Kenya’s manufacturing sector has called for urgent action to address logistics bottlenecks that continue to undermine competitiveness and limit the country’s ability to fully benefit from the African Continental Free Trade Area (AfCFTA). This was during the launch of the Logistics Study Report by Kenya Association of Manufacturers (KAM).

Findings from the report reveal that logistics costs across key trade corridors remain high and unpredictable, often outweighing the benefits of tariff reductions under AfCFTA. For instance, transporting a 20-foot container along the Nairobi–Lusaka corridor costs between USD 3,500 and USD 7,000, with transit times ranging from 8 to 30 days depending on border conditions and operational disruptions.

The study further highlights that while AfCFTA has opened access to 54 countries, the ability of Kenyan manufacturers; particularly SMEs, to access these markets is constrained by inefficiencies in logistics systems, including border delays, infrastructure gaps, high freight costs, and limited cargo consolidation mechanisms.

Speaking during the launch, Principal Secretary, State Department for Trade, Dr. Juma Mukhwana, CBS, highlighted the role of government in creating an enabling business environment and addressing structural barriers to trade.

“The work of government is to develop the right policies and ensure the business environment is conducive for enterprises to grow. Kenya’s time is now, and Africa’s time is now. We must move from exporting raw materials and importing finished goods to building value locally and regionally. This calls for investments in infrastructure, support for SMEs, and stronger regional integration. Africa remains a fragmented market, and aligning standards and systems will be key in unlocking its full potential,” said Dr Mukhwana.

He noted that ongoing government interventions, including investments in infrastructure such as the Standard Gauge Railway and the development of County Aggregation and Industrial Parks(CAIPs), are aimed at improving efficiency, supporting industries, and enabling SMEs to access raw materials and markets more effectively.

KAM Chief Executive, Tobias Alando, emphasized that logistics, not market access, is now the defining constraint to competitiveness. “The African Continental Free Trade Area brings together 54 countries into a single market, creating significant opportunity for Kenyan manufacturers. But there is a clear gap between that opportunity and reality. While markets are opening, the systems that connect us to those markets are not moving at the same pace. This report confirms that the challenge is no longer just access, but the cost, efficiency, and predictability of moving goods. In many cases, logistics costs now outweigh the benefits of tariff reductions, meaning that even when markets are open, products are not competitive by the time they arrive.”

Representing the SME perspective, KAM SME Hub Chair and Founder of Harriet Botanicals, Harriet Ngo’k, highlighted the disproportionate logistics burden faced by SMEs despite their critical role in the economy. She reiterated, “I export to over 50 countries, and the cost of moving goods is one of the biggest challenges we face as SMEs. For products worth KSh 30,000, it costs me KSh 14,000 to get them to Rwanda, KSh 17,000 to Nigeria, KSh 38,000 to Australia, KSh 30,000 to the U.S., and about KSh 10,000 to Qatar. These costs are high and unpredictable, and they directly affect where and how we can trade.” 

She also noted that inefficiencies across key trade corridors continue to limit competitiveness: “On routes such as the Lusaka corridor, transport costs remain high and transit times are unpredictable, with delays at borders slowing movement despite high traffic volumes. For SMEs dealing in perishable goods, these delays translate into direct losses: My products have a shelf life of three to six months, yet it can take seven to ten days just to reach nearby markets like Uganda. By the time they arrive, I have already lost part of that shelf life, and there is always the risk of rejection.”

TradeMark Africa Country Director, Lilian Mwai, noted that the study provides a critical foundation for targeted reforms to unlock trade and strengthen manufacturing competitiveness. “TradeMark Africa is proud to have partnered with KAM on this initiative. This study goes beyond identifying challenges: it pinpoints the real bottlenecks affecting Kenyan manufacturers, particularly SMEs. From high clearance costs to infrastructure delays and inefficiencies in logistics systems, these are issues that must be addressed to unlock intra-African trade and enable businesses to compete effectively.”

The report recommends targeted interventions to address these constraints, including improved coordination across border agencies, investment in reliable and efficient infrastructure, and the development of cargo aggregation mechanisms to support SMEs in reducing logistics costs and improving market access.

The preparation of the Logistics Study Report was made possible through the support of TradeMark Africa (TMA), with funding from the Foreign, Commonwealth and Development Office (FCDO) of the British High Commission in Kenya, in support of efforts to strengthen trade facilitation and export competitiveness.