Uganda, Rwanda, and South Sudan have expressed their support for Kenya's initiative to provide comprehensive logistics services, despite objections from clearing and freight forwarders who fear potential exclusion from the business.
In a recent development aimed at enhancing the efficiency of the Northern Corridor, officials from landlocked Uganda, Rwanda, and South Sudan held discussions with their Kenyan counterparts. They agreed to use the Naivasha inland container depot.
Despite initial opposition from the Kenya Ports Authority (KPA), the government has authorized the provision of end-to-end logistics services following the procurement of over 250 railway wagons and partnerships with transporters to provide last-mile services following a tender issued last year.
However, concerns have been raised by clearing and forwarding agents who view this as a return to mandatory rail transport for cargo weighing over 11.5 metric tonnes destined for regional countries, a contentious issue that has led to legal disputes in the past.
Omae Nyarandi, the executive secretary of the Northern Corridor, acknowledged that while the policy could benefit regional countries and reduce transportation distances by more than 1,200 kilometers, there are several logistical challenges that need to be addressed before full implementation.
Nyarandi highlighted the importance of solving the last-mile issues and integrating cargo entry into a unified system at KPA.
Agayo Ogambi, head of policy and advocacy at the Shippers Council of Eastern Africa (SCEA), noted the significant potential of the transit business, citing an increase in total transit traffic to 11.395 million tonnes in 2023, an increase of 1.16 million tonnes from the previous year.
This was due to an increase in cargo volumes to South Sudan and the Democratic Republic of Congo, indicating a favorable environment for KPA to strengthen its position in consolidating transit operations in the region.