$16m fund to cut business costs in EA
Africa’s Agribusiness Worth U.S. $1 Trillion By 2030
A new fund to support projects aimed at cutting logistics and transport costs across the East African Community region has been unveiled.
The $16 million TradeMark East Africa Logistics Innovation for Trade (LIFT), fund launched last week in Dar es Salaam, is expected to improve competitiveness of businesses in the region.
Among areas the two-year fund, which runs from 2014 to 2016 targets is cutting transit time along the main transport corridors in East Africa by 15 per cent by 2016.
“The LIFT fund will support private sector investments in freight and other logistics as well as business processes in East Africa,” said Frank Matsaert, the CEO of TMEA.
East Africa is among regions with the highest freight and transport costs in the world, eroding the competitiveness of locally produced goods in the world market, thus reducing trade, economic growth, and job creation.
Transport and logistics costs are estimated at 42 per cent of the total value of imports, and as high as 75 per cent of the value of exports.
“A 10 per cent reduction in transport costs is likely to increase trade by 25 per cent worldwide. Without addressing logistics efficiency problems, East Africa’s growth potential will be seriously constrained,’’