African Entrepreneurship Record

The shipbuilding industry in East Africa began in the seventies, and its current development scale is quite decent. Of course, East Africa has somewhat focused primarily on military shipbuilding in this field, with civilian shipbuilding being notably lesser in proportion.

In East Africa, the proportion of imported civilian vessels exceeds sixty percent, including imports from the United Kingdom, Germany, France, Austria-Hungary, and even the Netherlands and Italy.

A significant reason for the high proportion of imports is the inherent deficiencies in the shipbuilding industry at that time. The main East African ports were located along the coasts of what was formerly Tanzania and Kenya, while Mozambique and Angola were not yet part of East Africa’s territory.

Under such circumstances, East African port numbers were quite scarce. In addition, the construction progress of roads and railways was seriously lacking, making it difficult to develop and utilize inland resources. As a result, many raw materials relied on imports.

Therefore, the shipbuilding industry in East Africa at that time was genuinely ”Buying is better than making.” Without excellent seaports, East Africa naturally lacked the capacity to build more shipbuilding enterprises. The most developed shipbuilding center in East Africa then was the port area of Bajamojo City, which could only initially meet naval demands. Under this major trend, East Africa’s military shipbuilding industry advanced rapidly, while civilian shipbuilding lagged somewhat.

This situation also caused the East African civilian shipbuilding industry to be forced to relocate to Zanzibar Island and Bemba Island. These two islands were quite important to East Africa, serving not only as maritime barriers but also having relatively more ports. Coupled with the premise of relying on imported raw materials for East African shipbuilding, the shipbuilding industry in these locations developed swiftly.

Of course, the situation changed in the nineties, firstly because Angola and Mozambique were integrated into East Africa, granting East Africa a batch of excellent seaports and underutilized bays.

Secondly, East Africa’s basic transportation conditions had developed to a certain extent, especially in railway construction, which basically achieved coastal coverage of East Africa.

Inland industrial development further provided conditions for the East African shipbuilding industry. Notably, the rise of the inland shipbuilding industry in the Great Lakes Region and the Malawi Lake Industrial Zone almost coincided with the rise of regional urbanization.

With the increase in port numbers, the development of inland resources, a relatively improved industrial base, and enhanced coastal and inland transportation, East Africa’s shipbuilding industry could already meet the basic conditions for domestic production.

So, Ernst stated: ”Emerging cities such as Luanda, Benguela, Cabinda, Bela, and Maputo have the conditions to develop the shipbuilding industry. Their regional advantages allow the coordination of national resources through highway and railway systems. We must vigorously develop our shipbuilding industry, and raise the domestic share of our civilian shipbuilding industry to at least fifty percent as our initial goal for development.”

”The total tonnage of our civilian vessels should exceed one million tons before 1900, so we can barely compete with the world’s ocean maritime powers.”

Currently, East Africa’s civilian vessel tonnage is nearing seventy thousand tons, while Germany is close to two million tons. Above Germany are the United States, France, and the United Kingdom.

The current civilian vessel tonnage in East Africa just surpasses the level Germany had at the initial stage of its unification. In 1871, Germany’s merchant vessel tonnage was around sixty-four thousand tons.

Purely from the perspective of numbers, East Africa is lagging behind Germany by nearly twenty years, not to mention other countries that boast more developed maritime transportation.

Of course, American shipbuilding development is rather unique. In the last glorious period of the sail era, namely the 1840s and 1850s, American shipbuilding was number one globally, far surpassing its original sovereign country, the United Kingdom. However, although American shipbuilding continued to progress, its pace was clearly slower than European countries.

This is how new technology impacted American shipbuilding. Previously, as a new continent, America had an abundance of forestry resources, which was undeniably a significant advantage during the sail era.

But with the application of steel in shipbuilding, American shipbuilding was quickly struck down by European shipbuilders, falling into a state of decline.

The current state of American shipbuilding is quite similar to East Africa, mainly relying on imports from Europe. Of course, this is the apparent situation.

In reality, the reasons for East Africa’s reliance on imports differ greatly from those of America. A major reason is the late start of the shipbuilding industry in East Africa.

The founding period of East Africa was essentially concurrent with the rise of steel steamships, even missing the last glory of the sail era. This led to the necessity for the East African Navy, upon its establishment, to patch and reuse ancient warships from the Sultanate of Zanzibar.

Subsequently, in the seventies, East Africa introduced a large number of personnel, technology, and equipment from Europe, marking the beginning of East Africa’s modern shipbuilding industry.

Therefore, even if East Africa exerted all its efforts, it was impossible to reach the same level as European countries in a short time, especially since East African investments were primarily focused on inland development. Besides military shipbuilding, civilian shipbuilding was not given much attention. However, from a global perspective, for a new nation like East Africa, the development outcome of East Africa’s civilian shipbuilding industry was also quite remarkable.

But this achievement was established on the basis of East Africa’s gradually accumulated large scale; East Africa’s various industries were likewise affected. With East Africa’s territory exceeding ten million square kilometers and its population surpassing seventy million, a vast number of cities and rural areas emerged. Government tax revenue soared sharply with these factors. Even industries that East Africa initially did not emphasize achieved leapfrog development.

The most typical example is the textile industry, entirely supported by the vast population market. Prior to this, the textile industry was never a focal point of industrial investment in East Africa, and civilian shipbuilding adheres to the same logic, positively correlated with East African immigration and trade scale.

Therefore, although the East African shipbuilding industry started late and developed quickly, there’s still a long way before surpassing the average European level, but overall it has shown an upward trend.

For the American shipbuilding industry compared to its forties and fifties, it is undoubtedly in decline. This is easy to understand; as glorious as America was during the sail era, it means it’s even harder to transition in the new era of shipbuilding.

Moreover, the shipbuilding industry is capital-intensive and slow to yield returns, which is not cost-effective for American businessmen compared to investing in industries that yield faster and require fewer investments. After all, government intervention in the American market is weak, although the government does play a role.

In reality, with the rise of the domestic free trade proposition in America and increased emphasis on the Navy, American military shipbuilding is entering a rapid development phase, nearly in sync with the current expansion of the United States Navy.

In 1890, the United States had already surpassed the United Kingdom in total industrial output value, prompting America to focus on naval efforts due to the changing dynamics. At this juncture, America had product advantages over other countries, requiring naval power to protect the nation’s interests in the commercial market.

Meanwhile, the monopoly position of traditional colonial powers such as Britain and France can only be broken through military competition. Although America lacks the guts, it is always preparing.

Of course, this is not important to Ernst. What matters to Ernst is that East Africa must not follow America’s path in the shipbuilding industry. While military shipbuilding is indeed significant, civilian shipbuilding is equally crucial. Without civilian shipbuilding as a foundation, military shipbuilding cannot advance far, since it’s challenging for military shipbuilding to directly generate economic value.

And the sustained investment needed to support East African shipbuilding cannot rely on private capital. Only continuous support from the East African government can ensure steady progress.