Pramod Bagalwadi, CEO of DHL Global Forwarding Sub-Saharan Africa
The coronavirus pandemic acted as a stress test for Africa’s logistics sector. According to UNICEF, in 2020 demand for face masks increased by more than 100 times, and the need for imported medical gloves skyrocketed by over 2,000 times. While countries around the world experienced similar issues, many in Africa experienced the most severe consequences, so it is important to come away from this crisis with lessons and opportunities for improvement. In Africa, both governments and private entities in the logistics sector can learn from the shortcomings emphasised by the pandemic and make improvements that will last long after the Covid crisis ends.
Covid era challenges
The coronavirus pandemic has highlighted a number of pain points in international logistics as governments and NGOs have worked to maintain the supply of critical imports such as medical supplies and PPE and prevent shortages of essential goods. The pandemic brought greater attention to issues with forecasting demand, international sourcing, procurement, allocation and inbound logistics and distribution.
Tracing the import chain, it is clear that a lack of coordination produced significant issues at every step. In terms of inbound transport, the limited and historically volatile freight capacity was brought to its limits by extraordinary pressure. A lack of transparency and traceability resulted in challenges obtaining reliable ETA times, which affected planning for in-country distribution.
Once the products arrived at a national border, there was often no formal system for fast-tracking the vital materials, and existing problems with supplier certification and qualification were exacerbated by the increased pressure and a shortage of staff. Import regulations changed as governments tried to address the issue, such as relaxing customs clearance procedures, but these changes were not uniform, and this produced further challenges. Further still, across Africa, countries also adopted different approaches to handling imports, making processing more complex than it could otherwise have been.
Warehousing inefficiencies also surfaced under the increased pressure brought about by the coronavirus pandemic. Limited storage capacity and a lack of formalised routines slowed supply and exacerbated unpredictability. Similarly, various suppliers each used their own proprietary stock-keeping unit (SKU) formats and shipment information formats, making the sharing of data impossible. This created a push-based outcome which meant that deliveries of essential goods were sporadic and unpredictable.
Overall, logistics obstacles resulted in major inefficiency, limiting the amount of vital resources that the healthcare sector had to work with. A lack of transparency and coordination failures among stakeholders, both private and public, revealed significant logistical issues at every level of the supply chain.
The silver lining – Covid and collaboration
The good news is that public and private partners alike have witnessed the shortcomings of the logistics status quo first-hand, and they have already begun to act. For instance, the African Union established the Africa Medical Supplies Platform (AMSP) shortly after the start of the pandemic to coordinate the international movement of medical supplies and devices across Africa.
The AMSP has partnered with multiple African airlines and global logistics providers such as DHL to take advantage of private capacity and ensure that vital products are delivered on time. By partnering with businesses that have logistics expertise, governments benefit from greater planning abilities, more consistent quality service, and a simplified stakeholder landscape. To qualify as such a business, a provider needs access to a global shipping network at scale, process excellence, a focus on data and transparency, and experience handling crises.
Public-private partnerships such as this one have proved to be critical in addressing medical supply shortages so far, and they will continue to represent an important part of the response to the Covid crisis going forward. However, we must not be content to use these partnerships as emergency measures; rather we must build upon them and make them a permanent part of the African logistics landscape.
Only through a robust system of collaboration can the African logistics sector finally overcome the long-running issues that Covid has highlighted. Private partners can deliver real-time visibility along the supply chain, something which remains extremely valuable in a post-Covid future. With modern IT systems providing up-to-the-minute information on the inventory and the movement of items, the continent’s logistics industry can begin to overcome age-old infrastructural issues and act as an engine for growth.
A collaborative future for the continent
There is cause for optimism about Africa’s future, as the continent’s governments have already begun to move in a collective, collaborative direction. Consider, for instance, the African Continental Free Trade Area (AfCFTA) Agreement. The deal, which was signed in 2018 and commenced in January 2021, progressively removes barriers between countries and makes trade easier, opening the way to greater international collaboration.
Stakeholders in the international logistics industry must understand that public-private partnerships aren’t simply a tool for managing emergencies such as the coronavirus pandemic but a powerful long-term strategy. The world that businesses and governments create in the recovery from the pandemic isn’t predetermined; it’s one that they can shape with their choices. By choosing public-private collaboration, Africa will be able to build stronger, faster and more effective supply chains than ever before. To truly reap the benefits of international trade and collaboration, Covid-era collaboration and the Continental Free Trade Area must be the first steps of many.