Kenya, Ethiopia ink bilateral deal to enhance cross border transport

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Addis Ababa, 26 April 2014 (WIC) - Kenya and Ethiopia on Friday signed a bilateral agreement to develop a One-Stop Border Post at Moyale in northern Kenya to boost trade between the two countries.

A joint statement from Kenya's transport ministry said the deal seeks to enhance transport services along the border crossing, strengthen trade in the region as well as reduce transit time for goods across the common border, including enhancing immigration processes.

"The two governments have formally inaugurated a Joint Transport Corridor Commission of ministers, which is expected to speed up the completion of projects within reasonable timeframe," it said.

"This is expected to create the required seamless transport connectivity between the two countries."

Trade volumes between Kenya and its northern neighbor are expected to rise from their current volumes. Kenya's exports to Ethiopia in 2011 were worth 55 million dollars. The country in turn imported goods worth 4.25 million dollars.

Under the Special Status Agreement, Ethiopia also agreed to eliminate non-trade barriers for Kenyan companies by giving land on a lease basis, tax holidays and non-collateral bank loans making it very attractive to investors.

The country has the lowest electricity tariffs in the world costing 0.03 dollars per kilowatt-hour (KWH) and a youthful labor supply with a population of 84.73 million with an average age of 28 years.   

Kenya is facing a deficit in energy production and so the government has embarked on an ambitious electricity generation plan that will see the government add 15,000MW of electricity to national grid by 2030.   

The agreement signed by Transport and Infrastructure Minister, Engineer Michael Kamau on behalf of the government and Ethiopian Minister for Transport Workneh Gebeyehu would facilitate gradual removal of non-tariff barriers and improve railway services between the two countries.

The two governments seek to fast-track implementation of the Mombasa-Nairobi-Isiolo-Moyale-Addis Ababa transport and the development of Lamu-Isiolo-Moyale-Addis Ababa transport corridors.   

Kenya and Ethiopia said they are determined to address bottlenecks relating to high transport costs, transit delays at entry and exit border points, inadequate infrastructure and poor management of transport systems.

The two have agreed to do away with bureaucratic procedures and devise mechanisms to enhance coordination along the Mombasa to Addis Ababa transport corridor.   

The two countries in 2012 launched the technical corridor coordination committee at the principal secretaries' level and soon after established a joint Kenya-Ethiopia Commission at ministerial level for the Mombasa to Addis Ababa transport corridor.   

The latest agreement empowers the technical coordination committee to develop modalities on how to mobilize resources and implement the projects components to be undertaken jointly by the two governments. (Xinhua)