High transport costs curtail regional trade

Many hours spent at weighbridges and checkpoints, port inefficiencies and over-use of road networks continue to impede on regional trade by increasing the costs of transport. The high transport costs have in turn increased the cost of doing business in the region.

According to various speakers at the on-going workshop for transport and logistics services industry players, Kenya - and by extension Sub-Saharan Africa - was losing out in trade and investments due to high transport costs.

“In Sub-Saharan Africa, transportation costs are relatively higher than in other regions. There is a need to control transport costs, facilitate trade and bring about competitiveness in the region,” noted the acting Cabinet Secretary for Transport Dr James Macharia in a speech that was read on his behalf by Martin Eshiwani, a senior deputy secretary in the ministry of Transport.

Dr Macharia noted that Kenya has undertaken a number of initiatives aimed at bringing down transportation costs. These include the expansion of the port, the construction of the standard gauge railway (SGR), which is set to reduce transportation costs by more than 50 per cent, construction of more roads and air transport facilitation.

Member States of the Common Market for Eastern and Southern Africa (Comesa) trading bloc were also urged to involve the private sector in formulating policies that would ease transport and logistics in the region.

“The NCTTA is in the process of establishing the Public Private Partnership Committee which will provide a forum for negotiations among the public and private sector stakeholders in order for the private sector have an input in the decisions made by the policy organs,” said Mr Donat Bagula, executive Secretary Northern Corridor Transit and Transportation Authority (NCTTA).

However, the Governments of the Northern Corridors were lauded for their concerted efforts to upgrade and maintain the roads in good condition, construction of One Stop Border Post expansion of the Mombasa Port and automating business processes and extension of hours of work.

Overload controls

Sub-Saharan Africa takes the dubious trophy of having the highest transport costs in the world. According to the Programme for Infrastructure Development in Africa report, the road access rate in Africa is only 34 per cent, compared with 50 per cent in other parts of the developing world, while transport costs are 100 percent higher.

The two-day workshop is aimed at engaging participants in the transport and logistics sectors from Comesa members countries on practical policy recommendations for improving the competitiveness of transport services sector and trade facilitation in the region. Some of the areas of focus include vehicle overload controls, customs laws, procedures and documentation, port efficiency, legal and regulatory framework and Comesa Trade Facilitation Instruments.

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