WHY EAC SHOULD LAUNCH ITS OWN SHIPPING LINE

Development Talk Elly Manjale

East African countries conduct significant trade with the rest of the world. According to the EAC Trade & Investment Report 2023, exports from the region amounted to USD 26.9 billion, while imports reached USD 53.6 billion, bringing total trade to USD 80.6 billion. Most of this commerce is handled through maritime frontiers using foreign shipping lines, resulting in the region paying billions of dollars to overseas carriers. Establishing a joint shipping line would allow the East African Community (EAC) to capture part of this expenditure and retain it within regional economies.

In advocating the establishment of a joint shipping line, cognisance is given to ongoing initiatives aimed at forming a regional shipping line through a coalition of 19 states in Eastern, Southern and Northern Africa. This project — the Maritime Organisation for Eastern, Southern and Northern Africa (MOESNA) — is already underway.

A regional shipping line is not simply an option; it is an imperative, offering several clear advantages.

First, a regional carrier could substantially reduce freight and logistics costs across EAC economies. The region currently pays an estimated USD 3 billion to foreign shipping lines. By “ring-fencing” this amount, the resulting savings could translate into cheaper industrial inputs, lower consumer prices, and improved export margins for sectors such as horticulture, coffee, tea, and minerals.

Second, a regional shipping line would retain more maritime value-chain revenue within East Africa.

Third, shared ownership enhances bargaining power and supply-chain resilience.

Finally, a regional line would promote equity for landlocked states by ensuring access and predictable tariffs along inland corridors.

In conclusion, a joint East African Community shipping line should not be viewed merely as a nostalgic echo of the past, but as a practical, forward-looking instrument capable of reducing costs, retaining value within the region, and strengthening resilience in an era of volatile global logistics.

Leave a Reply

Your email address will not be published. Required fields are marked *