The Bolloré-Maersk consortium’s eviction from the container terminal in December 2020 and the ongoing litigation, which has been widely publicised, may lead one to believe that this disqualification of foreign operators was a one-off event.
However, a nationalist groundswell has indeed been sweeping through the Cameroonian economic capital’s port complex ever since Cyrus Ngo’o was made the head of the autonomous Douala port (PAD) five years ago. In October 2020, this trained civil administrator announced the return of the “state of Cameroon’s sovereignty over the main access route for goods and merchandise in the country.”
New agencies and companies
Under his leadership, a number of activities that were carried out by foreign companies – in line with the 1998 port reform which, among other things, established private operations – are now managed by local companies. Several of them are supervised by the port authorities. “As was the case before, when some activities were even directly operated by the former Office National des Ports du Cameroun [ONPC], the PAD’s ancestor,” says Lin Onana Ndoh, deputy director of the company in charge of towing and salvaging ships, which was established at the beginning of 2021 to replace the French company Boluda.
For the past two years, the delegated company has also been responsible for managing the container terminal, which was previously the responsibility of Douala International Terminal (DIT, a subsidiary of the French company Bolloré Transport & Logistics and the Dutch company APM Terminals), through the Régie du Terminal à Conteneurs (RTC). It has also taken over the dredging activities previously operated by China Harbour Engineering Company (CHEC), as well as safety and security, for which a new entity has been created: Douala Port Security (DPS). This takeover was possible thanks to financial support from Afriland First Bank, which made lines of credit available to the port authorities to start their activities.
Another mechanism used was concession. This is the case for stevedoring, for which an agreement was signed last year with Fako Ship, one of the entities of the family group founded by Charles Namme Menyoli and established in Buea, in the South West region. It led to the creation of Douala Mooring Company (DMC), the project company in charge of the activity. The only exception to this rule is the concession for the timber yard’s management, which was concluded before Ngo’o’s arrival and remains a part of Bolloré group.
Countering multinationals’ blackmail
Public-private partnerships, including with foreign operators, are not excluded. For example, the Turkish company Erdem, financed by Afriland First Bank, will invest 15bn CFA francs [€22.87m] in the coming months to build 13 warehouses. Erdem has already created the Société de Gestion des Magasins Portuaires (SGMP) to ensure that these warehouses will be operational when the time comes.
The article continues below
Get your free PDF: Top 200 banks 2019
The race to transform
Complete the form and download, for free, the highlights from The Africa Report’s Exclusive Ranking of Africa’s top 200 banks from last year. Get your free PDF by completing the following form
For a long time, certain jobs were left to foreign operators who had the necessary tools, such as security – now entrusted to DPS – and weighing goods entering and leaving the port. This task has now been devolved to Douala Port Weighing Services (DPWS), which signed a 20-year operating agreement two years ago. “Since then, we have set up a network of weighbridges that are open to the public in the port area and capable of handling all the traffic,” says DPWS’ president Lucien Ndzomo Mviena.
In addition to the PAD’s stated intention, some renationalisations are the result of disagreements between the port authorities and the concessionaire regarding the specifications at the time of negotiations, which were supposed to lead to a contract renewal. “In this case, when the previous service provider could not convince the PAD of the need to reduce operating costs and maintain investments,” says Ndoh. According to Ngo’o, Cameroonising activities also makes it possible to counter “certain multinational companies’ persistent blackmail to stop work.”
The first impact of this PAD policy is the savings made across the port activity’s various segments. One of the best examples is the disappearance of head office costs, which the parent company charges to its subsidiaries and have an impact on the result, as well as better control over salary costs, resulting from expatriates’ departure.
Cameroonisation has also brought down costs. “Dredging represented 30% to 40% of the PAD’s operating costs, which is considerable. To dredge 3.7 million m³ of tailings, we were spending nearly 10bn CFA francs per year. We have reduced this cost to less than 4bn CFA francs per year for the same quantity treated,” says Idriss Beye, the dredging authority’s deputy director. Similarly, in terms of security, installing DPS and its video surveillance system has considerably reduced the number of larcenies suffered by the various operators. “This has prevented us from stealing fuel, which our predecessor deplored, and we have therefore been able to make significant savings,” says Ndoh.
The dynamics set in motion have thus helped increase the PAD’s income and the resources needed to make the investments required to renovate the infrastructure and acquire new equipment. With a turnover of 56.8bn CFA francs for 2021 – up 14% from the previous financial year – the Régie du Terminal à Conteneurs (RTC) is expected to make a profit of more than 15bn CFA francs.
The net result of its more modest sister company specialising in towing is estimated at around CFAF 1bn, which translates to CFAF 4.3bn (up 23%) in revenue. Add to these resources a collection of fixed and variable royalties, which are increasing overall across the various businesses. In addition, the contract signed with the Swiss company Pukaly to reevaluate dredging residues guarantees an income of 45bn CFA francs for the next 15 years.
These initial satisfactory and promising results are already being replicated in the region’s other ports. For example, one of the dredgers that the PAD has recently acquired will leave in April to stay in the Congolese port of Pointe-Noire so that it can evacuate 1.7m tonnes of sand in order to facilitate maritime access. “We are even studying requests from Venezuela and Colombia,” says Beye.