Kampala. Uganda is considered a cheaper cargo route for goods bound to South Sudan, than the direct route to from Mombasa to Juba.
This was revealed by Mr Richard Kamajugo, the senior director for trade development at TradeMark East Africa while giving a keynote speech at the opening of the joint oil and gas convention and regional logistics expo at the Kampala Serena Hotel on Tuesday.
He said this was an opportunity for Uganda to leverage if it was to be a hub for logistics within East Africa.
“When I looked at the numbers, I saw something which I think we need to build on and grow. That the cost of transport from Mombasa to Juba direct was higher than Mombasa-Kampala and then Kampala-Juba. There is already an opportunity here for us to pick on,” he added.
This is part of efficiencies that give Uganda the potential of being a regional logistics hub with centres in Mbarara, Gulu, Kampala and Tororo.
Despite the weak infrastructure, Uganda is ranked 58 out of 168 countries, according to the World Bank Logistics Performance Index (LPI) for 2016.
It was the 5th country in Africa and top performing low-income country ahead of Tanzania, Rwanda and Cambodia among others. The report highlights that being landlocked is no-longer unfortunate.
“For the first time in the history of the Connecting to Compete reports, landlocked countries are no longer automatically the most unfortunate ones, as evidenced by, for instance, the performance of Rwanda and Uganda,” the report reads, inpart.
Mr Kamajugo points out that it did not require billions of dollars to revamp the infrastructure in order for Uganda to get a good ranking but rather “soft reforms that improve efficiencies in the clearance of goods and services.”
These are part of the reforms that came from the Northern Corridor Integration Projects (NCIP) where Uganda, Kenya and Kenya are taking the lead.
However, Uganda has no logistics policy or transport strategy that would underline the direction policy should take in facilitating Uganda being a logistics hub. For instance, it is estimated that about 25 per cent to 40 per cent of current costs in logistics are attributed to transport charges.
“Admittedly though, we still have a long way to go in establishing the robust infrastructure needed to realise the dream of a logistics hub,” said Gen Katumba Wamala, the state minister for Transport while reading the speech of Ms Monica Ntege Azuba, the minister for Works and Transport.
“It is timely for logistics because we are talking about value chains. So it cannot continue being business as usual. It is obvious that three-quarters of the goods we import are heading to our neighbouring countries DRC and South Sudan because we have the inland ports but we also have a distribution strategy,” Ms Jennifer Mwijukye, the managing director Unifreight Logistics, told delegates attending the conference.