Gov’t seeks to cut high road transport costs

Government is considering other alternatives of transporting of exports and imports in a bid to lessen costs. Currently transport costs tally with about 40 percent of the total value of imported and exported goods. Alexis Karani, Director of the Planning Unit in the Ministry of Infrastructure last week said that there are currently studies aimed at large scale regional projects to lower this cost of transport. These include Isaka-Kigali railway, river transport on Akagera River and the new international airport at Bugesera. Officials at the ministry said that there are also some transport facilitation initiatives which include a one stop border post programme, acquisition of modern equipment and the reduction of Non-Tariff-Barriers (NTB). According to the authorities, these are aimed at promoting Rwanda’s trade with other East African economies. Currently, Rwanda is over reliant on road transport which covers a total actual road network of 14,000km of which 2,860km are classified as national roads and 1,835km as district roads. Air transport consists of only two international airports at Kigali and Kamembe), and five aerodromes which are spread across the country including Gisenyi, Butare, Ruhengeri, Nemba, and Gabiro. Water transport in the country is limited to Lake Kivu and there is no rail transport system in the country at the moment. The rolling terrain and heavy rainfall raises the cost of road construction and maintenance, which are said to be the highest in Africa. “High transport costs have a strong negative impact on economic growth and development,” Karani said. Karani was speaking at the launch of the Transport Sector Development Project. During his presentation he noted that in developed countries, road transport accounts for, between 6.5 percent and 11 percent of the total value of imports or exports. The ministry is optimistic about meeting the Economic Development and Poverty Reduction Strategy targets of cutting transport costs for passengers and goods nationally and internationally by 10 percent in 2012. It also target 31 percent of rehabilitated and maintained classified road network and 15 percent reduction in road traffic accidents. The strategy is expected to strengthen institutional framework, reduce transport costs for domestic products and internationally tradable goods. It is also intended to ensure quality and durability of rural, urban and international transport network. World Bank officials who issued a grant to support the initiative said it would improve safety for goods and passengers on the principle modes of transport. The Transport Sector Development Project is also expected to improve the quality of Rwanda’s paved road network and to generate sustained employment in rural areas through road maintenance works. Ends

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Gov’t seeks to cut high road transport costs