East African traders have always dreamt of a smooth movement of goods across the region. However a number of bottlenecks have always scuttled this aspiration.
The outbreak of the Covid-19 has complicated the matter, resulting in too much delays at the border points. It is against this backdrop that private businesses have sanctioned a study to inform future mitigations on costly delays that impede movement of imported and export goods across countries.
The traders, through the East African Business Council (EABC), say the assessment to be conducted within 21 days will help create a “recovery path based on lessons learnt during the Covid-19 era”.
In a tender posted on its website, EABC said consultancy firms should file their bids seeking EABC’s nod to conduct the survey.
“EABC wants to understand the impact of Covid-19 on the transport and logistics industry in terms of movement of goods and people within East African countries and from outside the region,” it said.
The business lobby said the study, which is supported by TradeMark East Africa, will seek to flag painpoints, identify hardest hit sectors, especially small and medium enterprises, on rail, air, road and maritime transport.
The tender also said the consultant is expected to offer country-specific recovery solutions that will facilitate public-private sector engagements.
The Federation of East African Freight Forwarders Associations (Feaffa), that comprises clearing agents in Uganda, Tanzania, Rwanda, Burundi and Kenya, has welcomed the study saying it is has come at the right time as East African countries have started easing lockdowns allowing return to normalcy.
“The study comes at a time when the industry players are putting in place various measures to adopt ‘new normal’ in logistics as the regional government progressively ease restrictions they spelt out in March this year after the EAC recorded its first cases of Covid 19,” it said.
Feaffa has since developed a set of Standard Operating Procedures (SOP) aimed at reducing spread of Covid 19 among the logistics service providers in East Africa as the economy opens further.
SOP, an initiative also supported by non-government trade facilitator, TMEA targets the cargo road trucking- drivers, crew and transporters; warehousing, Container Freight Station (CFSs) and Inland Container Depots (ICD) as well as the customs clearance and freight forwarders sector.
The transport sector has reported major disruptions blamed for runaway costs of doing business due to longer processes for goods verification, as well as testing of truck drivers for Covid-19 at border crossing-points and ports.
According to the Shippers Council of East Africa (SCEA), transporting cargo cost from Mombasa to Kampala usually takes an average of two days to four days for a return journey but since Covid-19 struck, it now takes between seven to nine days, raising costs by up to Sh100,000.
Transporting cargo to Bujumbura now costs 200,000 while those destined to Juba costs Sh240,000, a significant increase from the previous charges.
The cost for taking goods to Kigali have risen by Sh140,000 where it now takes between 14 days to 16 days up from seven to eight days while the nine-day to 10-day trip to South Sudan now takes between 21 day and 26 days.
“From Mombasa to Bujumbura, transporters require up to 20 days from an average of 10 days in 2019,” said the survey.
The logistics study comes as Kenya and 14 other countries announced plans to launch an online-based verification platform aimed at facilitating faster clearance at border crossing points.
The electronic certificate of origin (eCO) System, developed under the Common Market for Eastern and Southern Africa (Comesa) digital free trade area will fast-track movement of goods, enhancing intra-regional trade.
The new plan will do away with registration, application and submission of certificates for post-verification of goods.
Certificates of origin are issued to exporters within the Comesa Free Trade Area to confer preferential treatment to goods originating from an FTA member State.
Truckers issued with eCO certificates will no longer stop to undergo an audit of their cargo via a manual verification process.