CHAPTE ONE

INTRODUCTION

1.1 Background to the Study

The global transportation infrastructure stands at a crossroads, facing a critical juncture that demands immediate attention and transformative action (Odimarha et al., 2024). Transport infrastructure plays an important role in the national economy, especially in an open and globalized economy. Port activity is no longer limited to just cargo handling; logistics service provision in an international context has become a core part of the business which requires high infrastructure to facilitates cargo delivery on the right destination on time (Cullinane & Wang, 2006). Despite such significance, the impacts of port infrastructure quality and cargoes delivery performance on a country’s trade and economy have been largely overlooked in the existing port economics.

Globalisation has given ports a more complex and essential role as they have become more integrated into the global supply chain, which has extended their function as just a hub for cargo handling (Munim & Schramm, 2018). This has made the ports become a crucial link that connects the global supply chain with regional production and the consumption market, which has extended their function as logistics providers (Notteboom et al., 2022). The extended role of the port has put more pressure on the port performance as factors such as “lean” and “just in time” production within the supply chain is dependent on reliable and predictable deliveries (Munim & Schramm, 2018). Therefore, the ports capability of performing in an effective and efficient way determines to what extent they can compete in the global supply chain and be a part of the international trade market (Cullinane, 2017).

According to Notteboom et al., (1997) investments in physical infrastructure creates a better business environment and improves transport efficiency, which facilitates export growth and cargoes delivery on times (Portugal-Perez & Wilson, 2012). According to Yeo et al. (2008), the quality of port service, logistics costs, regional connectivity, hinterland condition and port accessibility, contributes significantly to a port’s competitiveness. Similarly, Notteboom et al. (1997) stated that a combination of infrastructure quality, hinterland accessibility and productivity plays a vital role in strengthening a port’s competitive position. Gordon et al., (2005) added that a combination of port facilities, including sufficient investment, supportive government policies, excellence in operation and information technology, can help a port attain sustainable competitiveness, which will produce higher seaborne trade compared to the less competitive ports.

Quality of infrastructure and transport costs are important for export-led economic growth (Limao &  Venables, 2001). Thus, it can be derived that efficient ports have better quality infrastructure and logistics performance than inefficient ones. Additionally, an efficient port system with enhanced logistic abilities is a key determinant of foreign direct investment into a country (Panayides et al., 2015). On the other hand, inefficient ports reduce national and international trade and affect economic growth adversely (Clark et al., 2004).

In the world context, many countries are planning to build up regional hub ports infrastructure, following successful cases such as Singapore, Shenzhen, Hong Kong, Dubai, to name a few and expecting additional growth of their economies in forms of new service markets. This could be aided by developing transshipment infrastructure facility and efficient transport network. However, the port–city relationship has changed and the urban structure of cities is no longer important for explaining the intensity and spatial distribution of maritime transport networks (Ducruet et al., 2016). Due to structural changes in the global shipping industry, neither a port’s throughput projection nor its economic contribution performs with the degree of certainty expected by the planners (Hesse, 2006).

In South America, and Eastern Europe, port infrastructure quality and cargo delivery on seaborne trade, their results revealed that it is vital for developing countries to continuously improve the quality of port infrastructure and logistics performance to increase seaborne trade. In South America, and Eastern Europe, it is estimated that the effect of custom related delays on the Uruguayan firms’ exports; their results suggested that delays have a significant negative impact on firms’ exports, especially in sales to newer buyers and this as result of poor port infrastructure. However, lacking of a direct maritime connection with a trade partner is associated with lower values of cargo delivery in South America, and Eastern Europe.

Africa still makes up just a small percentage of global trade, with problems persisting at its ports from performance issues to inefficient handling time, poor security and in some places, corruption (Kingsland, 2020). Africa needs to make the use of the economic potential of its ports and shipping sector if it is to realise its growth ambitions. An analysis by the PwC revealed that a 25% upgrade in port efficiency may increase growth by 2%, demonstrating the close relationship between port effectiveness and trade competitiveness (Booth, 2018; Niselow, 2018). However, with increasing congestion in several African ports, Africa faces the risk of foregoing further growth through poor or little investment in port terminal infrastructure. Access to effective ports, interconnecting infrastructure and efficient operations to cope with current demand and future growth could lead to reduced costs and improved overall freight logistics efficiency and reliability, all of which are fundamental to the region’s future success (UNCTAD, 2019). It is against this background that this study engages in an investigation of the impact of port performance on trade. Considering the current state of ports in Africa it is important to embark on a study on how port performance affect trade.

In Cameroon, the causes of delay which customs procedures, transport around the Unban area, loading and unloading of cargo at the port. The solutions as per these challenges are hastening customs procedures, reduction in customs procedures. The weight of cargo carried by trucks should be regulated in order to reduce traffic in and around the port. Also, reduction in customs procedures would enable proper cargo handling. The delay faced by most Douala Seaport is as a result of language barriers between customers and workers also less implementation of JIT by the firm. Also reducing the weight and number of trucks in and around the port at the same time will reduce traffic and also and also hastening the arrival of cargo at customer’s warehouse which fulfills the purpose of port transportation as part of cargo handling. Therefore, this study seeks to investigate Port Infrastructure and Cargo Delivery at the Douala seaport.

1.2 Statement of the Problem

Ports create a direct gateway for a country into the global trade by serving as a direct link to the maritime transport which carries more than 80% of world trade in terms of volume and is considered the lifeblood of the world trade (Stopford, 2009). Ports, therefore, have a significant economic function for a country as it facilitates international trade and the exchange of goods with other nations. This is important as trade positively impacts economic growth for developed and developing countries (Were, 2015). Ports are also seen to have other positive economic effects, such as attracting new industries, companies, investors and generating employment near them (Mudronja et al., 2020). Which from a historical perspective has developed seaports into more economically advanced cities within a nation (Shan et al., 2014).

That ports fulfill a vital function for a country by contributing to increased trade and economic growth has been acknowledged in previous academic research. However, the contributing effect that port infrastructure and logistics performance have on a country’s trade and economic growth has not gained the same attention. Although research has been made in the field and has been able to see a positive relationship between port infrastructure quality, logistics performance on trade and economic growth, these studies have largely focused on a single country or a region. Less focus has been given to the overall effect that port infrastructure quality and logistics performance have on a country’s trade and economic growth, by considering multiple countries in the research. Which makes it hard to get a predictive and general overview of the effects that quality of infrastructure and logistics performance has on a country even if such signs exist.

The lack of a predictable overview of the effect of quality port infrastructure and cargoes delivery performance can be problematic as the majority of investments in ports are made with the help of tax money. Investments in improved port infrastructure and logistics are generally expensive investments. Today however it is difficult to predict what contributing economic impact such investments have for a country. The combination of a missing predictive overview of the economic effect of investment in port infrastructure and the vast amount of tax money that is needed for such investment may cause such investments to be questioned by the public, politicians, and investors. The generally the port of Douala is still faced with some challenges in term of infrastructure which has resulted to delays in cargo handling and increased costs for businesses using the port. Despite these challenges, improving port infrastructure remains crucial for enhancing trade efficiency and economic growth in the region. Therefore, this study seeks to investigate Port Infrastructure and Cargo Delivery at the Douala seaport, Cameroon.

1.3 Research Questions

1.3.1 Main Question

What is the effect of Port Infrastructure on Cargo Delivery at the Douala seaport, Cameroon?

1.3.2 Specific Questions

• What is the effect of warehouse on Cargo Delivery at the Douala seaport, Cameroon?
• What is the effect of machinery on Cargo Delivery at the Douala seaport, Cameroon?

1.4 Research Objectives

1.4.1 Main Objective

To examine effect of Port Infrastructure on Cargo Delivery at the Douala seaport, Cameroon.

1.4.2 Specific Objectives

• To investigate the effect of warehouse on cargo delivery at the Douala seaport, Cameroon.
• To analyze the effect of machinery on cargo delivery at the Douala seaport, Cameroon.

1.5 Research Hypotheses

1.5.1 Main Hypothesis

Port Infrastructure does not significantly affects cargo delivery at the Douala seaport, Cameroon.

1.5.2 Specific Hypotheses

• Warehouse does not significantly affects cargo delivery at the Douala seaport, Cameroon.
• Machinery does not significantly affects cargo delivery at the Douala seaport, Cameroon.