Press Center | Freight Shipping Logistics News

The price of goods is set to drop significantly following the launch of an online database to host import rules, regulations and procedures.
The price of goods is set to drop significantly following the launch of an online database to host import rules, regulations and procedures.

The e-portal aims at enabling shippers to cut down on the time they take in trade transactions and logistics, thus reducing clearance time at the port.

This will have a direct bearing on transport costs, which are among the highest in the world.

Delays at the port have been linked to the high price of imported goods, besides blunting the competitiveness of Kenyan exports in the local, regional and international markets.

“Once traders are armed with the right information, they will be able to purchase and transport goods in good time and with minimum inconveniences in the region,” said Kenya Shippers Council chief executive Gilbert Langat.

The system will also include a category of banned products in the region. Mr Langat said that traders are at times not compliant for lack of information.

“Once this information is provided, a trader will be guilty of overloading and will be punished,” he said. The exercise will develop gradually and interlink the whole of East Africa in the next one and a half years.

The Chairman of Vision 2030 secretariat, James Mwangi, said adoption of the system was key to improving efficiency in trade.

“The system will eliminate the physical contact between officers and traders, which is fertile ground for corruption,” he said.

Once adopted, Mr Mwangi said, the economy would save about Sh40 billion annually.

With the assistance of TradeMark East Africa, there will be an integrated system where a trader can access information from other agencies such as the Kenya Revenue Authority and the Kenya Bureau of Statistics.

“This will see a reduction in the cost of doing business in the country and improve the competitiveness of Kenyan goods,” said Mr Mwangi.

TradeMark East Africa undertook this initiative as part of its single window and integrated border management initiatives in East Africa. The key aspect is collection and dissemination of trade-related data.

Mr Athman Mohamed, a senior manager at TradeMark East Africa, said digitisation is an enhancement tool to ensure trade is carried out in a better way.

Use a lot of paper

Mr Mwangi said: “Business people in the export and import line will not have to use a lot of paper and other resources for storage of their products. This is one of the measures that will improve efficiency in the system.”

It will also reduce the delays normally experienced at the ports, with the cost passed on to the end user. The single window structure will enhance clearing of goods, hence minimise delays experienced at the port.

Studies indicate that local transport expenses as a result of delays cost about 30 per cent, while it costs only 5 per cent in other parts of the market.

This has discouraged investors from venturing here while others have relocated to other regions. Improvement on trade operations has been identified as a key determinant to economic growth.

The World Bank’s 2011 Doing Business report ranked Kenya 144 out of 183 economies in the Trading Across Borders indicator, dropping one place from a year before.

Some of the factors considered include time, cost and complexity with which goods move from source to destination. It also includes the number of documents required, time taken and the cost to import and export.

The report indicated that it takes 12 days to prepare export documents and 11 days for import documents, costing cargo owners Sh36,450 and Sh33,300 respectively, a cost that is passed on to consumers.

The Kenya Maritime Authority has also drafted regulations to govern transport at the port. The regulations have been finalised and await gazettement.

Once passed, they will ensure rapid, fair and predictable supply of maritime transport services through seaports.

The regulations are also expected to encourage domestic investment in the maritime sector to expand trade and assist the country to improve on its projected economic growth.