Angolan Port of Caio will boost economy, particularly in remote Cabinda
CONSTRUCTION of the deep water commercial harbour Port of Caio in Angola’s Cabinda enclave region has moved on a fast track since earlier this year when China’s Export-Import Bank agreed to a $710 million (R9 billion) loan facility that would see the first phase completed before the end of 2017, according to Fundo Soberano de Angola (FSDEA) chairman Jose Filomeno dos Santos.
Through an African Infrastructure fund, managed by QG Investments Africa Ltd, the Angolan sovereign wealth fund FSDEA is also investing $180m to gain a 31% stake in Caio ports.
The company was incorporated in 2012 in Luanda to facilitate and oversee the development and construction of the Port of Caio project, a major infrastructure initiative. Financial institutions are expected to provide $360m for the project, while foreign investors will contribute $60m.
Given a green light from budgeting authorities, the $1bn port development is designed to diversify Angola’s economy away from overreliance on oil and natural resource mining revenues.
It is also meant to enhance the development of Cabinda by creating jobs while also securing economic and social stability for one of the most remote regions of Angola.
When the port is completed, estimates suggest that local employment numbers will rise substantially with up to 1 600 direct jobs for the operation of the port and as many as 30 00 additional indirect jobs for people who serve the port in various capacities.
The potential annual tax revenues from operations at Port of Caio are expected to reach up to $350m when the project is finished.
Once operational, the port will offer a more direct route for oil exports and contribute to decongesting maritime commercial traffic at other regional ports.
Angola, which competes with Nigeria as Africa’s top oil exporter, produces more than 65% of its 1.7 million barrels a day from offshore areas in the Cabinda region.
The oil-rich area has had a history of economic setbacks and continues to face poverty and security challenges from low-level separatist groups.
The first phase of the Port of Caio development will include a 630-meter container terminal, shipyard facilities, warehouses, a power plant, a free-trade special zone and the Fútila Industrial Park. It’s also meant to enhance local economic growth by stimulating commerce generally, bringing new opportunities for investment, increase international trade and diversify export potential for a variety of products.
The port terminal will also increase mobility and improve access to health care, education and jobs for local communities in the isolated region, which is 60km north of mainland Angola.
In addition, the Angolan government has commissioned the purchase of two passenger ferries in the Netherlands to improve maritime links between Cabinda and Luanda.
China Road and Bridge Corporation (CRBC), the construction company contracted to build the port facilities, is required to hire local labour. This will automatically boost the region’s economy and bring additional social benefits to Cabinda.
The port is situated near the Congo River estuary and is surrounded by the Republic of Congo and the Democratic Republic of Congo. It is designed with a seawall protecting docked ships from heavy swells and a bridge linking the shore with the container terminal. Despite Angola’s challenges, Port of Caio is one ambitious step towards major improvements that have long been needed in this developing nation.
Iladi is a freelance reporter based in Virginia and covering business, politics, conflict and development in emerging markets. He has contributed to numerous publications including the Gulf News, Taipei Times, Prime-Tass, Business New Europe and iAfrica