Workers at the Eldoret International Airport pack a consignment of
avocados for export. The ranking is significant as it helps to gauge the
competitiveness of economies to facilitate flow of goods. PHOTO | FILE
|
NATION MEDIA GROUP
By Annie Njanja
In Summary
- Kenya’s poor ranking was mainly as a result of the numerous barriers faced by businesses entering the local market, low potential for businesses and challenging market environment.
- The index report contradicts the World Bank’s ease of doing business report covering the year ended June that placed Kenya at position 108 globally after jumping 28 places.
Kenya has been ranked behind Ethiopia and Tanzania in
a new global ranking which tracks the demand for logistics services,
market accessibility, security and transport infrastructure.
The Agility Emerging Markets Logistics Index 2015 shows that
Kenya is placed third-last at position 43 compared to Ethiopia (37)
and Tanzania at number 39. Forty-five countries were surveyed.
The ranking is significant as it helps to gauge the
competitiveness of economies to facilitate flow of goods and services
based on market size, business conditions, infrastructure and other
factors that make them attractive for investment.
Such surveys are important to logistics companies, air cargo carriers, shipping lines, freight forwarders and distributors.
Kenya moved one place up but posted a lower score
of 3.47 points out of 10, compared to 3.52 points last year. Uganda, a
land-locked economy that depends on the port of Mombasa for her exports,
was ranked last with a score of 3.31 points.
The performance of the East Africa states was mainly strained by poor connectivity due to bad roads network.
Doing-business report
Kenya’s poor ranking, according to the logistics
index, was mainly as a result of the numerous barriers faced by
businesses entering the local market, low potential for businesses and
challenging market environment.
The index report contradicts the World Bank’s ease
of doing business report covering the year ended June that placed Kenya
at position 108 globally after jumping 28 places.
Against last year, the World Bank reported that
Kenya had made more progress on various issues like ease on starting a
business, getting credit, paying bills, registering property and
acquiring construction permits.
According to the report Huduma centres which have
brought different government services under one shop across the country
improved Kenya’s likeability by removing bureaucracies that investors
face.
Despite the poor ranking, Kenya’s trade with the
European Union (EU) grew, placing the country at position five among
the air freight top ten trade lanes.
“Kenya to EU trade, 63.9 per cent of tonnage was
down to exports of flowers in 2013. For January-August 2014, exports of
flowers to the EU were up by 3,133 tonnes (5.1 per cent) on the
corresponding period in the previous year,” the report stated.
The Agility Emerging Markets Logistics Index termed
mining and humanitarian aid as the sectors with the greatest potential
for future growth in the sub-Sahara.
Most attractive
Placed at position 15, South Africa remained the most
attractive market and among the emerging markets with most potential in
the Sub-Sahara because of its “high market potential and few barriers
to market entry.”
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