As Managing Director of Kargo International, a reputable Freight Forwarding company and Chairman of the Shipping Council of Uganda, Mr Charles Kareba with over 40 years’ experience is a thought leader in the Freight and Logistics Industry.
He takes me through the origins of the term ‘logistics’ - a military word denoting the management of the flow of supplies to troops at the frontline, this was mastered by historical leaders like Hannibal of Carthage and Alexander the Great who are considered logistical geniuses.
Considering the fact that around 90% of Africa’s trade happens by sea, it naturally makes its ports crucial locations in logistics networks.
Mr. Kareba notes that on the global scale of the shipping industry, Africa contributes a paltry 3%. This is insignificant but growing as there is a continent-wide expansion of existing maritime ports and creation of new ones from Djibouti to the Port of Banana in the DRC. Much of this is with funding and support from Dubai Port World, a leading enabler of global trade and the China Harbor Engineering Corporation (CHEC) which has been overseeing construction of the Kribi Port in Cameroon, which on completion is set to be the largest deepwater port in Central Africa.
The Lamu Port South Sudan Ethiopia Transport (LAPSSET) Project which is also nearing completion will serve Ethiopia and South Sudan. He notes that the recent peace developments between Ethiopia and Eritrea will open access to the Port of Asmara which had been inaccessible for over two decades creating a closer route as Ethiopia has been using the Port of Djibouti to access its cargo.
Regionally, East Africa is served by the maritime Port of Mombasa and the Port of Dar es Salaam through the Northern Corridor transport route and the Central Corridor respectively.
Uganda, Rwanda, Burundi and Eastern DRC easily access these two ports through the roads and rail systems which have also been upgraded. One Stop Border Posts (OSBPs) have been created at all entry/ exit points - Busia and Malaba for the Northern Corridor as well as Mutukula for the Central Corridor. The introduction of non-intrusive cargo scanners at the One Stop Border Posts has also been adapted to ease the movement of cargo.
Uganda’s geographic position gives it access to the use of Lake Victoria as a Central Corridor cargo transport option from Dar es Salaam by rail or road to Mwanza and by ferry to Port Bell Luzira with a 3-4 day time frame.
For the Freight and Logistics industry to operate seamlessly, there is a need to have a favourable balance between goods imported into the country as well as have a variety of goods exported, Uganda has had a growing balance of payments deficit from 1979 after a 5 year period when coffee exports were at an all-time high.
Mr. Kareba notes that a country's economy flourishes when there is diversification, giving an example of Mauritius which was a leading sugar exporter but has since diversified and currently sugar exports contribute to only 2% to their GDP.
Creation of Free Trade Zones also bolsters the manufacturing of goods and improves the export base as can be seen in Rwanda where Volkswagen's assembly line rolled off its first locally made vehicle in the region.
The logistics industry in the East African region has been growing since the independence era. With the creation of the East African Community in 1967 which had a common Customs Union, Railway and Harbour system, a number of indigenous companies mushroomed.
In Uganda, the subsequent expulsion of Indians by Idi Amin in 1972 also created a vacuum in the logistics business which then was later filled by local freighters.
The EAC was a success story and at the time of its dissolution after a decade of development in 1977, East African Railways Corporation (EARC) had been the largest public sector enterprise and reputedly one of the best managed. It was the predominant carrier of freight traffic between Mombasa and Nairobi, and almost had a monopoly of long-distance traffic into Uganda.
Following the collapse (in 1977) of the former East African Community (EAC) under which it operated, each member state became responsible for the railway network and operations within its territory, leading to the creation of the Rift Valley Railway concession and currently the onset of the Standard Guage Railway System system which is in operation from Mombasa up to Nairobi.
By Emmanuel Kawamara
Emmanuel Kawamara is a freight and logistics certified practitioner and founder of East Africa Freight Hub, an online space for practitioners in the Freight & Forwarding industry.