Transportation & Logistics Analysis

Tanger Med: a troublemaker in the West African hubs game

January 07 2020

DOSSIER. By opening Tanger Med in 2007, Morocco has upset the ambitions of West African ports in their race to become regional hubs. Faced with its competitors in the Dakar-Luanda range, Tanger Med has succeeded to assert itself, but above all for the operators that have an ownership stake in its terminals.

West Africa was seen by container handling operators as an El Dorado in the 1990s and early 2000s. Previously the preserve of the French group Bolloré, West Africa has turned into a playing field for these operators. DP World has laid the groundwork in Dakar and China Merchants in the port of the Nigerian capital, Lagos.

At the same time, the shipping companies followed suit and have come to upset the handlers' game. The CMA CGM group signed an agreement in 2018 with Nigeria to become the future port of Lekki's operator. As for APM Terminals, a subsidiary of the Mærsk group, it has joined forces with the Bolloré group in several ports. Together, they are present in major terminals such as Abidjan, Téma and Kribi. MSC is not to be outdone. The Italian-Swiss shipping line's strategy, developed in the 1990s, was concretized when it acquired the management of the Lomé terminal.

A successful strategy

In the context of ports managed by large containerization groups, Tanger Med has sought to find its place. The strategy of TMSA (Tanger Med Special Agency) has been to concede the terminals to operators who could not only bring in significant traffic to these terminals, but also allow the port to become a hub towards Africa. A strategy that has paid off since the arrival of Maersk, CMA CGM and by way of alliance, Hapag-Lloyd and its partner in Africa, the Turkish group Arkas, boosted the traffic through Tanger Med. Today, the port in the Strait of Gibraltar ranks first among African container ports. Located at the crossroads of the north-south and east-west routes, Tanger Med is well placed to play a role in transshipment.

Admittedly, shipping a container from Asia or America to West Africa via Tanger Med has not yet become the norm. Companies like MSC have chosen to rely on regular direct lines from Asia and Europe to West Africa and in particular to the port of Lomé, which plays the role of the point of transshipment for the region. As for links with America, they use the shipping-line hubs close to Africa such as Valence or Las Palmas. A strategy that means they are not dependent on transshipment in Tangier.

A clear head start

However, Tanger Med still has a clear lead over its competitors on the western coast of Africa in the transhipment activity. According to a study published by Jeune Afrique in July 2019, this type of traffic reached 1.4Mt (or approximately 140,000 TEUs) in 2018 in the port of Lomé. In the Republic of the Congo, in Pointe-Noire, the second largest port for transhipment traffic, the containerized hub function generated 7.7Mt, or some 770,000 TEUs. These figures are extremely low compared to Tanger Med's transhipment traffic which represents, year in year out, almost 90% of the total (3.47 M TEUs in 2018).

If the volume of transhipment is not only intended for West Africa, with part going to Europe and the Mediterranean, the figures demonstrate Tanger Med's ability to assert itself in Africa.

Located close to cities, West African ports have little space to provide anything other than simple handling. In addition, there are significant congestion problems for the evacuation of containers. The port of Tanger Med has been able to overcome these handicaps by installing its terminals in areas with enough space to add logistics areas to them.

Another role for West African ports

Today's West African ports have above all a vocation to be gateways for local traffic both entering and leaving them. They are also the maritime links for the region's landlocked countries. Burkina Faso, Mali, Chad, Niger and the Central African Republic would be unable to open up to the world without the maritime and land links that are ports.

This situation will change, with the entry into service of future terminals, such as Lekki in Nigeria, Abidjan’s second container terminal, the Port du Futur in Dakar or with the planned construction of a new terminal in Angola. The new terminals should be built further away from the cities so as to offer greater availability in terms of storage space and not suffer from the restrictions of urbanization.

We can therefore be reasonably optimistic for the main ports on the West African coast, which will play the role of hubs but on a more regional level, with the exception of those "chosen" by shipping companies such as Lomé for MSC or Pointe Noire and Kribi for CMA CGM. The rest will become smaller regional hubs for both landlocked countries and other ports with less traffic. In this way, Dakar, to take an example, could play a role for countries like Gambia, Guinea Bissau, the southern parts of the region such as Casamance, Liberia or Sierra Leone and maintain its relations with Mali, Niger and Burkina Faso. Abidjan, Tema and Lagos will be gateways to northern countries such as Burkina Faso, Niger and even Chad while occupying a place in the distribution of boxes with neighboring countries.

In this context, if Tanger Med has not yet won the hub war in West Africa, we can consider that it has won several battles. By having the main shipping lines as operators of their terminals (Maersk, CMA CGM and MSC, even if the latter does not use it), by opening logistical zones behind the terminals, and by virtue of its geographical location at the crossroads of maritime routes, it has a solid base in the war that is looming. The proliferation of projects does, however, give rise to a significant threat of overcapacity of container terminals in the region.

Photography: Herve Deiss

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Graduated in law, Herve Deiss joined the transport, logistic and shipping press more than 20 years ago. From over these years, he has developed a specific expertise in all ports systems around the world
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