The Lamu Port is positioning itself to tap into the recently launched Africa-wide free trade area.
The expectation is that the port will link up with transport networks in other countries in the region and form a giant corridor that connects the East African coast to the seaboard in West Africa.The Kenyan corridor, which already has buy-in from Ethiopia and South Sudan, hopes that it can link up transport networks in the Central African Republic and Cameroon.The Lamu Port-South Sudan-Ethiopia-Transport (LAPSSET) Corridor Development Authority (LCDA) said this would make it a formidable enabler for the African Continental Free Trade Area (AfCFTA), which became operational on July 7, this year.
The Authority in a statement after a meeting with Raila Odinga in his capacity as the African Union Commission’s High Representative for Infrastructure Development in the continent said the corridor would play a critical role in forming an ‘equatorial land bridge’ across Africa.It added that Raila had been drumming up support for the corridor at the AU.“… a strong case has been made to the AU on the LAPSSET Corridor Project’s strategic position to connect not only Ethiopia and South Sudan, but also connecting to Central African Republic (Bangui) and Cameroon, terminating at Port of Douala,” said the Authority in a statement.
.“This forms an equatorial land bridge of both road and rail across the African continent, connecting the Indian Ocean at Lamu Port, to the Atlantic Ocean.”The AfCFTA agreement forming the continent-wide free trade zone was adopted on March 21, 2018, in Kigali in which members committed to removing trade barriers including tariffs on most goods.The agreement came into force on May 30 this year, a month after reaching the minimum number of member States needed. It currently has 27 members, with Kenya being among the members that ratified it shortly after formation.It has been viewed as an economic game-changer for the continent but analysts note that certain factors that limit trade need to be eliminated.
Regional infrastructureOther than tariffs on imports from neighbouring countries, other factors include poor rail and road networks, bureaucracy at border crossing points and corruption. It has been tipped to increase intra-African trade from by between 15 and 20 per cent in the medium term.“Through such infrastructure development, new enormous markets will be established growing intra-African trade that is currently at a low of 15 per cent. This is in comparison to intra-regional trade in Europe (70 per cent) and Asia (60 per cent),” said the Lapsset Authority, adding that the lack of sufficient regional infrastructure in Africa contributes to such a low intra-regional trade.For example, for Kenya to transport tea or coffee to Bangui, the products will have to be shipped to the Western Cape through the Indian Ocean and the Atlantic Ocean, making it easier for goods in Europe to access such a market quicker and at a lower cost.LCDA added that Raila as the AU’s special envoy planned to convene a high-level meeting with the countries that fall along Africa’s equatorial land bridge later in the year with the aim of forming these crucial transport infrastructure linkages within the continent.LAPSSET has recently said the first of the three initial berths at Lamu Port has been completed, with the others expected to be completed in 2020. “Massive private sector interests have been registered to develop and operate the additional 29 berths as well as develop the new Lamu Port Industrial City,” it said.