NAIROBI: Dozens of trucks wait in line to cross the border from Kenya to Uganda. Hauling tomatoes along East Africa’s northern border, the drivers have lost up to four hours in reduced speed because of poor road conditions along some segments.
But when they approach the border, the delays get longer. It takes on average a full day for them to complete the paperwork required to cross from Kenya into Uganda.
The delay would cause financial losses with any freight, but it is especially troublesome with agricultural goods, where delays could leave much of a truckload unfit for sale at its destination.
This same losing scenario plays out in different ways throughout the world. Guatemalan exporters sending goods overland to Mexico are forced to offload their cargo from Guatemalan trucks at the border and reload it onto Mexican trucks, a regulatory hurdle that contributes to food spoilage and discourages commerce.
In Nigeria, trucks hauling cassava flour are required to carry about 50 different permits costing $75-$150 per truck per year, often making it uneconomical to transport the important food staple to markets where it is desperately needed.In a world where 12.5% of the population suffers chronic undernourishment, the fact that 30% of food produced for human consumption is lost or wasted between farm and fork is difficult to comprehend.
Along the agricultural supply chain from post-harvest storage through transportation and distribution spoilage, spillage and other contributors to food loss remain a serious problem.Globally, up to 1.3-billion tonnes of food are lost or wasted each year, evidence that hunger is a dramatic consequence of unnecessary trade barriers.
Last July, the World Trade Organisation nations failed to ratify a trade facilitation agreement that would have set the stage for faster and more efficient customs procedures to encourage dramatic changes, not only in the reduction of world hunger but also in fostering environmental sustainability and economic development.
The agreement was designed to encourage effective co-operation between customs and other authorities on trade facilitation and customs compliance issues, providing for technical assistance to help countries build electronic capabilities to speed the flow of goods. It would have opened the door for improving inefficient border administration.
But even in its absence, governments on their own can take some of the recommended steps, addressing the barriers that have hurt the food supply chain and local economies.Those hurdles include protectionist measures that limit market access, underdeveloped transportation infrastructure and services, and regulatory environments that preclude small to medium-sized businesses.
Research conducted for the World Economic Forum by the World Bank and management consulting firm Bain found that reducing even a restricted set of supply chain barriers halfway to global best practice would yield a nearly 5% increase in gross domestic product.
The public sector is best positioned to reduce these barriers, usually in partnership with private enterprises, with both sectors benefiting from each other’s strengths. Hopeful nations can point to the encouraging advances made.When Kenya’s government improved the Nairobi-Mombasa road and expanded the Mombasa port’s capacity, it led to much-needed private-sector investment by exporters and transporters.
