DP World partners with CDC Group to invest in ports and logistics across Africa
Dubai-based DP World and the U.K.'s CDC Group have created an investment platform to develop ports in Africa.
The platform covers a long-term investment period. DP World is contributing its stakes in three existing ports initially (Dakar in Senegal, Ain Sokhna in Egypt and Berbera in Somaliland), and will also invest a further US$1 billion through the platform over the next several years.
CDC is committing approximately US$320 million initially and expects to invest up to a further $400 million over the next several years. The transaction is subject to certain final regulatory approvals.
The platform will invest in origin and destination ports, inland container depots, economic zones and other logistics across Africa to increase trade, create new job opportunities and broaden access to essential goods. It will initially be seeded with minority stakes in existing DP World assets with significant capacity expansion plans, including Dakar (Senegal), Sokhna (Egypt) and Berbera (Somaliland). Trade enabled through the ongoing expansions is expected to create an additional 138,000 employment opportunities in the wider economy. By 2035, the ports are expected to support stable employment for around 5 million people indirectly.
An exciting partnership is born between @DP_World and @CDCgroup, demonstrating our long-term commitment to investing in Africa, bringing much-needed investment in infrastructure – critical for economic growth across the continent.https://t.co/YNSvhwH8U5 pic.twitter.com/ZVmO0IUtyw— DP World (@DP_World) October 12, 2021
DP World has more than 20 years of experience developing and operating ports and infrastructure and providing logistics solutions in Africa and globally. This transaction is aligned with DP World's strategy of partnering with organisations that offer complementary expertise and have a shared vision for enabling trade and driving economic and social development.
CDC is the UK's development finance institution and impact investor with over 70 years of experience successfully supporting the sustainable, long-term growth of business in Africa and South Asia. CDC is owned by the UK Government and has a dual objective to deliver development impact by supporting business growth that lifts people out of poverty and makes a financial return.
Sultan Ahmed bin Sulayem, Group Chairman and CEO, DP World, said: "We are excited to announce a partnership with CDC Group that will enable increased investment in ports and logistics infrastructure across Africa, driving efficiency and trade growth. The partnership will create transformational opportunities for tens of millions of people over the next decade.
"In CDC, we have found a partner with whom we share the common goal to invest in the long term and help build responsible and sustainable infrastructure in Africa, which is key to unlocking the trade potential of the continent.
"DP World is committed to Africa for the long-term and sees significant opportunity for future growth across the continent. The partnership with CDC offers the flexibility to accelerate and capitalise on these opportunities.
"By combining our in-depth knowledge of ports and logistics and CDC's expertise in infrastructure investment in Africa, we can drive greater supply chain efficiencies, provide improved trade connectivity and ultimately enhance value for all stakeholders."
Nick O'Donohoe, Chief Executive Officer, CDC, added: "Stable and flourishing economies are built on reliable access to global and intra-continental trade. Africa's full potential is limited by inadequate ports and trade bottlenecks, putting the brakes on economic growth in some of the world's fastest-growing economies and undermining social resilience in the least developed parts of the world. This platform will help entrepreneurs and businesses accelerate growth with access to reliable trade routes, and it will help African consumers benefit from the improved reliability and reduced cost of vital goods and food staples.
"We are proud to support DP World to do even more in Africa, charting a stronger course for African trade around the world."
Top Photo: Port of Berbera, Somaliland (Jyusuf | Wikimedia Commons)