Africa’s patchy transport network gets a tech boost

Africa’s patchy transport network gets a tech boost

Benson Ndumu Mwangi has been a truck driver for 10 years, navigating the roads of Kenya and East Africa.

It can be a tough job: “Trucking in Kenya is a challenge, some of the roads are very difficult to manoeuvre through, causing mechanical issues and delays.

“Some areas have a high risk of theft and so we have to be extra careful,” he says.

For Mr Mwangi and others who work in the logistics industry there is hope that a new African free-trade area will spur improvements.

The African Continental Free Trade Area (AfCFTA) agreement is in its first year of operation. Signed in 2018 the deal includes 54 African countries.

The goal is to boost trade by creating a single continental market for goods and services, and to enable the free movement of people for business purposes.

Starting in 2020, tariffs on 90% of products will be eliminated over five years, with other cuts planned.

The World Bank estimates that the move will boost exports among African nations by 81% by 2035.

The deal has certainly boosted investment in technology firms promising to smooth the flow of trade across Africa.

Amitruck runs an online service, which connects the sellers of goods with the continent’s fragmented trucking firms. The start-up currently works with more than 6,000 truck drivers.

Customers enter details of their delivery needs via an app. That prompts quotes directly from truckers – cutting out the expensive middlemen that are typically used.

Drivers are vetted, goods are insured, and there are replacement vehicles on standby to ensure deliveries are not held up by mechanical problems.

The founder and chief executive of Amitruck, Mark Mwangi sees better logistics as a key contributor to Africa’s development.

“Innovation and the creation of affordable products for the African market by local companies is likely going to be what lifts Africa out of poverty,” says Mr Mwangi.

“But, in order to trade across African countries, companies will need to develop African supply chains.”

Other firms are offering maritime and air transport options. Traditionally transporting cargo by air or sea has involved booking offices, customs agents and form filling.

Nigeria’s MVX is trying to change that, by simplifying the booking process and offering real-time tracking of consignments.

Previously, a sender would have to find and book their own goods inspections, use an export agent, find containers and shipping space, arrange customs clearance and more. MVX takes this all online and, with partner companies, arranges the whole shipping process for clients.

“A positive trade agreement is nothing without an efficient logistics system,” says Tonye Membere-Otaji, founder and chief executive of MVX.

“This is a significant area where the continent is still lacking,” he says.

While it is the second most populous continent, and home to approximately 17% of the world’s population, Africa only accounts for 2% of global trade.

Yet to improve on that it will take more than clever technology platforms.

Africa is notorious for its poor infrastructure, making cross-border trading almost impossible for some local companies.

Many feel the AfCFTA agreement will fail, without better ways for companies to move their goods around.

“Going forward, progress will be driven by both the public and private sector,” says Miishe Addy, co-founder and chief executive at Ghanaian air and maritime supply chain platform Jetstream Africa.

“The good news is that governments on the continent are already making massive physical infrastructure investments that are essential to this progress.”

For example, in Ghana work is under way on a $1.5bn (£1.1bn) expansion at the country’s main cargo port, Tema.

The public-private investment will increase the port’s capacity and allow it to handle some of the world’s biggest cargo ships.

Meanwhile, to ease border congestion between Botswana and Zambia, a new bridge over the Zambezi river was opened this year.

As well as new infrastructure, more needs to be done to cut red tape.

Restrictions on imports and exports, and related fees and duties could all do with overhauling to support local industries and production.

Nigeria needs to facilitate and implement policies “that enable African entrepreneurs easy access to capital, and create regulations that make it easy and profitable to trade and do business in Africa,” says Mr Membere-Otaji.

“Generally, the government needs to make the environment conducive for businesses to thrive.”

For truck driver Benson Mwangi, improvements can’t come fast enough.

“When you get to the borders there are long queues and migration issues. At times can get you stuck at the border for a day or more,” he says.

By Gabriella Mulligan


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