NAIROBI, Kenya, Mar 17 – East and Central African countries have been urged to employ a coordinated effort to improve regional transit and transport efficiencies along the Northern and Central trade corridors.
Chairperson of the East African Community Council of Ministers, Rwanda’s Monique Mukaruliza, said on Tuesday that addressing the inefficiencies of the transport networks could greatly increase cross border trade and unlock the region’s competitive edge.
“The efficiency of these corridors has a direct effect on our ability to grow, attract international investments, trade with each other and the rest of the world and even ensure that our communities have a reliable and adequate supply of food,” she said.
Speaking during the opening of a three-day conference on enhancing the efficiency of the transit corridors, Ms Mukaruliza pointed out that a ten percent drop in transportation costs could lead to a 25 percent increase in trade flows.
While observing that 98 percent of the world’s economy lies outside Africa, the minister stressed that the Continent needs to collectively to access this global market on a competitive basis.
However, she emphasised that this was only possible if transportation costs in Africa which are estimated to be about 40 percent higher than other developing regions (which limits the continent’s competitiveness on the world stage) are addressed.
Ms Mukaruliza cautioned that the region needs not only to fix the physical infrastructure but also implement reforms aimed at removing the regulatory and administrative barriers such as high tariffs, many legal and illegal weighbridges, inefficient border posts and corruption for efficient transit.
According to a recent survey, it takes a Burundian exporter an average of 67 days and 29 signatures to ship goods overseas compared to just five days that a Danish businessman would take.
While poor infrastructure is a factor in the delay, she added it contributes 25 percent to the hold-up while the administrative hurdles accounts for the remainder.
At the same function, Kenya’s EAC Minister Amason Kingi said the region needs to transform its transport cost structure in order to open up new frontiers for its economic development.
Noting that the supply of the region’s transport infrastructure is far below the demands, Mr Kingi said Kenya, which is positioning itself as an efficient transport hub intended to augment the current corridor by developing a new port in Lamu.
“This will form a backbone which will open up new opportunities for the entire region as we further develop and interconnect our regional corridors,” the minister argued.
Meanwhile, it was disclosed that the East African Community is preparing the region’s Transport Strategy that is expected to guide the development of the road transport for the next 10 to 15 years.
EAC Principal Civil Engineer Hosea Nyangweso said the plan would enable the region to address infrastructure development in a holistic approach.
“We are also preparing a transport facilitation program where we aim to harmonise policies, regulations, design standards so that projects undertaken in the region have one harmonised regime,” he added.
He revealed that they are receiving support from the EAC Member states that understand that this development plays a key role in the promotion of the proposed Free Trade Area.