Get rid of hidden cost, logistics industry stakeholders told

Global Logistics Conference kicked off with a call for the distinguished participants, stakeholders and more importantly the industry players to eliminate hidden and unnecessary charges which in turn increases the cost of doing business.
As a result, the competitive edge that should have been accrued ends up disappearing in oblivion, leaving the logistics industry, its actors and the wider economy to take the toll.

It emerged at the ongoing Global Logistics Convention (GLC) in Kampala, an annual freight logistics event of the Federation of East African Freight Forwarders Associations (FEAFFA), that the issue of the hidden costs is a global problem, something the Kampala conference is expected to prescribe lasting solution for.
In his remarks earlier in the day, the Uganda Revenue Authority Commissioner for Customs, Mr Dicksons Kateshumbwa, said the responsibility of finding solution to this problem which keeps rearing its ugly head time and again falls on the shoulders of the participants in the conference, most of whom are either industry players, policy makers, sector analysts, academicians and industry researchers among others.
This is because the event offers a unique opportunity for participants to share best practice in trade and policy, facilitates engagement with a wide range of stakeholders, and provides awareness on the changing roles, responsibilities and emerging trends in the industry as a driver for productivity and competitiveness.

He said: “We must be aware of the hidden costs which manifest itself in the form of delays. This remains one of the biggest issue globally that should be dealt with.”
He continued: “This conference should be looking to narrow time taken in transport from one point to another. This will help bring to zero the amount of hidden costs incurred in delays across the value chain.”

Factor in drivers
According to Mr Kateshunmbwa, the drivers of the trucks should be the focus of discussion for they play a role in facilitating the problem either by default or design.
“Don’t forget to talk about the drivers. They must be helped to understand what trade facilitation means and how important it is in what they do.”

Just one day delay between Mombasa and Kampala, results into additional $300 cost. It is for this that such hidden cost become a non-tariff barriers and so must be eliminated.
In his address, the board member of the Private sector Foundation Uganda (PSFU), Mr Patrick Bitature, said: “Time is the most valuable thing in business. It affects the cost of any project. So any delay leads to more cost. We must arise above that and do things properly because logistics is at the heart of every business or projects being undertaken.”

In his speech before opening the GLC, Ms Monica Azuba Ntege, the Minister of Works and Transport, said government will always be involved in matters of trade facilitation, given its benefits in enhancing competitiveness. She also said national transport policy is being reviewed with the aim of including logistic industry into the sector planning document.
Over recent years, Uganda has begun to play a wider logistics role in the Great Lakes region despite its landlocked position. For instance, importers in South Sudan and DRC keep supplies in bonded facilities in Kampala and bring them into either country when needed, with shorter lead times.
As a result, Uganda has seen transit volumes grow, which in turn has led to the emergence of a distribution industry especially in Jinja and Kampala although the country still faces higher trade and transport costs than its coastal partners Kenya and Tanzania.

Challenges
Some of the challenges include: high-level logistics risks including lack of Private Sector strategy on logistics; Poor organisational capacity and technical skills; bureaucracy and red tape in setting up logistics operations; poor transport facilities; weak adoption of logistics practices; and dysfunctional advocacy.
With support from Department of International Development (DFID) through TradeMark East Africa, National Logistics Platform (NLP) under the Private Sector Foundation Uganda is implementing a project that seeks to influence Government to reduce key these obstacles affecting logistics services including. The project will work on adopting a private sector strategy for logistics; implementing a monitoring mechanism for the strategy; enhancing capacity of logistics players; improving coordination of logistics stakeholders and influencing policy.

Utility
In partnership with the Uganda Freight Forwarders Association with support from the National Logistics platform and Ministry of Works and Transport, the two-day Global Logistics Convention has brought over three hundred fifty (350) participants including logisticians, government officials, civil society organizations, Development Partners, academicians, and other private sector stakeholders to discuss and define integrated roles each will play in transforming Uganda into a Logistics Hub.

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