$16m earmarked for reducing regional transport costs

Challenge Fund aimed at embracing new innovative ideas tailored to reducing time and transport costs in the East Africa region.

LIFT Challenge Fund Manager David Mitchell said yesterday while launching the $16m fund for innovators and entrepreneurs engaged in the logistics and transport sector in Tanzania.

Mitchell said $16m was a grant-based financial mechanism that supports innovators with good business ideas or concept for products or services that can reduce the cost of transport and logistics in East Africa region.
The main goal is to promote innovation and efficiencies in the transport and logistics sector in East Africa.

“I call upon all SMEs and innovators working in the logistics and transport sector in Tanzania to use this opportunity and submit their innovative business concept proposals to LIFT for possible funding,” he said.

During implementation, LIFT will provide grants ranging from $150,000 to $1,000,000 to winning proposals from innovators across the country whose project ideas would be implemented in the East African Community (EAC) bloc.

LIFT Challenge Fund is a project of TradeMark East Africa (TMEA) that seeks to stimulate the creation of innovative transport and logistics products that will lead to improved efficiency and services quality within the EAC.

He said successful LIFT projects will contribute to Trade Mark East Africa (TMEA’s) objective of reducing transport time along the main East Africa transport corridors by 15 per cent by the en d of this year.

Besides, LIFT Challenge Fund is open to businesses and individuals throughout the world that are either presently operating or intended to be based in the EAC region.

Businesses in the transport and logistics sector or those that provide services to across within it are now being invited to submit their innovative concepts to LIFT for possible funding.

The launch follows a successful inaugural round that saw nine awards to projects that are touched deliver a significant reduction in time and transport costs in their area of operations.

“We have decided to launch a second round of challenge Fund after identifying that East Africa region is reported to have the highest freight and transport costs in the world and over 50 percent higher than the USA and Europe per kilometer,” he said.

Transport costs for landlocked countries in the region can be as high as 75 percent of the value exports.
Also transit times have the most significant effects on exports and also result in firms having to carry higher levels of stocks making them less efficient.

According to him, LIFT aims to reduce investment risk in transformative technologies that will make a real difference to the region’s trade and logistics efficiency.

The application period will remain open for the submission of project concepts notes to August 12th 2016 and the grant will be awarded for successful applicants who will be required to provide matching funds of at least 50 percent of the project values.

On the other hand the TMEA’s Country Director Dr Josephat Kweka added that right now they invite innovators and all businessmen engaged in transport sector to use this opportunity to introduce new technology or services that will reduce time and cost of transport and ensure better coordination of the logistics chain in EAC.

“We need innovators or entrepreneurs who will come up with new technology or ideas that will help our farmers transport their crops from the farm to the market in a conducive environment, help our businessmen reduce the transport costs for the business s they carry out and benefit from it,” he said.

The main goal was just to attract private sector companies introduce new innovative ideas that will reduce the costs of transport and logistics in East Africa, bring profit and even help farmers benefit from it.

“We are expecting that all entrepreneurs and innovators engaged in transportation sector of the East African Community in Partnership with their counterparts internationally will drive forward development through the adoption or introduction of the best practice technologies in the transport and logistics sector,” he said.

This will enable local businesses to compete favorably in the increasingly global economy.LIFT is a valuable financial instrument that supports private sector to develop and test new ideas that should reduce the cost and time of transport and logistics in the EAC.