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Study finds that a cargo hub at Upington would boost Northern Cape economy

2nd June 2006

By: Jade Davenport

Creamer Media Correspondent

  

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A recently completed feasibility study undertaken by Upington’s Khara Hais Municipality shows that sufficient cargo is generated in the Western and Eastern regions of South Africa and Namibia to warrant the establishment of a cargo hub at Upington in the Northern Cape.

The feasibility study was originally initiated in 2004 by business, government and labour stakeholders through the Municipal Economic Development Forum to improve the operational and financial performance of Upington Airport, which has been underused and has operated at a loss for the last decade. This is primarily owing to the fact that the airport was originally constructed in the 1970s as a refuelling point for long-haul flights to Europe and North America before 1994, when South Africa was denied overflying rights across Africa.

Since the demise of apartheid, this function has been rendered superfluous and, as a result, Upington now services the local export agricultural and fishing industries that make use of the airport’s ancillary cold-storage facilities using charter cargo flights to export fresh produce to Europe. However, Airports Company South Africa (Acsa), which has monopolistic control over all of South Africa’s internationally classified airports, has never marketed Upington Airport as a viable alternative to Johannesburg International Airport (JIA).

JIA has historically been the main gateway of airfreight cargo, but the airport has witnessed an explosion in passenger and cargo traffic in recent years. Large freighters have become a permanent feature of the aircraft landscape and volumes have increased to such an extent that Acsa is having to spend millions of rands in expansion projects. As Upington is centrally located between key South African cities, Acsa has identified this airport as a viable alternative to JIA for cargo traffic.

In addition to this, the feasibility study was undertaken to identify what contribution the airport could make to economic growth in the Northern Cape. One of the primary contributors to the Northern Cape economy is the produce sector, whereby fruit, mutton and fish are exported to Europe. As a result, it was recognised early on that an essential precondition for the airport’s succeeding would be the support of the major international airlines and key importer and produce exporter groups. To this end, Connection chairperson Gerd von Mansberg was contracted by the Khara Hais Municipality to conduct research into the potential support that the airport could secure as an international gateway.

In the first phase of the feasibility study, Von Mansberg conducted research into the major markets in the regions surrounding Upington, including the Namibian fishing industry, target aircargo airlines and the reasons for these airlines considering Upington as a viable alternative to JIA, benefits to exporters and importers, and the airport’s impact on regional economic growth. The findings of this study suggest that there is no significant difference with regard to comparative costings, as flying to Upington rather than to Johannesburg is only an additional 15 minutes.

The benefits for cargo airlines and importers and exporters would be greater when using Upington Airport, as there is less congestion and quicker airport turnaround times, shorter source-to-market timeframes – which would enhance product freshness by one day – and improved supply-chain performance. Fundamentally, the report suggests that once a regular service by a reputable airline is established, many new projects will start up and many existing commodities will grow in volume. In particular, meat exports from Groblershoop will double and Namibian meat exports will come to Upington.

Similarly, date exports will grow into new markets.

The report states that many of these projects will be suitable for emerging farmers and many jobs will be created, with the workforce being employed year round, and not only seasonally, as is customary in certain farming sectors. Most significantly, the creation of a cargo hub at Upington Airport would create a total inflow of R1,04-billion into the Upington economy. The report states that it will be economically viable to fly a scheduled service to and from Upington, although the challenge is to now entice and convince an international carrier to start such a service.

The future for freighter aircraft is not in Johan-nesburg or Cape Town, as these airports are increasingly focused on passenger services, states the report, and Upington can be a viable alternative.

However, this project will need the support of the Northern Cape provincial government, as well as the Department of Transport. Von Mansberg states that this feasibility study will be moving into the second phase within the next few months; this phase will involve soliciting and gaining the support of target airlines, including Lufthansa, Air France, Martinair, Cargolux, British Airways and MK Airlines. Upington Airport manager Esmaralda Barnes tells Engineering News that Acsa is committed to the development of this airport.

This is evidenced in that Acsa has initiated a project for the establishment of an aircraft-maintenance and -storage service, whereby older aircraft can be parked in circumstances similar to those available in dry Middle Eastern countries and the Arizona desert, in the US. Aircraft will be maintained for future use or stripped for the recycling of spare parts. “We are planning to go abroad during the month of June to pursue this initiative,” says Barnes.

“The reason why we are looking at this project is the weather conditions experienced in this region and the vast land available at the airport.

“So far we have done a market study, a spatial development plan for the airport and have identified areas for the project should it get off the ground, although this project is still in its very early stages,” concludes Barnes.
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Edited by Jade Davenport
Creamer Media Correspondent

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