British International Investment
12 October 2021

Answering your questions on our partnership with DP World

On 12 October, we announced a new partnership with supply chain solutions business, DP World. Here you can find the frequently asked questions on this investment.

1. What is the partnership investing in?

The partnership will focus on supporting projects to modernise and expand ports and logistics with distinct strategic importance to Africa, both at the seaboard and inland. These include seaports, free zones, inland cargo handling facilities or dry ports, and inland transport.

2. Why did CDC decide to invest in ports and logistics in Africa?

Ports are vital – they handle 90 per cent of all goods traded internationally. Stable and flourishing economies are built on reliable access to global and intra-continental trade. More efficient infrastructure and services is necessary to enable a higher volume of trade, which will in turn benefit society and local communities.

Africa’s full potential is limited by inadequate ports and logistics 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.

CDC intends to help change that. The partnership’s investments will help address the stark imbalance in global trade, accelerate Africa’s potential and improve the economic prospects of millions of people.

3. Why has CDC partnered with DP World?

DP World has more than 20 years’ experience of developing and operating ports and infrastructure, providing logistics solutions both in Africa and globally. It has a proven track record using this partnership model in other geographies with institutions such as CDPQ and NIIF. CDC’s patient capital will support DP World to do even more in Africa, and do it in a way that will further deepen our positive impact in the region.

Operational improvement is key to driving efficiencies within ports. High-quality operators such as DP World can incrementally increase capacity by identifying efficiency gains and bottlenecks to unlock, both in key pieces of infrastructure at the seaboard and inland, and in transport between these.

4. How much is CDC and DP World each putting into the investment platform?

The investment platform covers a long-term investment period. DP World is contributing its stakes in the three existing ports initially and expects to invest a further $1 billion through the platform over the next several years. CDC is initially committing approximately $320 million and expects to invest a further $400 million over the next several years.

5. Why has CDC decided to invest in Berbera?

The expansion of the Berbera port will multiply its capacity to create a regional trading hub. This will help drive much needed development for some of the most vulnerable in Somaliland and support the continuing growth of Ethiopia, which will have a positive knock-on effect on the wider Horn of Africa region.

For more information on the impact of this expansion, please see here.

6. Why has CDC decided to invest in Dakar?

The expansion of the Dakar port will add much needed capacity to West Africa, where other regional ports are already stretched, depriving hinterland trade routes of opportunity. Dakar city is choked by over 1,000 trucks entering the container terminal each day. This inevitably leads to supply chain disruptions and increases the cost of essential goods. The port expansion will support trade with landlocked Mali and help Senegal become a hub of economic activity for the region.

For more information on the impact of this expansion, please see here.

7. Why has CDC decided to invest in Sokhna?

The ongoing expansion of the Sokhna port will continue to cement Egypt’s position as a global logistics and manufacturing hub. It will support Egypt’s trade with the Middle East and Asia in particular, and the industrial growth centred around the southern end of the Suez Canal and New Cairo.

For more information on the impact of this expansion, please see here.

8. How will this investment benefit people?

Better performing trade infrastructure allows businesses to expand and to create jobs. It can improve the quality of life for millions of people by reducing the cost of living for many who currently overpay for vital imported goods.

Trade enabled by the three initial ports will support 5 million jobs in the wider economy (of which 138,000 are expected to be created by the ongoing port expansions and modernisations), and will improve access to critical goods and staples including food; this will benefit over 35 million people across the three geographies, including further afield to the wider Horn of Africa and parts of the Sahel.

9. How will this investment benefit businesses?

Modernised ports will provide a gateway to international markets for countless African businesses and entrepreneurs and support the growth of nascent export industries stymied today by logistics inefficiency. The port expansions will drive:

• Increased global and intra-continental trade volumes
• Reduced end-to-end transport costs
• Higher export value driven by increased competition
• Increased productivity for those reliant on imported goods

10. How will CDC monitor the environmental performance of the ports and push for improvements?

CDC is an active partner when it comes to addressing climate change through its investments. We will be closely involved in reviewing the environmental and climate vulnerability impact studies for each of the ports and will receive regular reporting. As the partnership develops and invests in new ports and logistics, we will seek to invest in opportunities to improve the environmental footprint and climate resilience of the ports wherever feasible.

As part of CDC’s climate strategy to decarbonise its portfolio to achieve net zero emissions by 2050, it is aligned with the Taskforce on Climate-related Financial Disclosures (TCFD).

Image courtesy of DP World.



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