Eliminating inefficiencies, excess documentation and regulations would lower costs, making the region competitive in world markets
April 22, 2010 – A comprehensive study of transport and logistics costs on the Tema-Ouagadougou corridor shows what is driving the costs – and what can be done to lower them.
“It costs about US$3,200 and takes anywhere from 13 to 22 days to bring a container from a vessel in Tema port to the importer in Ouagadougou,” said Trade Hub Transport Director Niels Rasmussen. “To move one the same distance in the United States – from Newark to Chicago – costs about $650 and takes just five days. This is even more remarkable when you realize that labor costs in the U.S. are 25 times higher.”
Lowering West Africa’s transport costs – among the highest in the world – is critical.
“High transport costs ultimately mean consumers pay more for goods at market and in West Africa, where people spend as much as 80% of their incomes on food alone, that is very important,” said Trade Hub Director Vanessa Adams. “And high transport costs also make it very hard for exporting companies to compete in world markets. When they cannot compete, they do not create the jobs that West Africans need.”
To lower the costs, private and public stakeholders must collaborate to:
Since 2006, the joint Trade Hub-UEMOA road harassment reports have raised awareness along trade corridors in Burkina Faso, Ghana, Mali and Togo. Cote d’Ivoire and Senegal recently joined the initiative and the World Bank’s Abidjan-Lagos Corridor Organization is a key partner.