Trucking is the lifeblood of the economy in the East African Community, a trade group comprised of Burundi, Kenya, Rwanda, Tanzania, and Uganda. Every day thousands of freight trucks roll across East African borders in a network of international trade. The free flow of goods across borders is vital to economic development, a fact that is no less important in East Africa than anywhere else. But a new report from the Kenya-based Eastern Africa Policy Centre (EAPC) shows that barriers to trade are running up shipping costs and crippling growth in the region.
The study found, for example, that driving a standard 20-ton container from Mombasa, Kenya to Kigali, Rwanda costs between $3,400 to $6,500. Shipping the same freight to the UK via Mombasa’s port (traversing two oceans and the Suez Canal along the way) would only cost $2,000 – $4,000. Reasons for the high costs include tariffs, various fees, corruption, and wait times averaging 13 hours just to cross a border.
The EAPC is right to worry about costs to trade in East Africa, where over 70 percent of traded goods pass along two major highways of the East African Community. High shipping costs suppress employment, stifle growth, and prevent African entrepreneurs from reaching foreign markets. You can read the EAPC’s report here. The report has already been covered by major news outlets in the East African Community such as Standard Media Group and Nation Media Group.
The EAPC study is part of an ongoing Free Trade research and education project.