1. Who is Shippers Council Eastern Africa (SCEA)?
The Shippers Council of Eastern Africa is a business membership organization whose mandate is to advocate for an improved policy and trade environment, educate shippers on their rights and obligations in import and export trade, interpret government regulations and procedures, and provide a platform for sharing experiences through networking forums, and training and awareness workshops.
2. When was SCEA established?
KSC was officially re-launched as a representative of cargo owners on 25th October 2006 by the then Minister of Transport Hon. Amb. Chirau Ali Mwakwere and the Permanent Secretary, Gerrishon Ikiara and started operations in June 2007 following the appointment of a Chief Executive and one part time member of staff. The council was housed at KAM from June 2007 to June 2010 with an 8-member board made up of the leadership of the five founding associations namely KAM, East Africa Tea Trade Association (EATTA), Kenya Coffee Traders Association (KCTA), Fresh Produce Exporters Association (FPEAK), and the East Africa Cement Producers Association East Africa (EACPA).
The 2009-10 Strategic Plan proposed the eventual transformation of the Kenya Shippers Council to a regional body at the end of the Strategic Plan period, due to the reach of its members and the extent of the transport and logistics issues that emanate from the Port of Mombasa to the hinterland. It is also in line with the Council’s strategy to lobby the East African Community on logistics issues. From 2013, the Council will operate as Shippers Council of Eastern Africa, legally registered in Kenya but with intentions of establishing a regional presence.
3. What are your key priorities this year, in terms of trade facilitation for the East Africa region?
They include efficiency of the port of Mombasa which remains a keybottle neck to trade for the region. Already, we are engaging the major players, Kenya Ports Authority, Kenya Revenue Authority and thenewly formed entity, KenTrade that will run the National Single window system which will automate trading processes(www.kentrade.go.ke). Rwanda has managed to implement its own single window system despite Kenya starting the process as far backas 2006. Other areas of focus in capacity building and empowerment of shippers in the region, who are yet to fully grasp the processes involved in trade, leaving this responsibility to their freight forwarders,as well as awareness about new and existing laws, regulations and protocols that govern international and regional trade.Collation and dissemination of trade indicators that will help not onlytraders to make informed decision but also the East African government. Currently the region is experiencing a trade imbalance with more imports than exports from the region, yet exports are crucial for economic growth of the region- any economy really.Growth of exports is an area that we will lay special emphasis on inthe strategic period 2013-15.Lastly, adoption of best practice in transport and logistics throughstudy tours and encouraging automation of logistics processes.
4. What is your focus on improving the logistical competitiveness in the region with respect to different modes of transport, be it road, rail or air, sea?
The key area of concern now is how to increase investment in the rail infrastructure which will help reduce the stress on the road infrastructure. Use of rail will also reduce the non-tariff barriers and inefficiencies that have cropped up as a result of frequent use of heavy commercial trucks to transport goods- these include truck licenses,where a truck registered in any of the countries cannot moveseamlessly in the region and has to secure multiple licenses to enable it carry cargo in different countries. This is true despite the customs union protocol that exists in the region. Other barriers include delays at numerous weighbridges, police stops, border stops among others that are very costly to importers/exporters.In maritime, we are looking at advocating for implementation of regulations that govern the operations of maritime service providers who are also a major source of frustration for cargo owners. The current regulatory framework is weak and cannot enforce service level agreements between port authorities and freight forwarders,container freight stations and shipping lines.
5. What is your agenda on addressing customs and other regulatory issues that are major problems to the logistics sector in the region?
The major challenges with customs and to a large extent the other regulatory authorities is that they do not compensate shippers for inefficiencies that arise out of the failure of their systems or delays that they cause but severely penalize shippers if they are the cause of delays. This calls for a review of the acts of parliament that created them to ensure that service levels are maintained to a high standard and that shippers have a way of recouping losses from these government agencies .Another issue is the tariff classification of goods which is a source of penalties to shippers. It is quite complicated and even the most experienced declaration experts still get the bands wrong leading to penalties to shippers for mis-declaration. While it is always thought that this is an attempt to defraud the government of requisite taxes, it actually points to the complexity of the code. East Africa has not customized the tariff code by providing extension. SCEA will be pushing for these extensions to the code, an action that would help simplify it and reduce cases of mis-declaration.
6. What are you most concerned of in terms of challenges this year?
Increase of SCEA membership including from the region, increasing the competitiveness of cargo owners in the region using measures mentioned in Q3 above, entrench the SCEA brand in the region so that it is recognized as the voice of shippers in the region, attract full government participation in addressing of logistical challenges. So far EA governments have been a step behind while they should be a step in front of the private sector, while governments are the biggest beneficiaries of thriving trade in terms of revenue collection.
As SCEA we want governments to adopt policies that are friendly totrade and not only targeted at tax collection. With Kenya having a new government and governance structure, it is imperative to engage theKenyan government at the early stages, since studies have shown that 60% of the logistical challenges experienced by East African shippers emanate from Kenya. If we can address these issues of cargo security,numerous uncoordinated trade procedures, weak and overlapping regulatory frameworks, insufficient port handling capacities, among others.Reduction of the cost of inland transportation is also a key issue offocus. We have our work cut out for us.
7. What is your outlook for the East Africa region in terms of its tradecompetitiveness this year?
The prospects are positive. International and intra-regional trade has continued to grow despite the numerous trade facilitation challenges experienced throughout the years. We will push for the trade policy toinclude a strategy on how to grow exports in the region.
8. Which are the other bodies SCEA is working with to meet it's objectives?
They are numerous, starting with the EAC Secretariat based in Arusha,Tanzania, the East African Business Council also based in Arusha, and national shippers council’s in the region ( Uganda Shippers Council,Tanzania Shippers Council, Zanzibar Shippers Council.) We will also assist Rwanda and Burundi to form their own Councils. Other organizations include umbrella bodies for different sectors inthe region. These include manufacturing, horticulture, cement, coffee,tea, cotton, among others. Basically these represent the largest moversof cargo in the region. Others private sector organizations areassociations representing shipping lines, transporters, clearing and forwarding agents among others Government ministries and agencies- revenue and port authorities,bureau of standards, port health, roads and rail authorities, ministries of trade, transport, EAC among many others. Donor organizations such as Trademark East Africa who we are currently working with on some of the challenges are also crucial partners.
9. What is SCEA’s vision for the next five years?
SCEA’s current strategic period runs from 2013-2015. It will focus onthe following key areas:increasing the competitiveness of cargo owners through lobbying activities, identifying and building partnerships with institutions that will assist SCEA effectively discharge its mandate, develop institutional structures that will ensure the organization’s sustainability, and build a strong brand with national and regional presence that is able to attract membership from all countries in theregion. Membership is key for survival of any business organization.