- Positioning to be Africa’s Transport and Logistics Champion
- Strategic partnership with Germany’s Deutsche Bahn
Thelo Group, the African transport and logistics solutions provider for freight owners, has announced the expansion of its offering to deliver integrated (rail, port and rolling stock), multi-freight, multi-user transport corridors to efficiently move Africa’s valuable resources at economies of scale. These resources are largely mining commodities, agricultural produce, containers and bulk liquids.
Thelo’s offering of interconnected transport corridors is in response to Africa’s transportation challenges and a strategic move to support Africa’s Continental Free Trade Area (AfCFTA)’s single market. As a result of AfCFTA[1], the transport sector is expected to expand by nearly 50%, significantly boosting intra-African trade. But its success hinges on improving Africa’s road, rail and transport infrastructure; a challenge that Thelo is actively addressing. Currently, transportation costs related to logistics in Africa are up to 75% higher than in other parts of the world[2].
Mr Ronnie Ntuli, Chairman of Thelo Group, said: “We are mobilising capital from investors in Africa and internationally, and leveraging world-class engineering and operational capacity to create large-scale interconnected transport and logistics corridors for Africa. As an independent African company, Thelo is playingan instrumental role in developing, operating and managing national and regional development corridors.
“Importantly, Thelo’s multi freight, multi-user approach will deliver more efficient transport solutions to multiple freight owners at economies of scale that will reduce transport and logistic costs.”
Thelo Group, bolstered by its strategic partnerships, stands out as one of the rare African entities with the capability and expertise to execute large-scale infrastructure projects across the entire delivery value chain. This includes planning, design and engineering, EPC oversight, testing and commissioning, training, operations and maintenance management.
Mr Ntuli continued: “Our skills, capacity and years of experience in this sector, together with our deep understanding of Africa’s transport and logistics infrastructure market sets us apart and gives us a leading advantage.”
“By bringing world-class global expertise and capacity to the African railway and ports sector, we are the right strategic partner for investors in Africa’s transport and logistics sector.”
In order to enhance its delivery model, Thelo will transform its relationship with DB Engineering & Consulting (DB E&C), a subsidiary of the Deutsche Bahn Group A. G. (DB), from an equity joint venture to an exclusive strategic partnership. DB E&C will be Thelo’s technical partner across sub-Saharan Africa to develop, manage and deliver engineering, technical and consulting capacity, as well as to enhance the operational efficiencies of Thelo’s railway sector projects.
Stefan Geisperger, Managing Director for International Markets at DB Engineering & Consulting, said: “Our global and long-standing experience and expertise in the railway sector, coupled with our ongoing valued relationship with Thelo, is crucial for delivering on Africa’s critical need for integrated transport infrastructure. Deutsche Bahn remains firmly committed to our partnership with Thelo in Africa under our newly restructured and exclusive partnership.”
Commenting on Thelo’s partnership with Germany’s Deutsche Bahn, Mr Ntuli said: “Thelo is honoured by DB’s continued commitment to our partnership in the sub-Saharan region of Africa and we are thrilled to continue working together on an exclusive basis with arguably the world’s leading fully intergrated, global railway conglomerate. With the Group’s depth of global experience and expertise, built over 180 years in the mobility sector, DB is the best partner for Thelo to work with in developing integrated transport and logistics infrastructure on the continent of Africa.”
With trains operating in multiple jurisdictions in Southern Africa, Thelo has, over many years, built its capacity internally for Thelo Rolling Stock. The Group continues to finance rolling stock (locomotives and freight wagons) through lease arrangements with rail operators and freight owners. It is advancing negotiations to establish strategic partnerships for its ports vision.
The company’s strategic vision is to spearhead Africa’s transport and logistics, support the continent’s long-term growth and economic development, and to drive socio-economic progress by connecting rural communities in agriculture and mining rich areas.
The scale of Africa’s transport and logistics challenges are evident and, the establishment of the AfCFTA is expected to increase intra-Africa trade by 81% by 2035[3], emphasising the vital importance of various transport modes, including rail, ports and rolling stock. As a result of the AfCFTA[4], the transport sector is expected to expand by nearly 50%. Compounding the scale of Africa’s challenge, the African Development Bank estimates that road, air, rail and port infrastructure requires investment of US$35 to $47 billion per year[5].
Most of Africa’s freight is bulk commodities from the agricultural and minerals sectors including strategic minerals for export. However, the continent’s current rail transport network is dilapidated, resulting in lots of stranded freight. National operators also lack sufficient capacity to move freight, leading to a huge reliance on trucks and the road network, which transport 80% of goods. Thelo Group’s rail transport and infrastructure development projects aim to address these issues, offering a more efficient and cost-effective solution that will significantly reduce the reliance on trucks and improve the overall transportation of goods.
Thelo Group enjoys partnerships with the Industrial Development Corporation (IDC), which has 10% ownership of Thelo Rolling Stock, and a Memorandum of Understanding with the African Export-Import Bank (Afreximbank), which, in alignment with its pillar of financing trade enabling infrastructure, is acting as mandated lead arranger and adviser for Thelo’s rail corridor and infrastructure development projects.
Thelo is building closer links with governments and other stakeholders, offering a reliable partner to secure long-term development and operational rights.
The company showcases its transformational transport and logistics capabilities, backed by a proven track record, to development finance institutions, multilateral finance institutions, export credit agencies and banks. Thelo also extends its collaborative relationships with large mining companies, agri-producers, freight owners, shipping and transport companies.
[2] AfCFTA’s Potential Solutions in Solving Africa’s Logistics Challenges (brickstone.africa)
[3] Trade Pact Could Boost Africa’s Income by $450 Billion, Study Finds (worldbank.org)
[5] African Economic Outlook 2018 (African Development Bank
