CAPE TOWN PORT FACES LOGISTICAL CHALLENGES

1. (SBU) Summary. Multiple uses, lack of responsiveness to
customers, windy weather, a land-locked location and poor
planning create logistical challenges for South Africa's
Port of Cape Town. Port productivity is below
international standards and ships face excessive waits for
port access. The Port of Cape Town, enjoying a prime
location and facing increasing user demands, will find it
difficult to support this economic growth without careful
planning. End Summary.



2. (SBU) Embassy transportation officer visited the Port of
Cape Town March 21-23 to identify existing logistical
challenges to port operations. The multi-purpose port
includes facilities for pleasure yachts, ship repair and
supply, private residences, retail shopping, container and
bulk goods loading (mostly fruit), cruise liners and
storage. Conflicting demands from multiple users has made
port use planning difficult and causes logistical
challenges. The Cape Town Chamber of Commerce hosts a Port
Liaison Forum which serves as the primary means of
communicating port logistics issues. Port customers told
transportation officer that the National Ports Authority
(NPA) does not provide such a forum for hearing their
concerns and NPA is not responsive when logistical issues
are raised. (Note. NPA owns the port and provides
infrastructure. South Africa Ports Operators (SAPO)
operates the port. Both NPA and SAPO are part of TRANSNET,
South Africa's parastatal transportation company. End
Note.)



3. (SBU) Cape Town port container terminal manager Oscar
Borchards told transportation officer that high winds
caused port shut-downs for thirty days last year. When
winds reach speeds of 80 km/hr or greater, usually during
the November to May windy season, the container terminal
must shut down as a safety precaution. Although the
duration of each shut-down is normally less than 24 hours,
it causes a backlog of ships and trucks waiting to leave or
enter the port. Borchards also reported that the port is
hindered by inefficient and outmoded gantry cranes used to
load shipping containers. Most of the cranes are over
thirty years old and are not wide enough to service the
larger post-panamax ships efficiently. As a consequence,
the port's container terminal operates at an efficiency of
23 containers/hour/crane compared with an international
minimum standard of 25 containers/hour/crane. Borchards
hopes that new cranes will be purchased by the NPA and that
the productivity rate will then rise to 30
containers/hour/crane.



4. (SBU) Port expansion is hindered by its land-locked
location. The land behind the port is used for a critical
and overburdened city automobile traffic artery. Adjacent
land has already been developed into expensive residential
and commercial uses. Seven years ago NPA submitted an
Environmental Impact Assessment to extend the port sea-ward
by widening and deepening the channels, using excavated
material to extend the length and width of the container
terminal. Enlarging the port channels would also allow the
port to accommodate newer, larger ships which require
deeper passage and docking. Residents of a nearby upscale
beachfront community complained that reconfiguring the port
will cause their beachfront to be eroded by tides and
wind. NPA continues to seek approval of the project,
despite community opposition.



5. (SBU) Poor planning by the NPA was cited by port
customers as a reason for logistical challenges being faced
at the multi-use facility. Port planning in South Africa
requires that individual ports create their own plans which
then form a national ports plan, developed by the NPA.
Port customers say that these plans are kept secret. NPA's
Cape Town Port Marketing Manager Selma Schwartz-Claussen
told transportation officer that as part of the national
port plan, NPA is looking at simplifying port operations by
reducing the range of operations carried out at the port.
Schwartz-Claussen said that NPA is exploring the transfer
of ship repair and supply operations from the Cape Town
port to the Port of Saldanha, located north of Cape Town
along the Atlantic coast. Schwartz-Claussen said that
while port plans are not certain, NPA could convert the
ship repair and supply areas to create a dedicated-use
cruise line terminal and expand residential and retail

CAPE TOWN 00000099 002.2 OF 002


areas within the port. South Africa Oil and Gas Alliance
General Manager Angelo Harris said such a move would be
opposed, as the Port of Saldanha is located in an isolated
area without adequate housing, rail or road
infrastructure. Most ships being supplied and repaired in
Cape Town are oil tankers from Angola and ships must now
wait two or three days to enter the port for ship repair
and supply, according to Harris.



6. (SBU) Comment. The City of Cape Town is enjoying an
economic boom, fueled by a rapid rise in the number of
tourists and hotels and escalating property prices. The
Port of Cape Town, enjoying a prime location and facing
increasing user demands, will find it difficult to support
this economic growth without careful planning. Potential
solutions include the transfer of some port operations to
other ports such as the port of Saldanha to the north or
the new port of Coega, 20 kilometers north of Port
Elizabeth in Easter Cape Province. End Comment.

LA LIME