Africa’s container shipping: opportunities and obstacles

As Africa modernises its ports and logistics infrastructure, the continent’s container shipping industry is growing, overcoming challenges to become a more integral part of the global trade ecosystem.

The African continent has witnessed a remarkable transformation in its logistics and transportation landscape over the past decade, with container shipping playing a pivotal role in this evolving narrative. As global trade patterns shift and the world becomes increasingly interconnected, Africa has emerged as a strategic hub for container shipping, unlocking new avenues for economic growth and integration.

According to the latest data by UN Trade and Development (UNCTAD) between the first half of 2018 and the first half of 2023, port calls by container ships in Africa rose by 20%, marking a record-breaking increase for the continent.

Current state and challenges

The container shipping industry in Africa has undergone a remarkable transformation over the past decade, with major ports across the continent experiencing unprecedented growth in container throughput. According to the latest data from the African Development Bank, the number of container units moving through African ports increased by nearly 50%, from 24.5 million to 35.8 million between 2011 and 2021.

However, the reality of container shipping in Africa presents a complex picture of both challenges and potential. Most African ports currently operate beyond their designed capacity, leading to severe congestion issues that plague the sector.

African ports are largely state-owned, making their operations sensitive to prevailing socio-economic conditions. While many countries have moved towards privatising port management, regional and political instability still hampers operations, customs procedures, and the transportation networks connecting to and from these ports. Africa has over 100 ports, yet only a few are equipped to handle the simultaneous arrival of today’s giant cargo ships, according to a report by In On Africa.

Operational inconsistencies, largely due to rising cargo volumes, limited resources, inefficiencies, and corruption, are common in many facilities. This is especially true in West African ports, where rapid growth in cargo flow strains facilities that need significant upgrades, including deeper draughts, expanded wharf space, updated equipment, and larger container storage areas.

According to a report by Sinay, African ports like the Lagos Port Complex (Apapa Port Complex) in Nigeria, one of the busiest in West Africa, face challenges due to outdated infrastructure and limited capacity, leading to significant congestion and long wait times for ships. Similarly, the Port of Mombasa in Kenya, a critical gateway for East African trade, struggles with ageing infrastructure and slow expansion efforts, resulting in delays in cargo handling and increased congestion.

Transformation and development

In response to these challenges, Africa is experiencing unprecedented growth in its container shipping infrastructure. In a recent interview with Bloomberg Television, Mohammed Akoojee, CEO and Managing Director for sub-Saharan Africa at DP World, a global logistics company announced plans to invest $3 billion over the next three to five years in new port and logistics infrastructure across Africa. This investment aims to support long-term growth, including the rising demand for critical mineral exports. The Port of Tema in Ghana is also increasing its capacity, with the second phase of its expansion project set for completion by September 2025 involving the paving of a substantial 270,000-square-meter area, which will expand the terminal’s footprint from 100 to 127 hectares.

APM Terminals has been a key enabler of Africa’s trade and logistics growth, which directly supports the goals of the African Continental Free Trade Area (AfCFTA).”
Igor van den Essen, APM Terminals

Terminal operators also play a crucial role in this transformation, bringing both capital and expertise to African ports. Global terminal operators like APM Terminals, DP World, and Bolloré Africa Logistics have established strong presences across the continent.

“In Nigeria, we have recently invested $115 Million in upgrading the West Africa Container Terminal ( WACT) terminal in Onne almost doubling the yard space, lifting safety standards, adding state-of-the-art equipment acquisition, and a modern office complex. In Morrocco, Tangier went live with the latest phase of its extension in December 2023. According to the latest analysis from the World Bank, Tangier is one of the world's top 10 performing ports,” says Igor van den Essen, Managing Director of Europe & Africa, APM Terminals.

“All regions and continents have their unique challenges related to infrastructure limitations and geopolitical risks. In that sense, Africa is not different. We see a lot of FDI in Africa, notably in expanding infrastructure such as container terminals. On a day-to-day basis, we operate our fleet as flexible as possible, making change of rotations to mitigate impact to our customers of congestions and delays. Our company continuously invests in products and services to support our customers and Africa to compete and win in the global markets,” says Rogelio Busto Duarte, Managing Director Area South, Northeast, and East Africa, Hapag-Lloyd.

The implementation of the African Continental Free Trade Area (AfCFTA) in 2021 has added another dimension to this transformation. Creating the world's largest free trade area by number of participating countries, the AfCFTA is driving the need for more efficient port infrastructure to handle the expected 33% increase in intra-African trade under full implementation.

“APM Terminals has been a key enabler of Africa’s trade and logistics growth, which directly supports the goals of the African Continental Free Trade Area (AfCFTA). We see the infrastructure financing gap as one of the most pressing barriers to the full realisation of AfCFTA’s potential. By investing in the modernisation and expansion of seaports across the continent, we are helping to create the infrastructure necessary for the successful movement of goods across borders.

For instance, our operations in Côte d'Ivoire have improved the capacity of the Abidjan Terminal, boosting its efficiency by 20%, and directly enhancing trade volumes. Such advancements facilitate smoother trade integration under AfCFTA by making African exports more competitive globally,” says van den Essen of APM Terminals.

One in five people will live in Africa by 2030. FDI will continue to increase. Africa will increasingly connect with global trade, and play an increasingly important role, also in geopolitics.”
Rogelio Busto Duarte, Hapag-Lloyd

The rise of mineral exports

According to data, Africa possesses a significant share of global mineral reserves, including 92% of platinum, 56% of cobalt, 54% of manganese, and 36% of chromium. These minerals are essential for producing green technologies, such as electric vehicle (EV) batteries and wind turbines. Currently, most minerals are exported from Africa in their raw form to be refined abroad, which drives significant demand for container shipping to global destinations, mainly in Asia, Europe, and North America.

China dominates the market, accounting for 85% of global processing capacity and 60% of worldwide production for critical minerals. Meanwhile, the Democratic Republic of Congo (DRC) refines about 7% of all copper products produced locally, and Zambia refines 1.3%.

A report by the United States Institute of Peace highlights the growing cooperation between China and Africa on green energy, critical minerals, and industrialisation. This collaboration is further bolstered by platforms like the Forum on China-Africa Cooperation (FOCAC), which drives economic partnerships and development initiatives across the continent.

Recently, Africa Finance Corporation (AFC) signed concession agreements with the governments of Angola and Zambia for the financing, construction, ownership, and operation of the Zambia Lobito Rail Project. AFC, as the lead developer, will play a major role in this project, which not only provides an efficient route for evacuating minerals and metals from the region but also establishes a trade corridor across Africa. This corridor connects the Port of Lobito on the Atlantic Ocean to the Port of Dar es Salaam on the Indian Ocean, facilitating both global and intra-African trade.

Navigating geopolitical complexities

Geopolitical instability, particularly in regions like the Red Sea, has forced shipping lines to reroute vessels around the Cape of Good Hope, resulting in longer journey times and increased operational costs. Recent data from UNCTAD indicates that this rerouting has intensified congestion at South African ports, opening up opportunities for strategically located countries such as Madagascar, Mauritius, Namibia, and Tanzania on maritime routes linking Asia and Europe.

Several East African countries, whose foreign trade relies heavily on the Suez Canal accounting for approximately 31% and 34% of trade volume for Djibouti and Sudan, respectively are particularly vulnerable to these disruptions.

For example, East Africa has experienced shortages of perishable goods and standard containers due to extended cargo delivery times, disrupting supply chains for products such as avocados, tea, and coffee.

Moreover, the shortage of empty containers, caused by carriers prioritising shipments to higher-paying markets like Europe and the United States, has come at the expense of regions such as Africa mirroring the pattern observed during the COVID-19 pandemic, mentions the report.

The Xeneta Ocean Outlook 2025 highlights how diversions around Africa affect TEU-mile demand and available capacity. While new ship deliveries and slower TEU volume growth will help alleviate some of the pressure, they won't be sufficient to offset the impact of another major disruption.

"If 2024 has been a year framed by conflict in the Red Sea, then expect more of the same because there is no sign of a political resolution that would allow a large-scale return of container ships to the region. This only heightens the danger for container shipping because there is little slack in the system to deal with another supply chain shock,” says the report.

Facilitating trade and enhancing stability

The Red Sea crisis has significantly disrupted trade across Africa, impacting one of the world’s most vital maritime crossroads. The Red Sea Crisis has sharply impacted African trade flows, disrupting one of the globe’s critical maritime pathways. The Economist Intelligence Unit reports that traffic through Africa’s Red Sea ports saw a significant decline earlier this year, with the Suez Canal handling over 95% of Asia-Europe shipping experiencing a 37% year-on-year drop in monthly transits in January 2024.

In response to geopolitical uncertainties and climate risks, Africa is working to strengthen its shipping capacity and improve trade connectivity. The report from UNCTAD mentions that Mauritius, for example, has been enhancing its resilience to various threats by strengthening national development policies and collaborating with partners within and outside Africa to improve maritime security. Its efforts include capacity building, regional training, and information sharing to address piracy risks and ensure the safety of maritime routes.

Additionally, the country is implementing port reforms focused on connectivity and sustainability to boost resilience. Across the continent, trade facilitation initiatives like the East African Community’s Single Customs Territory and one-stop border posts are being used to reduce transit times and costs.

“Our investments aim at enabling higher capacity and productivity, which not only reduce costs but also induce shipping lines to offer more and better services, resulting in improved connectivity which can further generate exports,” says van den Essen of APM Terminals.

As Africa continues its maritime transformation, the focus remains on addressing key challenges while preparing for future growth. The success of current development initiatives will play a crucial role in determining Africa's position in global trade networks and its economic development trajectory.