Home Trade Rwanda aims to be EA’s logistics hub

Rwanda aims to be EA’s logistics hub

by Wanjiku Mbugua

Rwanda’s government and Dubai Port World (DPW) signed a concession agreement that will see the later develop and operate the Kigali Logistics Platform (KLP) destined to be a dry port.

“This agreement will help to reduce transport costs and increase profits for businesses,” Francois Kanimba, Minister for Trade and Industry said. A dry port is an inland terminal directly connected by rail or road to a sea port, providing services for handling, temporary storage, inspection and customs clearance for international trade. “Good leadership and the friendly business environment growing in Rwanda attracted our interest to this infrastructure investment,” Suhail Albanna, Senior Vice President and Managing Director of Dubai Port World for the Middle East and Africa region said.

DP World has a portfolio of more than 65 marine terminals across six continents employing some 36,000 people. The trade ministry has been in the process of implementing the Rwanda Logistics and Distribution Services Strategy which will enable Rwanda to overcome logistical difficulties that have negative implications on Rwanda’s trade competitiveness. “There are cases where offloading containers takes almost the whole week, forcing truckers to make only two trips per month. But with this new infrastructure, the trucks will do as many as five trips per month. This will surely reduce transport costs and increase profit for businesses,” Kanimba said. At completion the KLP will mean the consolidation and distribution of goods. It will have functions similar to those of a seaport, and which includes customs clearance services. Francis Gatare , the Chief Executive Officer of the Rwanda Development Board was also in attendance. “The KLP is not only expected to improve the existing logistics infrastructure in Rwanda, but leveraging its central position will also help to position platform as a transit hub for neighboring countries,” Kanimba said. The move to establish the KLP will create a logistics hub in Rwanda and help to provide a consolidated volume of imports. With this infrastructure, the turnaround time of trucks and containers is set to reduce significantly, thereby reducing associated transport costs. Container handling is DPW’s core business and generates more than three quarters of its revenue.

In 2014, DP World handled 60 million TEU (twenty-foot equivalent container units “We bring to Rwanda world-wide expertise and knowledge of the logistics arena; it is an encouragement to the business and export sector to be able to globally compete,” Albanna said. According to Albanna, the preliminary study shows that at least $30 million will be needed to set up KLP. The logistics hub will be expected to consolidate common services for vehicle parking, container stacks and ancillary facilities. Additionally, it will bring together stakeholders in the logistics industry. It will also provide a warehousing complex creating synergies with the other infrastructure and allowing manufacturers to access value added services and solutions for inputs and finished products at one location.

The KLP, to be established in Masaka sector, Kicukiro district, is expected to not only help improve the existing logistics situation in Rwanda, but also help it in leveraging its central position as a transit hub its neighboring countries. The platform has been conceived to serve the local and regional demand for quality logistics services and is aimed specifically to address the deficiencies of the regional logistics performance.

It will therefore serve as a consolidation hub for international and domestic trade, value addition center for regional agriculture and industrial cargo, regional transit hub for neighboring countries – Burundi, Eastern DRC and Uganda among others. The platform will provide different functions such as, inter alia, container and break-bulk/bulk handling and storage facilities, space for stakeholders dealing with freight transport (for example, freight forwarders, shippers and transport operators) and the provision of accompanying services such as customs inspections, tax payment, maintenance and repair, banking and ICT connections.

(Source: East African BusinessWeek)

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