s latest monthly report was published amid optimistic forecasts from the major oil producer group OPEC, with the cartel arguing there was evidence of the global oil market rebalancing following several years of low prices.

In June 2014, the price of oil collapsed from almost $120 a barrel due to weak demand, a strong dollar and booming U.S. shale production.

OPEC’s reluctance to cut output was also seen as a key reason behind the fall. But, the oil cartel soon moved to curb production — along with other oil producing nations — in late 2016.

But Nigeria was exempted from the cut imposed on member countries in January 2017, due to its low output caused by unrest in its oil rich Delta region.

In September, the Joint Organisation of Petroleum Exporting Countries, OPEC, and non-OPEC Ministerial Monitoring Committee, JMMC, also extended the exemption granted the country over the output cut.

At its meeting in Vienna, Austria, the Committee upheld Nigeria’s position that the exemption, which was extended by another six months last May, should be sustained until the country’s oil production stabilises.

The extension of the exemption period means more revenue earnings from oil exports by Nigeria, as the country would be able to export all the oil it produces as oil prices hover around $57 a barrel.

Ibe Kachikwu, Nigeria’s oil minister, has said that although Nigeria was making considerable progress since October 2016 in its production recovery efforts, it was not enough as full stability had not been attained.

“Although Nigeria’s oil production hit 1.802 million barrels per day in the month of August, that was not enough justification for a call by some countries for Nigeria to be brought back into the fold,” Mr. Kachikwu pointed out.

The next JMMC Meeting is scheduled to be held in Vienna, on November 29, 2017.

Speaking further on Friday, Mr. Watling said things are changing and people may shift attention to alternative energy sources.

“We forget don’t we? I mean 120 years ago the world didn’t live on oil. Oil hasn’t always driven the global economy… The point is alternative energy in some forms is gathering speed (and) things are changing,” he added.

The Longview Economics CEO forecast the price of oil would ultimately slump to $10 a barrel over the next six to eight years.

Nigeria: Govt to Review Power Sector Privatisation

By Ndubuisi Francis

Abuja — The federal government disclosed Thursday that it is considering a review of the power sector privatisation, commencing with the 11 electricity distribution companies (Discos) in the country.

The Minister of State for Budget and National Planning, Mrs. Zainab Ahmed, unveiled government’s new thinking in Abuja at the question and answer session with journalists, which drew the curtains on the 23rd Nigeria Economic Summit (NES) organised by the Nigeria Economic Summit Group (NESG) in collaboration with the Ministry of Budget and National Planning.

Ahmed stated that the government and other stakeholders had come to the realisation that something critical needed to be done quickly in the power sector.

The review of the power sector privatisation, she stated, would commence with the Discos.

Ahmed said: “The power sector has been privatised but I’m sure every Nigerian can attest to the fact that the privatisation has not worked well, in the sense of what we sought to achieve in terms of power efficiency.

“It has not yet happened. We have now come to the point where government which is a stakeholder in the power sector and other stakeholders must come together and decide and cede some of their holdings to new investors that will inject new funding; investors that have the expertise to grow the power sector that will serve Nigerians.”

She continued: “It’s a process that is on-going, it involves negotiating with the existing owners and also with the government in deciding the right level of holdings that will go up for another round of sale.

“The privatisation has not worked out. We discovered that many of the companies are indebted to the banks, making it difficult for them to make fresh investments in their infrastructure.

“All stakeholders must come together to grow the sector, especially in discussing with the existing owners.”

The minister explained that before any new investment is made in the sector, the contentious issue of tariffs must also be discussed and agreed by all stakeholders in order to attract new investors.

Explaining the government’s thinking to attract fresh investments in the power sector, given the tariff quagmire, she said: “We said the power sector would be opened up to new investors. But it’s very clear that many won’t be convinced with the level of tariff.

“That’s a discussion that has to be held with the new investors. It’s very clear to us that the level of tariffs that we have now is not sustainable but where the tariffs will go will be the subject of negotiations between the government, the existing investors, the new investors and consumers.

“We will try to attain some optimal level that will make an impact on the tariff structure. The starting point will be the Discos.”

On the 2018 budget proposals, the minister said her ministry was ready to meet the October deadline it announced earlier for its submission to the National Assembly.

“The 2018 budget will be presented to the National Assembly in October and we are still on course. The budget is ready, it will be going to the Federal Executive Council (FEC) first of all for approval before Mr. President now conveys it to the National Assembly.

“We are on course to deliver the 2018 budget in October. We hope that working together with the National Assembly, the 2018 budget will be passed on time in December so that in January, we can start with a fresh budget going forward,” the minister said.

On the federal government’s domestic borrowings which is crowding out the private sector, the minister said government had reviewed its loan strategies.

“Government does not go to borrow at 20 per cent. The market actually determines the borrowing, but the point we are making is that because government is borrowing heavily, the financial sector is now concentrating on lending to the government and the private sector gets little or no attention at all.

“Why would the financial sector want to lend when they can buy Treasury Bills at 22 per cent? So we have come to the conclusion that government must reduce its domestic borrowing to free the space so that the financial sector is enabled to borrow to the private sector,” she explained.

On the NES as a platform for the exchange of ideas on the economy between the private and public sectors, she said recommendations arising from the summit would continue to form the nucleus of government’s policies.

“The NES has become a tradition; an institution, if you like, and every year we look forward to it. This is a summit that is undertaken in partnership with the NESG, the Ministry of Budget and National Planning, and indeed the government,” she said.

This year’s summit with the theme: “Opportunities, Productivity & Employment – Actualising the Economic Recovery and Growth Plan,” the minister noted had intense deliberations for three days.

“We had discussions that centred around strengthening skills and competency, access to finance; we also had discussions around the legislation required to unlock opportunities to grow the economy,” she said.

She added that at the end of it, “we have a summit report, a draft of which has been handed over to us today to government”.

“We will begin to work again in partnership with the NESG and its organised committees on how to address all of the various recommendations that have come out of this session,” she explained.

Responding to a question on the chaotic traffic situation in Apapa, Lagos, the minister said the reconstruction of very critical roads in the port city had been approved.

She stated that the level of degeneration of the roads in Apapa had led to recommendations for total reconstruction, noting that the federal government was determined to do so.

On what the government was doing to ensure optimal performance of the ministers, she said a monthly performance chart with set targets had been prepared by her ministry.

She said there would be consequences for failure to meet set targets.

Also speaking at the event, Mr. Nnanna Ude of the National Assembly Business Environment Roundtable (NASSBER) described the consensus reached at NES 2017 as fruitful, calling for quick legislative actions on them.

He said: “There are pending bills and we always try to carry out the economic impact on them. For instance, the Competition Bill has the capacity to create 381,000 jobs annually, generate revenue of N148.3 billion yearly.

“It will also lead to a 10 per cent reduction in the prices of goods. For the National Transportation Commission Bill, it will also boost job creation and government revenue.”

Nigeria:Govt to Review Power Sector Privatisation

By Ndubuisi Francis

Abuja — The federal government disclosed Thursday that it is considering a review of the power sector privatisation, commencing with the 11 electricity distribution companies (Discos) in the country.

The Minister of State for Budget and National Planning, Mrs. Zainab Ahmed, unveiled government’s new thinking in Abuja at the question and answer session with journalists, which drew the curtains on the 23rd Nigeria Economic Summit (NES) organised by the Nigeria Economic Summit Group (NESG) in collaboration with the Ministry of Budget and National Planning.

Ahmed stated that the government and other stakeholders had come to the realisation that something critical needed to be done quickly in the power sector.

The review of the power sector privatisation, she stated, would commence with the Discos.

Ahmed said: “The power sector has been privatised but I’m sure every Nigerian can attest to the fact that the privatisation has not worked well, in the sense of what we sought to achieve in terms of power efficiency.

“It has not yet happened. We have now come to the point where government which is a stakeholder in the power sector and other stakeholders must come together and decide and cede some of their holdings to new investors that will inject new funding; investors that have the expertise to grow the power sector that will serve Nigerians.”

She continued: “It’s a process that is on-going, it involves negotiating with the existing owners and also with the government in deciding the right level of holdings that will go up for another round of sale.

“The privatisation has not worked out. We discovered that many of the companies are indebted to the banks, making it difficult for them to make fresh investments in their infrastructure.

“All stakeholders must come together to grow the sector, especially in discussing with the existing owners.”

The minister explained that before any new investment is made in the sector, the contentious issue of tariffs must also be discussed and agreed by all stakeholders in order to attract new investors.

Explaining the government’s thinking to attract fresh investments in the power sector, given the tariff quagmire, she said: “We said the power sector would be opened up to new investors. But it’s very clear that many won’t be convinced with the level of tariff.

“That’s a discussion that has to be held with the new investors. It’s very clear to us that the level of tariffs that we have now is not sustainable but where the tariffs will go will be the subject of negotiations between the government, the existing investors, the new investors and consumers.

“We will try to attain some optimal level that will make an impact on the tariff structure. The starting point will be the Discos.”

On the 2018 budget proposals, the minister said her ministry was ready to meet the October deadline it announced earlier for its submission to the National Assembly.

“The 2018 budget will be presented to the National Assembly in October and we are still on course. The budget is ready, it will be going to the Federal Executive Council (FEC) first of all for approval before Mr. President now conveys it to the National Assembly.

“We are on course to deliver the 2018 budget in October. We hope that working together with the National Assembly, the 2018 budget will be passed on time in December so that in January, we can start with a fresh budget going forward,” the minister said.

On the federal government’s domestic borrowings which is crowding out the private sector, the minister said government had reviewed its loan strategies.

“Government does not go to borrow at 20 per cent. The market actually determines the borrowing, but the point we are making is that because government is borrowing heavily, the financial sector is now concentrating on lending to the government and the private sector gets little or no attention at all.

“Why would the financial sector want to lend when they can buy Treasury Bills at 22 per cent? So we have come to the conclusion that government must reduce its domestic borrowing to free the space so that the financial sector is enabled to borrow to the private sector,” she explained.

On the NES as a platform for the exchange of ideas on the economy between the private and public sectors, she said recommendations arising from the summit would continue to form the nucleus of government’s policies.

“The NES has become a tradition; an institution, if you like, and every year we look forward to it. This is a summit that is undertaken in partnership with the NESG, the Ministry of Budget and National Planning, and indeed the government,” she said.

This year’s summit with the theme: “Opportunities, Productivity & Employment – Actualising the Economic Recovery and Growth Plan,” the minister noted had intense deliberations for three days.

“We had discussions that centred around strengthening skills and competency, access to finance; we also had discussions around the legislation required to unlock opportunities to grow the economy,” she said.

She added that at the end of it, “we have a summit report, a draft of which has been handed over to us today to government”.

“We will begin to work again in partnership with the NESG and its organised committees on how to address all of the various recommendations that have come out of this session,” she explained.

Responding to a question on the chaotic traffic situation in Apapa, Lagos, the minister said the reconstruction of very critical roads in the port city had been approved.

She stated that the level of degeneration of the roads in Apapa had led to recommendations for total reconstruction, noting that the federal government was determined to do so.

On what the government was doing to ensure optimal performance of the ministers, she said a monthly performance chart with set targets had been prepared by her ministry.

She said there would be consequences for failure to meet set targets.

Also speaking at the event, Mr. Nnanna Ude of the National Assembly Business Environment Roundtable (NASSBER) described the consensus reached at NES 2017 as fruitful, calling for quick legislative actions on them.

He said: “There are pending bills and we always try to carry out the economic impact on them. For instance, the Competition Bill has the capacity to create 381,000 jobs annually, generate revenue of N148.3 billion yearly.

“It will also lead to a 10 per cent reduction in the prices of goods. For the National Transportation Commission Bill, it will also boost job creation and government revenue.”

Nigeria: Freight Forwarders Laud Nsc On Ease of Doing Business

By Eromosele Abiodun

Freight forwarders have expressed satisfaction with the Nigerian Shippers’ Council (NSC) on some policies and projects being promoted by the ports economic regulator that are targeted at achieving ease of doing business at the ports.

President of the National Association of Government Approved Freight Forwarders (NAGAFF), Chief Increase Uche stated this in a chat with journalists in Lagos.

He said interface with service providers and customs service commands by the NSC leadership and management staff on ease of doing business have impacted positively on services at the ports, smoothening operations in many ways, the freight forwarders said

The agents pointed out that dialogue with the service providers on the need to fast-track services at the ports compelled many of them to improve on their equipment profile.

Having enough cargo handling equipment, according to freight forwarders, helps in positioning of containers for examination very fast, thereby improving on turnaround time of vessels calling at the nation’s ports.

He said the council has done well in getting service providers to do everything that will facilitate trade in the country.

Uche said that the council has been able to carry every stakeholder along on issues affecting the industry, adding that this was responsible for the goodwill that the economic regulator enjoys in the sector.

“NSC has really done well. I must give them kudos, looking at how far they have been able to handle the aspect of their functions in the logistics chain,” the NAGAFF President said.

He added that the council needs to be protected and empowered by statutory laws that will enable them ‘bite when the need arises’.

He expressed dismay on the issue of shipping charges which the council had declared as illegal, stopped but was challenged in the court.

According to him, it was worrisome that even as the court judgment was against the service providers on the collection of the shipping charges, the companies involved had a field day until the last judgment in the Appeal Court.

Uche said this was so because it appeared that the council did not have enough instrument of law to check the service providers, explaining that this was why his association supports more legal empowerment for the agency.

He said that freight forwarders were excited with the passage of the NTC Bill by the House of Representatives in which the NSC is to simply transmute into the agency.

Urging the Senate to concur on the passage of the bill, Uche said that this was deserving considering the achievements recorded so far in the maritime industry, which according to him, was more technical than other aspects of the transport sector.

He also described the Inland Dry Port (IDP) and Truck Transit Park (TTP) projects being promoted by the council as having a great value not just for the shippers but also for the entire logistics industry.

While IDPs will promote import and export business in all parts of the country, particularly the rural areas, TTPs, he emphasized, will ease transportation for truck drivers.

He said: “With IDPs, businessmen in all parts of the country will have advantage of having shipping services nearer to them. This will make export business easy for them. It will save us the nightmare of having to travel long distances to Lagos ports or other seaports to consign their goods for export. In the same way, international trade, such as importing goods overseas becomes easier for them. They don’t have to travel so far to do this. On the TTPs, the advantage is that truck drivers will have a place they can rest while on a long journey. Parking along the expressway as they always do is not the best for security and safety reasons. The TTP will offer them the opportunity to rest in a safe and secure place before they continue their journey”.

South Africa: Dial-a-Ride Users Say the Service Is Deteriorating

By William Yoder

Some members of the Dial-a-Ride User’s Forum have expressed concerns about the safety and quality of the service as well as fee increases under the current contractor.

Members of the forum say the service they get from Dial-a-Ride, which provides transportation to people with disabilities, has deteriorated since HG Travelling Services won the tender on 1 December 2015.

In April, users protested against the provincial government about the use of MyCiTi branding, availability, cost and safety. A Dial-a-Ride bus was attacked recently in a housing protest.

Debbie Bedien, a member of the forum, said that buses used to be plain white with yellow Dial-a-Ride logos. “Whether it was taxi strikes, public strikes,or bus strikes, we weren’t affected,” Bedien said. But the buses now have the colour scheme and the logo of MyCiTi buses.

HG Travelling Services referred GroundUp to the City of Cape Town for comment. The City said the vehicles were clearly marked on the back and sides. However, a Dial-a-Ride vehicle which GroundUp photographed did not have these signs on the right side (it did have a sign on the left side).

Brett Herron, Mayoral Committee Member for Transport, said, “The MyCiTi logo features on all of those vehicles that are contracted by the City to provide a public transport service to the public.”

Dial-a-Ride Forum members also complained about the rising cost of the service. Since 2015, a 20km trip with Dial-a-Ride has gone from R8.80 to R13; for a trip under 5km it has gone from R6.70 to R9.

Members of the forum complained that the service was very booked up and Cape Town’s other public transport services were mostly inaccessible, a situation not set to change for several years.

“By 10:30am all rides [for the next week] are fully booked,” said Bedien.

About 800 people use the service on a “regular or ad hoc basis” according to Herron. He said HG Travelling Services had increased capacity for wheelchair users from 72 to 102 since gaining the contract. It currently operates 21 vehicles, 20 of which can accommodate passengers using wheelchairs.

Elroy Lodewyk, also a member of the Dial-a-Ride forum, said bookings were sometimes missed. He said some commuters had even lost their jobs due to the lack of reliability of Dial-a-Ride.

But Herron said, “The City was not informed about any commuter who has lost his/her job as a result of the Dial-a-Ride service.”

He said financial penalties could be imposed by the City should HG Travelling Services fail to provide adequate service.

Dial-a-Ride users say that passengers can be on the bus for hours. Another member of the forum, Luwie Links, said, “They pick up something like nine people. If you are first to be picked up at 5:10am in the morning, you will arrive at work at 8 or 8:30am.”

Members of the forum are also unhappy that Dial-a-Ride now requires users to be assessed by an occupational therapist every two years, even in cases where users’ disabilities are permanent.

Lodewyk said, “I’m 22 years in a wheelchair. What, after 23 years I will walk again?”

Nigeria:Uber’s Productive Four Years of Economic Transformation

By Emma Okonji

Uber has in the last four years of its operation in Africa, changed the perspectives in the transportation system, while using technology to drive economic transformation in the sector.

When Uber was first established in 2009, its mission was to help people everywhere get a ride, safely, quickly and at the push of a button. Eight years later, that mission remained the same and Uber’s innovative, technology-driven business model is still fundamentally changing the way people think about meeting their transport needs.

For the past four years, Uber has been delivering the same level of transformation across sub-Saharan Africa (SSA) and with more than 1.8 million active riders using the app, Uber certainly has reason to celebrate its fourth anniversary on the continent.

The benefits

Speaking on the technology innovativeness infused into the transport system that has benefitted several countries, the General Manager for Uber SSA, Alon Lits, told THISDAY that several companies and individuals in Africa have benefitted from Uber since its launch in Africa four years ago.

According to Lits, “It is not just Uber that has benefitted from the stellar uptake of its convenient offering in Africa. The SSA countries in which Uber now has a presence, and the citizens of those countries, are also reaping significant socio-economic rewards thanks to the transformation that the Uber approach has helped to drive.”

At an economic level, these benefits take many forms. In many cities, the reliability, immediacy, and convenience that Uber offers to city residents and visitors is having the positive impact of helping to reduce congestion. In most urban parts of SSA, single occupant vehicles remain the biggest contributors to gridlock.

“But increasing numbers of city residents are recognising that Uber offers a cost effective way of sharing their daily commute with others, thereby reducing the total number of vehicles on the roads, while at the same time cutting down on the costly wear and tear that regular stop-start driving causes,” Lits said.

The perceptions

Repeat Uber usage in South Africa is a prime example of these shifting private transport perceptions. This month, almost 25,000 riders each used Uber more than 10 times a week, which points to the increasing adoption of this tech-driven solution, not just as a leisure transport option, but also for work and business purposes. This demonstrates that Uber is a true alternative to private car ownership.

Another significant benefit that Uber is delivering in SSA, is enabling and empowering economic opportunities and offering more choice. The steadily growing number of Uber driver-partners in countries across the region is testament to the appeal of the Uber business model. That is because it creates real opportunities for local entrepreneurs to create and enjoy the flexibility and enhanced earnings potential – for themselves and, ultimately, for individuals that many of them bring into their thriving and growing transport businesses.

Growth trajectory

The growing demand for trips across the SSA region leads to a steadily growing need for drivers. Currently more than 29 000 such driver-partners are taking advantage of the earnings generating opportunities delivered by the Uber app. Importantly, the Uber model allows these individuals to be as flexible as they need to be, which means that they are able to earn what they want, when they want to, either as a full-time entrepreneurs or to supplement other sources of income.

Lits explained that Uber investigates partnerships with businesses that bring benefits to drivers, such as the multiple vehicle financing programmes that have been made available to drivers across South Africa, Kenya and Nigeria, that reduce barriers to credit and capital. The first partnership of this kind was implemented in South Africa with WesBank, offering existing drivers access to vehicles at preferential rates, with a view to establishing their own passenger transport business. This unique model is based on driver ratings and earning potential, as opposed to the norm of credit checks. The model was successfully expanded across SSA and is being tested in markets across Europe, Middle East and Africa (EMEA).

Uber’s investments

Uber also invests heavily in supporting its driver-partners in their businesses through ongoing technological innovation as well as physical presences in the form of support hubs. Apart from the existing Greenlight Hubs across SSA, five more of these state-of-the-art Greenlight Hubs were opened in Dar Es Salaam, Nairobi, Kampala, Kumasi and Lagos this year.

In addition to offering driver-partners technical and app support, they also offer information sessions and tailored workshops to driver-partners, focusing on training and skills development.

In a region of high unemployment and stagnating economic prospects, Uber’s business partnership approach provides an accessible means for entrepreneurs to not only supplement their own income, but also to become small business owners, thereby helping to improve the lives and futures of individuals, families and communities.

Lits said Uber’s approach to shifting perspectives of how people in SSA move around their cities, is one of partnership with all stakeholders. According to him, Uber strives at all times to collaborate closely with local regulators to understand the challenges they are grappling with in their cities and then help them to develop workable and accessible solutions that benefit people and economies. It is with this in mind that Uber has just launched Uber Movement in Johannesburg, a new website to help urban planners, city leaders, third parties and the public better understand the transportation needs of their cities.

User’s entrepreneurship approach

Speaking on the Uber driver-partnership deal, Lits said: “The partnership approach has always been at the heart of the business because our global experience has shown us that multi-modal transport powered by technology is the best way to promote entrepreneurship, relieve pressure on infrastructure, and deliver safe and efficient transport that helps people connect with work, business and leisure opportunities.”

Uber’s mission

Uber’s mission is to help people get a ride at the push of a button – everywhere and for everyone. It started in 2009 to solve a simple problem – how do you get a ride at the touch of a button?

Eight years and over two billion trips later, the company said it started tackling an even greater challenge such as reducing congestion and pollution in cities by getting more people into fewer cars.

The Uber network is now available in over 600 cities in over 75 countries spanning six continents.

Ethiopia: Corp’s Attempts to Export Sugar Ends in Turmoil

A deal entered between the Ethiopian Sugar Corporation and a Dubai based buyer came to an abrupt end last week, after the latter pulled out of a contract signed to buy 44,000tns of sugar.

Agri Commodities wrote a letter of termination on October 3, 2017, informing the Corporation on the cessation of contract, valued at 2.2 million dollars. Controversy over the weight and quality of the merchandise led to the falling apart of the deal, accoridng to people close to the issue.

Following the termination, Bright Border Crossing Transport Association, the contracted company for the transportation of the item to Kenya, has begun returning the sugar from Moyale, a border town 794.7Km south of Addis Abeba, to Wonji. The trucking company has deployed 110 trucks to return the merchandise to the factory, beginning yesterday.

Agri had not made any payment to the Corporation claiming failure to confirm the shipping document, although it was supposed to settle the invoice before the merchandise exited the factory.

“If you had presented all the documents in time, you would have been paid under the letter of credit,” reads the letter Agri wrote to the Corporation.

Signed by Krishnakant Mishra, representative of the company, the letter attributed the termination to the inability of the Corporation to present a certificate of weight and quality issued by an independent body.

“This is a minor discrepancy not to pay us for the sugar,” Gashaw Aychiluhim, corporate communications director of the Corporation, told Fortune. “They will be accountable for the loss we incurred.”

Agri demanded that the Corporation covers the 242,000 dollars it paid to transport the sugar and claimed compensation for the failure of the contract. The merchandise has been exposed to temperature and spoilage during the two-month trucks were stranded in Moyale.

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South Africa: City of Cape Town Intends to Take Over Commuter Trains

By William Yoder

On Tuesday, Mayoral Committee Member for Transportation and Urban Development Brett Herron announced at a press conference that the City intended to take over the management of commuter rail in Cape Town.

Herron said commuter rail was “on the brink of total collapse”. “This would be disastrous” for the city he said.

The current plan of the National Department of Transport to modernise the rail service would not be implemented until 2025. The City intended to expedite this process.

Metrorail would continue to provide the transportation service, while the City would maintain and operate the infrastructure.

Herron provided no specific timeline for the project, but in the short term, the City would assist Metrorail to prevent the train operator’s service from collapsing.

The City had identified 16 key functional components, such as ticketing, signalling and stations. Herron said the City intended to fix each component in order to convince commuters that the rail service is once again a viable option.

The rail system, currently operated by PRASA, has been in a “state of constant decline”. The number of passenger rail users has fallen by 30% since 2015. Only four out of ten trains arrive on time. 11% are cancelled. The failures of the rail service has led to an increase in road congestion.

As of April, Metrorail was operating with 68 train sets, 20 short of its minimum. Herron said that while 88 sets is the current minimum, over 100 are required to run an efficient rail service.

“It is not something that will improve overnight,” Herron admitted.

R20 million was needed to develop the plan and the City had identified the Public Transport Network Grant and the Integrated Cities Development Grant as potential sources of funding.

The City would first intensify efforts to stabilise the passenger service and prevent further decline. To do this the City needed to access the local operational and financial data of PRASA.

The request to the National Department of Transport to devolve control of commuter rails to the municipality would be submitted to the City Council on 26 October, after review by the Mayoral Committee next week. Full details would be available thereafter.

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