African states urged to embrace the Africa Continental Free Trade Area agreement

Over 15 countries attended the 4^th Global Logistics Convention (GLC) in Nairobi with the aim of ending the numerous non-tariff barriers and bottlenecks affecting the supply chain in Africa. With the theme, Connecting Continents: Strengthening Global Supply Chains, the convention highlighted;

How different players are harnessing the opportunities under the AfCFT
How the logistics sector is embracing technology
The role of Transport and Logistics Service Providers in promoting Green Logistics
The various financing and insurance solutions for both large and SME logistics service providers
The enhanced channels of building networks and access to markets through intra-trade

Speaking at the convention, KIFWA National Chair, Mr Roy Mwanthi remarked, “As the players on the ground, we know the pain points in logistics and we continue engaging with the government and advising them on how we can all work together to address the high logistics costs.”

The transshipment market remains underutilized in the continent. “It is our ambition for us to connect the east with the west in terms of sea freight, for the Indian Ocean to meet the Atlantic Ocean. Apart from efficiency, our focus is to increase and make Kenya the hub of transit and transshipment. We also want to make sure that transshipment volumes and goods are increased”, said Mr Mohamed Daghar, Principal Secretary, State Department for Transport.

“The recent addition of Lamu Port has cemented Kenya as an important conduit of the Maritime corridor within the Horn of Africa and the East Africa region at large. Once completed, the LAPSSET corridor will open up the whole of Northern Kenya, South Sudan and Ethiopia for an alternative sea route from Lamu Port” Mr Mwanthi added.

With intense global debate and growing concerns for logistics service providers to use clean energy in driving the supply chain, players in the industry were encouraged to adopt cleaner and more eco-friendly logistics solutions.

“We live in a volatile, uncertain, complex and ambiguous world where our industry is affected by phenomena that are beyond our control and the only way to forge ahead strongly is by being united and embracing the exchange of information, skills and expertise”, said Abud Jamal, GLC Chairman Organizing Committee

In an effort to increase free trade within the continent, in the next 10 years, African governments aim to reduce up to 97% of the tariffs to zero thus enabling different players to enter and trade in new markets.

“The challenge we face in Africa is that there is no network connectivity. We need proper infrastructure and free movement of cargo to effect this. Most of our roads do not connect effectively to other countries in Africa. Our airlines do not have free landing rights. We need to come together to improve intra-African trade”, remarked Mr George Kidenda, Managing Director, Freightlogix Kenya.

According to the UNCTA Report of 2021, 90% of freight cargo in Africa is handled by international cargo airlines, leaving only 10 per cent to local airlines. Speaking at the convention and emphasizing the need for liberalization of trade in Africa, Mr Peter Musola, Head of Kenya Airways Cargo remarked, “One of the major challenges in Africa is the issue of uni-directional demand. Flights or sea freight vessels will go one direction full and they come back empty and this has the effect of increasing the unit price. All the elements of the liberalization of trade will stimulate trade within the continent and the more we have bidirectional movement of cargo, the prices will naturally come down.”