By Our Reporter
A USD16 million challenge fund dubbed the Logistics Innovation for Trade (LIFT) has been opened for innovators who can develop a strategy to crack the code into reducing the cost and time of transport and logistics in East Africa. The challenge fund which was also launched in Kenya, will provide grants ranging from USD 200,000 to USD 750,000 to winning proposals from innovators from across the world but whose ideas will be implemented in East Africa.
LIFT is managed by TradeMark East Africa (TMEA) Challenge Fund with funding support from UK-DFID; and seeks to trigger and introduce innovative approaches to tackling freight and transport costs in East Africa region.
East Africa is reported to have the highest freight and transport costs in the world; over 50 percent higher than the USA and Europe per kilometer. Indeed, transport costs for land locked countries in the region can be as high as 75 percent of the value of exports. Transit times have the most significant effect on exports and also result in firms having to carry higher levels of stocks making them less efficient.
A successful LIFT project will contribute to TMEA’s objective of reducing transport time along the main East Africa transport corridors by 15 percent by 2016.
Speaking in Kampala on 16th December 2014, TMEA Uganda Country Director Allen Asiimwe said, “The high costs of freight and transport seriously erodes the competitiveness of goods exported by East African countries and raise the cost of living, reducing trade, economic growth, job creation and poverty reduction. The future of the transport and logistics sector in the East African Community relies on innovation developed by the private sector and easing of the numerous regulations to allow this to transpire. Through the LIFT challenge fund, we want to encourage transport and logistics providers to focus on services that would not have been provided by the market.