The Impact of Port Performance on Trade: The Case of Selected African States

Abstract

Maritime transport remains the main gateway to the global marketplace. Ocean ports are a central and necessary component in facilitating trade. Ports are essentially a channel of integration into the global economic system. Resourceful and well-connected container ports empowered by regular and consistent shipping services are key to reducing trade costs, including transport costs, connecting supply chains and supporting global trade. Consequently, port performance is an important factor that can influence countries’ trade competitiveness. However, for Africa, the ports are dilapidated, lack essential infrastructure, are congested and perform poorly. Africa’s shipping and ports do not always match global trends and standards. In light of this, this study seeks to assess Africa’s current port performance and test the relationship between Africa’s port performance and trade performance. Very few studies have attempted to investigate the impact of port performance on trade. Hence, it was worthwhile to study the impact of port performance on Africa’s trade. The study used panel data that covering the period 2005–2018. An ARDL panel technique was used for estimation purposes. Results showed that port performance positively affects trade. This study argues that African ports require expensive infrastructure to be able to compete successfully. Africa needs to pursue an intensive course of infrastructure development so as to maintain economic growth and improve port efficiency and trade competitiveness. At the moment, African ports are inefficient, and there is congestion partly because the ports cannot accommodate further expansion without serious investments.

Infrastructure and intra‐regional trade in Africa

“…A reduction in trade costs through trade facilitation will increase the volume of exports, and promote export diversification and economic transformation (Dennis & Shepherd, 2011). Mlambo (2021) also indicates that good port performance positively affects Africa's trade competitiveness. Resourceful and well‐connected container ports with consistent shipping services are likely to reduce transport costs, connect supply chains, and increase Africa's trade.…”

“…Apart from these two studies, the infrastructure‐trade‐related literature in Africa has mainly focused on various measures of the physical infrastructure to show that insufficient or sub‐standard roads, ports, airports, energy systems, and ICTs stand out as major trade barriers and hamper intra‐regional trade and to evaluate the impact of trade facilitation measures on trade flows (Akpan, 2014; Amurgo‐Pacheco & Pierola, 2008; Bankole et al, 2015; Bouët et al, 2008; Carrère, 2013; Coulibaly & Fontagné, 2006; Iwanow & Kirkpatrick, 2007; Jouanjean et al, 2015; Limão & Venables, 2001; Longo & Sekkat, 2004; Mlambo, 2021; Portugal‐Perez & Wilson, 2012).…”

Navigating prosperity: the impact of seaport efficiency on economic growth in Ghana’s maritime landscape

“…On the African continent, (Mlambo, 2021) assessed Africa's port performance, revealing a positive impact on trade (Ayesu et al, 2022;Ayesu et al, 2023). Investigated the pivotal role of seaport efficiency in shaping the relationship between trade activities and welfare outcomes in 28 African countries from 2006 to 2018.…”

Boosting intra-African trade performance: the role of maritime transport

“…In addition, the impact of business freedom on total trade was found to be positive and signi cant. Mlambo (2021) investigated the effects of port throughput performance on trade in 10 African countries namely Gambia, Liberia, Nigeria, Kenya, Cameroun, Ivory Coast, Senegal, South Africa, and Morocco spanning the period 2005 to 2018. Port throughput measured using twenty-foot equivalent units was used a proxy for maritime transport performance.…”