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The main crossing point for cargo

The Port of Réunion is located on the northwest coast of the island. It is a port of national interest under a Government concession to the Chamber of Commerce and Industry of Réunion (CCIR). This multi-function port (trade, fishing, marina, military activity…) is the main crossing point for cargo.

It comprises two sites which are 3 km apart: the industrial and commercial port is in the east and the historic site is in the west next to the city center.     

Since 2004, the Port of Reunion has been implementing a program to extend and modernize its facilities in order to adapt to the increase in the size of ships and traffic volumes and play a major role in regional sea trade. The major issue for the Western Port is to develop the port in a manner consistent with the development of the Port municipality by creating new service and leisure activities and maintaining certain port activities (fishing, marina and cruises).

Increased terminal capacity and creation of a basin marina

In April 2012, AFD signed an €11m financing agreement with the CCIR to finance the Port of Réunion’s investments to extend and deepen the container terminal basin, increase the terminal’s capacity and create a basin marina.

The Eastern Port porticos, © J. Couriaut
 

Scaling up regional and international integration

This financing will promote Réunion’s integration in international and regional trade by reducing waiting times for vessels and freight costs for goods and by increasing the stock turnover rate. The expansion of facilities for pleasure craft will bring economic benefits with the increase in the number of ship repairs, water sports and various commercial activities.

The Port of Réunion’s activity is mainly based on import flows (86% of the total traffic in tons) for the island’s own needs. There is a low level of transshipment activity due to the fact that Port-Louis has comparative advantages in terms of costs and storage area.

The main aim of the works conducted at the Port of Réunion is to raise the mooring capacity, particularly for container ships, and reduce waiting times. The extension of the quays will make it possible to moor two container ships at the same time (against one today).

The objective for the fishing activity is to develop the local supply sector. The fishing basin was indeed delivered in 2009 at the West Port, but the works on the superstructures (workshop, cold store…) need to be conducted on the West Port.

Regional maritime activity is expected to develop with the increased trade between Africa and Asia. In this regard, and despite the fact that Mauritius aims to be a hub in this area, the Port of Réunion is seeking to play a complementary role to Port-Louis. This will only be feasible if its facilities and infrastructure are modernized.

President Goodluck Jonathan, Henri de Raincourt, French Minister of Cooperation, Ngozi Onkonjo-Iweala, Nigerian Minister of Finance, and Didier Mercier, Deputy Chief Executive Officer of AFD, marked their visit on 25 November by signing the first financing agreement between the Nigerian State and AFD. This $100m loan will finance the construction of a rapid bus line, which will reduce congestion in the City of Lagos.

Lagos is a coastal city located in the southwest of the country. Today, it is the most densely populated city in Sub-Saharan Africa, with over 15 million inhabitants and an annual growth rate of 6%. Its infrastructure network and transport services are sized for a city of roughly 6 million inhabitants, i.e. its population in the 1980s. Urban congestion has become a major challenge for the city. It affects both the cost of producing and distributing products and the quality of life of its residents.

First operational example of an integrated and coherent approach to improving public transport in Sub-Saharan Africa.

Back in 1992, Lagos State set out to tackle this situation by conducting an extensive sectoral and institutional study. In March 2008, its action led to the launch of a Bus Rapid Transit (BRT)-Lite system, which will create a rapid bus service running on exclusive right-of-way lanes. It is the first operational example of an integrated and coherent approach to improving public transport in Sub-Saharan Africa.

AFD has been operating in Nigeria since 2008 and has made urban development one of its priorities in the country, in partnership with the Nigerian authorities. The financing agreement signed today is for a $100m loan to the Federal Republic of Nigeria, which will be reallocated to the Federal State of Lagos. It is part of the second Lagos Urban Transport Project (LUTP II), which amounts to $329.5m and is cofinanced by the World Bank and the Global Environment Facility. AFD is financing one of the two planned corridors, i.e. the 22 km corridor linking up the communities of Oshodi, Mile 12 and Ikorodu. This section, which will link up downtown Lagos with the northeast of the State, is considered to be a priority by the local authorities.

The urban transport project has been hailed internationally a success and makes a major contribution to the plan to develop sustainable cities in Sub-Saharan Africa.

►Download the Annual Report 2010 in French (PDF)

2010: a new year of growth to support development

With €832 million of budget resources allocated by the State, AFD provided €6.8 billion of project financing in 2010, i.e. an 11% rise on 2009. Its activity accounted for 28% of France’s official development assistance. AFD also paid back €104 million of dividends to the State.

Africa remains the priority with €2.1 billion of financing in 2010.

Two-thirds of the financing break down between infrastructure, urban development, productive sectors and agriculture.

In 2010, AFD’s financing will contribute to:

• Improving drinking water supply systems for 33 million people
• Getting 13.4 million children into primary school
• Upgrading or building transport hubs that will be used by 85.8 million passengers a year
• Supporting energy efficiency by saving 5 million tons of CO2 a year
• Providing access to electrification for 3 million people
• Allocating microfinance loans that will benefit just over 700 000 people
• Supporting agricultural or irrigation projects that will benefit 1.4 million people

2011: consolidation of economic model

Dov ZERAH, Chief Executive Officer of AFD: “AFD has experienced a veritable revolution over the past few years. It has become a key player in development with an activity that has tripled in five years. Today, a new phase is beginning with the consolidation of our model.”

In the coming years, AFD will be focusing its activity on three priority areas:

• Sub-Saharan Africa:  60% of resources allocated to AFD by the State will be earmarked for this region, particularly for the sectors of agriculture and agro-industries, infrastructure, education and health.
• The Mediterranean: AFD will be supporting the recent developments in the region by scaling up its operations in Mediterranean Basin countries, particularly in the productive and vocational training sectors.
• Emerging countries: AFD will be supporting these countries via loans with a low level of concessionality in order to encourage them to set out on a growth path that respects the environment more and is more inclusive.

Consolidating the model requires stabilizing AFD’s level of activity, which is expected to reach €8 billion by 2013. AFD set up a Risk Department in 2011 in order to improve risk management. It has also reinforced its human capital with 125 recruitments in 2010.

Dov ZERAH: “Beyond financing, it is our expertise that our partners are seeking. AFD will also be continuing to actively provide input to international debates through its knowledge production. We will, at the same time, be forging an increasing number of partnerships with other development players such as NGOs, local authorities, private foundations, or again multilateral banks. They help increase the outreach and effectiveness of our actions. In a globalized world, the only winning strategies are cooperation strategies.”

In 2011, AFD will be celebrating the 70th anniversary of its creation in 1941 by General de Gaulle. AFD will be marking the occasion by organizing events to meet the French public in order to raise their awareness of North-South issues and allow them to learn more about development results. A travelling open-air exhibition called “Objectif Développement”, designed in partnership with Magnum Photos, will be launched in Bordeaux on 21 May 2011. It will be travelling to all the major cities in France throughout the year.

 
Agence Française de Développement (AFD) is a public development finance institution that has been working to fight poverty and support economic growth in developing countries and the French Overseas Communities for 70 years. It implements the development policy defined by the French Government.
With agencies in over 50 countries, AFD finances and supports projects that improve people’s living conditions, promote economic growth and protect the planet: getting children into school, support for farmers and small businesses, water supply, tropical forest preservation, fight against climate change…

The financing of these systems (operating and investment costs) cannot be covered by the income from fares and subsidies alone. In a wide range of local and national contexts, many original mechanisms have been developed for which goal remains the same: the continual and efficient development of urban transportation and its sustainable adaptation to the city’s growth.

The handbook, created by the French Ministry of Ecology, Energy, Sustainable Development and the Sea (MEEDDM) and the French Development Agency (AFD), is by no means exhaustive but aims to highlight key examples of funding solutions which can be mobilised in the public transport sector.