This archive report was first published on 15 June 2020.
Kenya's Transport Cabinet Secretary James Macharia has sparked controversy with a directive that could have far-reaching consequences for regional trade.
On June 15, 2020, Macharia gave Uganda a 10-day ultimatum to use the Naivasha inland container depot (ICD), citing the need to contain Covid-19. However, this directive may be in violation of Article 11 of the Trade Facilitation Agreement of the WTO, which obligates signatories to ensure regulations, formalities, procedures, and controls on traffic in transit do not unnecessarily restrict trade.
The article also encourages the setting up of separate physical infrastructure to aid transit traffic. However, Kenya may have failed to contextualise the legal and financial ramifications of its decision.
Mukwano Industries (U) Ltd, a Ugandan company, has protested the directive in a letter to the Kenya Ports Authority (KPA), pointing out contractual carriage obligations between shippers, consignees, and shipping lines. They questioned how such a weighty decision could be made without consultation and consent.
The United Nations High Representative for Least Developing Countries, Landlocked Developing Countries, and Small Island Developing States has previously acknowledged that transit transportation in East Africa was relatively well regulated and coordinated. Activities and deliberations of the Mombasa-based Northern Corridor Transit and Transport Coordination Authority have been held up as fine examples for intergovernmental mechanisms in this space.
Kenya's response to the Covid-19 pandemic has been wanting, with fewer tests conducted than both Uganda and Ethiopia. For every million people, Djibouti, Rwanda, and Uganda have carried out more tests than Kenya. Tanzania and Uganda have even publicly questioned the veracity of Kenya's tests and samples.
The delays at the border also pose serious financial implications to traders, compounding the disadvantages landlocked countries face, including delays and high transit and transport costs. It is in Kenya's interest to speedily resolve this problem as further delays would put the population at higher risk of the coronavirus.
As Kenya continues to cut an image of a pushy, arrogant, and incompetent transit partner, Tanzania is positioning itself as a viable alternative. Already, there are ongoing oil pipeline projects to link Dar es Salaam to Uganda and South Sudan. Unless Kenya changes course, its neighbours could all opt for Tanzania's SGR, rendering the Lamu port, SGR, and Naivasha ICD white elephant projects.
Mr. Kennedy Chesoli is a New York-based development economist and global policy expert.
