Kenya Lands Digital Logistics Investment
A new digital logistics hub aims to elevate e-commerce and transform the trade landscape in Kenya.
Dubai-based trade technology solutions provider Webb Fontaine this week announced plans to partner with the Kenya Trade Network Agency to revolutionize the East African nation’s logistics industry with a digital platform that will spur development and growth.
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The Digital Logistics Market Place (DLMP) will connect public- and private-sector groups to simplify trade processes. It gives trucking companies, shipping lines, freight forwarders, importers, exporters, warehousing firms and insurance providers access to the integrated platform that allows them to compete for business.
“The DLMP is an online marketplace of trade,” Alioune Ciss, CEO of Webb Fontaine, said in a statement. “It offers B2B services to traders with seamless search, find, and send capabilities, fostering growth, reliability, and empowerment.”
Ciss said that the platform, which brings together all the stakeholders in the supply chain, will help businesses forge relationships with the service providers best suited to their needs and allow them to secure the best rates. It will also streamline the value chain, allowing collaboration to take place in the centralized hub, shaving time off operational processes.
Calling Kenya “an East African trade powerhouse,” Webb Fontaine said the DLMP has the potential to open up more efficiencies and e-commerce opportunities for the region. The country is among the biggest beneficiaries of the Africa Growth and Opportunity Act (AGOA), and the largest exporter of apparel to the U.S. under the trade preference program, generating $544 million in 2022. Almost 70 percent of those imports entered the U.S. duty-free under AGOA, while the remainder were also largely duty free under the Generalized System of Preferences (GSP) or Most Favored Nations (MFN) provisions.
Still, Kenya’s share of the U.S. apparel market remains relatively small, and the country’s government has doubled down on efforts to change that narrative in recent months. Earlier this week, Kenya’s Cabinet Secretary for Investments, Trade and Industry, Moses Kuria, met with government leaders and members of the public and private sectors to announce a Cotton Revival and Implementation plan designed to build up the nation’s cotton-farming industry to provide raw materials for its textile industry. Earlier this year, the government announced plans to invest $1.6 million to revitalize apparel factories and develop new cotton gins.
Though AGOA is to expire in 2025, many believe the bipartisan Congressional support is enjoys is likely to guarantee its renewal. As Africa becomes a larger player in the textile and apparel supply chain, foreign investment is pouring in from global governments and corporations.
In March, Norfund, the Norwegian government’s investment arm, announced a $14-million financing agreement with Sri Lanka-based manufacturer Hela Apparel Holdings PLC. The investment in the activewear, intimates and kids’ apparel maker will support the company’s Kenyan production facility, which employs 4,000 workers and accounts for 20 percent of the country’s total apparel export volume. In April, U.S.-based initiative Prosper Africa and the U.S. Embassy announced a $55 million investment from MAS Intimates, UAL, Mega, Coast Apparel, Best Lifestyle and NextGen. The funding will be used to expand export processing zones to support local apparel makers and U.S. fashion companies doing business in Kenya.
