FREIGHT

EAC transport, logistic costs high at Sh212 per kilometer – report

EABC calls for the formulation of a transport and logistic charter.

In Summary

•A total of 34.13 million tonnes of cargo were handled in 2020, which is 1.8 million tonnes shy of the target of 35.90 million tonnes in 2019.

•Containerized cargo also declined by four per cent from 1.4 million tonnes (2019) to 1.35 million tonnes in (2020).

A queue of long distance trucks at the Kocholya bridge on January 6, 2022.
LONG QUEUE: A queue of long distance trucks at the Kocholya bridge on January 6, 2022.
Image: EMOJONG OSERE

Freight costs in the East African region have increased  to a high of $1.8 (Sh212) per kilometer per container, a survey indicates.

This is against international best practices of $1(Sh118) per kilometer per container.

The EAC trade and investment report (2020) shows EAC exports globally stood at $6.2 billion (Sh732.8 billion) in 2020, while imports at  $35.6 billion (Sh420.8 billion), registering a negative balance of trade of $19.4 billion (Sh229.3 billion).

Speaking at the EABC-TradeMark East Africa (TMEA) webinar on corridor performance and impact on EAC business competitiveness, Shippers Council of Eastern Africa official, Agayo Ogambi, noted that Mombasa port throughput declined by 0.9 per cent in 2020.

A total of 34.13 million tonnes of cargo were handled in 2020, which is 1.8 million tonnes shy of the target of 35.90 million tonnes in 2019.

Containerized cargo also declined by four per cent from 1.4 million tonnes (2019) to 1.35 million tonnes in (2020).

Ogambi called upon government agencies to render services that are corresponding  to the fees charged, as outlined in Article six of the WTO Trade Facilitation Agreement.

Improvement of infrastructure, automation and interconnectivity however expected to help reduce transport costs.

Nearly 66 per cent of East African cargo uses the Northern Corridor, wich runs from Mombasa into landlocked countries of Uganda, Rwanda, South Sudan and DR Congo.

The region is also served by the central corridor, which runs from Dar es Salam Port into the hinterland.

Melchior Barantandikiye, head of department at the Central Corridor Transit and Transport Facilitation Agency (CCTTFA) said reduction of the number of weighbridges from nine to three, and road tolls from $16 per 100 kilometres to $10 are some of the measures done to improve the performance of the Central Corridor.

About 80 per cent of cargo on the central corridor is moved by road.

East African Business Council chief executive John Bosco Kalisa has called for geo-fencing of the Northern Corridor and Central Corridor to facilitate trade.