The directive by Kenyan president Uhuru Kenyatta to Mombasa port authorities to improve operations at the port will stimulate trade and cut on transport costs, importers have said.
Uhuru last week ordered Mombasa port authorities to ensure they reduce delay time at the port, saying the current situation where containers take 18 days to reach Kampala from Mombasa was untenable. He directed the port authorities to ensure this is reduced to five days at most within three weeks.
The development has caused excitement and relief among the private sector and stakeholders.
Claudine Kabayiza, an importer, said it was good news given the inconveniences they were going through to clear goods at Mombasa.
“We have been spending a lot of money because of these delays. I am happy that finally authorities in Kenya have come to our rescue,” Kabayiza said.
Mohamed Mazimpaka, president of the Rwanda Chamber of Commerce, said the chamber has for long been pushing for such a move. He noted that quick delivery of goods would benefit Rwandan traders and other businesses in the region.
“Efficiency at Mombasa also means that the port will be doing more business than before considering that traders could multiply the number of transactions,” Mazimpaka, who is also the chairman the Wholesalers Association of Rwanda, said.
Gerald Mukubu, the Private Sector Federation (PSF) chief advocacy officer, said the move will ease doing business and enable traders to make decent profits and, thus, spark economic growth,” Mukubu said.
Mukubu also noted that the move would not only reduce on the cost of transport, but will also improve the bilateral trade relationship between Rwanda and Kenya.
“This shows that the new Kenyan government is committed to the principles of the East African Community (EAC). As the private sector, we are ready to work closely with them to boost business within the region.”
Mark Priestley, the TradeMark East Africa Rwanda country director, said the move was healthy and will spark competitiveness between Mombasa port and Dar es Salaam in Tanzania (Southern Corridor).
“Authorities at Dar es Salaam Port have no choice but to up their act… this is a catalyst for increased efficiency and competitiveness, which will ease the way of doing business,” he noted.
Priestley also pointed out that the move will stimulate trade.
“Reducing cargo clearing time from 18 days to five days will greatly hasten the movement of goods on the Northern corridor… This is what we have all along been advocating for at TradeMark East Africa,” Priestley noted.
According to Andrew Othieno Rwigyema, the head of research and policy analysis at Private Sector Federation, many traders have been complaining of inefficiency and high transport costs caused by the delays at Mombasa and Dar es Salaam ports.
“When the directive is implemented, it will enable Rwanda to trade and compete favourably both within the region and on the international level,” Othieno said.
It is estimated that non-trade barriers account for between 30 per cent and 40 per cent of the total cost of transport.
Eliminating these barriers was one of the priorities of the EAC Customs Union Protocol which was implemented in 2010.
Last month, John Bosco Kalisa the TradeMark East Africa senior programme manager, told reporters that the cost of transport along the Northern and Southern corridors was high mainly because of non-trade barriers.
“It is true that the cost of transport along the two corridors is extremely high due to non-trade barriers that include weighbridges, corruption, unharmonised axle load limits, road blocks and the many charges importers and exporters pay,” Kalisa said.
Traders, therefore, hope that Uhuru’s directive will also help address these issues.
The Private Sector Federation is currently pushing Rwanda traders and shippers to form a shippers’ council to help them lobby governments to address such issues.