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Air logistics helping to drive economic growth

The rapid change in retail and trade networks caused by the global pandemic has highlighted how logistics - and air logistics in particular - is crucial to the economy.
Air logistics helping to drive economic growth

Air express delivering relief to communities in need

The first wave of lockdowns brought an urgent need for personal protective equipment such as masks, gloves, gowns, and face shields, as well as sanitising products. Given that minimal stock was held in individual countries, this meant emergency supplies had to be sent across the world as express cargo air freight.

These expedited shipments were important to protect citizens in the first wave of the pandemic. Express air logistics is not just about greater speed and convenience, but also fast and efficient cross-border customs clearance – areas where it pays to have experts of specialisation on call.

E-commerce growth driven by safety, convenience

E-commerce had previously been growing at a healthy pace, but it surged in popularity even further during the lockdowns. Ordering online and having the product delivered to your door was the smart option for those focused on their health and safety, and in many cases courier delivery was also practical for people stuck in their homes.

For many, e-commerce became their preferred method of shopping.

Connecting businesses on the continent to new markets, opportunities

On a broader scale, air express has a major role to play in helping to drive economic growth in Africa.

As an African Union trade plan notes: "A key feature of Africa’s trade … is its high external orientation and relatively low level of intra‐regional trade."

The proposed African Continental Free Trade Area (AfCFTA) trade pact, identified by the World Bank as a major opportunity for countries to boost growth, reduce poverty, and improve economic inclusion.

If implemented fully, it’s projected that the trade pact could boost regional income by 7% or $450bn, speed up wage growth for women, and lift 30 million people out of extreme poverty by 2035.

This kind of trade-driven growth will be important to not only help African economies recover from the impact during the pandemic, but provide new markets for business growth, a particular opportunity for the micro and small business sector which make up around 80%3 of Africa’s business environment, around 44 million micro, small, and medium enterprises in sub-Sahara Africa alone.

The World Bank says5 that for this to happen, it "will require a determined effort to reduce all trade costs". This means simpler trade legislation, but also logistics that is straightforward and efficient.

A clear choice for speed, special handling, or specialised products

Air freight will play a powerful role. In fact, it already does. According to Iata, despite lockdowns and border closures across the continent, Africa’s air cargo volumes rose 1% during 2020.

Today, air cargo transports around $5.6t worth of goods – around 35% of world trade by value, but representing 1% by volume. When speed and service are important, air freight is the choice.

Air express is perfectly placed to support businesses from major e-commerce platforms to small businesses looking to expand to their first cross-border market. In turn, this access stimulates growth and local economies – here in South Africa, and across the continent.

Partnering with an experienced courier and logistics organisation can make entries to new markets work on your terms, and business looking to trade across Africa and the rest of the world should consider air freight and logistics as an essential part of their growth strategy.

About Natasha Parmanand

Natasha Parmanand is Managing Director, Operations sub-Sahara Africa, FedEx Express.

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