Poor transport and logistics infrastructure hindering intra-Africa trade - Report

A recent report by the Mauritius Commercial Bank Group has revealed that poor transport networks and logistical infrastructure are among the key hindrances to intra-Africa trade.

The report, dubbed Harnessing Africa’s Trade Potential: Strategies for Sustainable Growth highlights the region’s trade opportunities and structural challenges.

According to the report, shipping a container from Mombasa to Kampala can cost more than shipping it from China to Mombasa.

This, the report says, highlights the inefficiencies that hamper intra-African trade, which still only accounts for 16% of the continent’s total trade.

CEO of MCB Group Thierry Hebraud said Africa’s trade potential remains "tangible and sustainable" if supported by the right financial solutions.

“Despite global uncertainty, Sub-Saharan Africa’s GDP is expected to grow by 4.2% in 2025, driven by a gradual recovery and easing supply constraints,” Hebraud said.

For East Africa, and Kenya in particular, several key priorities emerge to foster sustainable economic growth.

Projects like the Standard Gauge Railway and port expansions in Mombasa aim to reduce these barriers and strengthen regional connectivity.

“East Africa, like much of the continent, relies heavily on raw commodity exports such as tea, coffee, and minerals. The report recommends economic diversification through agro-processing, textiles, and renewable energy,” the report said.

The reports note that the implementation of the African Continental Free Trade Area (AfCFTA) remains uneven, challenged by regulatory discrepancies, infrastructure gaps, and political friction. 

“By fostering stronger trade links within Africa, including by tapping into the opportunities offered by the African Continental Free Trade Agreement which brings together all the 54 countries in Africa, we can create more robust, self-sustaining economies that are less dependent on external markets,” Hebraud said.

However, the report cites Kenya as well positioned given that renewable energy already powers much of the country at lower costs than many global benchmarks.

“The informal sector continues to dominate, offering livelihoods but limiting productivity and fiscal capacity. Better structuring could help mobilize domestic resources and fund strategic investments,” the report  said.

“To address the region’s trade finance gap—estimated at $80–120 billion annually—is critical. Tools like the Pan-African Payment and Settlement System (PAPSS) and regional financial integration could ease cross-border transactions and foster more inclusive growth.”

To unlock East Africa’s trade potential, investment in infrastructure, and economic diversification fully, the report suggests financial innovation, and regional cooperation will be key.