Warehouse leasing profitable but strained by high cost & finance barriers

A warehousing expert has bemoaned that despite […]

A warehousing expert has bemoaned that despite Warehouse leasing in Zambia remaining a profitable venture, the sector is grappling with significant challenges stemming from limited access to affordable and longterm financing.

The situation is further complicated by high interest rates and stringent collateral requirements, which restrict the availability of capital for warehousing projects. In an interview with the Zambian Business Times (ZBT), an official from Pine Investments Limited highlighted that operational costs, particularly for electricity, security, and maintenance, are a key concern for industry players.

“We are facing several challenges in our sector, namely limited access to affordable finance, long-term funding for industrial developments, high construction costs, and, in some areas, poor infrastructure such as roads and utilities,” the official stated.

 Despite these hurdles, Zambia’s warehousing sector is experiencing considerable growth, driven largely by increased activity in mining, agriculture, manufacturing, and regional trade. The country has become a critical logistics hub for neighboring nations, including the Democratic Republic of Congo, which relies on Zambia for exporting and importing mining products and chemicals.

The Pine Investments official called on government to introduce incentives to attract investment in logistics parks and modern warehouse developments. “Improvements in customs procedures would also help promote bonded warehousing and regional trade,” the official added.

She further emphasized the importance of fostering public-private partnerships to address infrastructure gaps and support the sector’s continued growth.

By Samuel Mutale