EABC Chief Executive Officer (CEO) John Bosco Kalisa called on Thursday as he spoke during the regional private sector engagement in the ocean freight transport and logistics sub-sector, which focused on fresh produce and managed by the East African Business Council (EABC) in Partnership was organized with TradeMark East Africa (TMEA), funded by the Ministry of Foreign Affairs of the Netherlands.
He said intra-trade in the East African Community is low at 17% due to barriers and the high cost of transportation, estimated at around $1.8 per tonne per kilometer.
Kalisa stated that the complexity and competitiveness of the EAC economies depend on the transport and logistics sector. He also called on ports and trade facilitation agencies to better facilitate trade.
He stated that the ports of Dar es Salaam and Mombasa should compare Durban’s best practices in terms of efficiency, ship turnaround time and congestion in order to be competitive in the African Continental Free Trade Area (AfCFTA) and international markets.
Paveen Mbeda, Head of Public-Private Dialogue and Export Capability at TMEA, said TradeMark East Africa is committed to supporting trade facilitation initiatives to increase economic growth and prosperity.
She explained that according to a study funded by the UK government in 2021, sea freight can reduce CO2 emissions by 84% to 95%. She urged fresh produce exporters to explore sea freight options.
Agayo Ogambi of the Shippers Council of Eastern Africa announced that air freight for fresh produce costs $2/kg (40ft lot / 22 tons) up to $40,000, while sea freight costs $12,000. Transit time of sea freight from Mombasa to Europe is 24-30 days.
He explained that the World Bank’s 2021 Global Container Port Performance Index (CPPI) ranked the port of Mombasa 293rd and Dar es Salaam 362nd out of 370 overall, with the low rankings related to delays, congestion and facility management.
Ogambi said the Port of Mombasa is a crucial landing point for goods and connections to the North Corridor, and expansion of sea freight through the port could boost exports to the Middle and Far East, including China and Singapore.
Emmanuel Rutagengwa, Head of Transport Policy & Planning, Central Corridor, said Central Corridor will transform into an economic corridor with value creation hubs connecting manufacturing hubs to boost exports and create more jobs.
dr Merian Sebunya, Chair of Uganda’s National Logistics Platform (NLP), called for an EAC strategy for fresh produce that will depend on the country’s comparative and competitive advantages.
South Sudan Shippers Council’s Yowa Soso called for investing in soft and physical infrastructure and comparing international best practices and lessons learned from other countries to improve the transport system in the region.
Hosea Machuki from the Fresh Produce Exporters Association of Kenya explained that Kenya exports 58% of the fruit by sea, which is about 3,000 containers per year, and 42% by air, which is about 50,000 tons per year. The main export markets for Kenyan horticultural products are the Netherlands, the United Kingdom, Germany, the United Arab Emirates and France.
Clement Tulezi, CEO of the Kenya Flower Council, also stressed the need for EAC countries to establish horticultural product consolidation centres.
Port Infrastructure Development, Non-Intrusive Verification, WTO Trade Facilitation Agreement, Railway Expansion and Development Reducing compliance costs, delays and fuel prices and loan interest charges; automating processes to reduce human intervention; introduction of electronic phytosanitary certificates and target clearance; Elimination of non-tariff barriers to trade, reducing land freight costs to the Port of Mombasa and Dar es Salaam; Proposals put forward to encourage exports of fresh produce from the EAC block include configuring trains to transport fresh produce and increasing direct deliveries to European markets.