Is the Future of Africa’s Trade Corridors Green?
Trade corridors are transportation routes that connect major centres of economic activity, such as cities, ports, and industrial areas, to facilitate the movement of goods and services. These corridors can include a range of transportation modes, including highways, railways, waterways, and air transport, as well as the soft infrastructure and logistics services necessary to support these modes. It has been recognised as imperative that Africa prioritise the transformation of its key trade corridors to improve access to markets, connectivity between neighbouring countries, and access to seaports for landlocked countries. Given that the continent is in the relatively early stages of cross-border infrastructure investment and planning and the current continental drive towards infrastructure development (notably by the Programme for Infrastructure Development in Africa (PIDA)), there is an opportunity to consider integrating environmental criteria into all stages of freight transport system development.
Globally, there is a growing trend towards developing trade corridors with the intention of promoting sustainable freight transportation and reducing the environmental and social impacts of traditional transport modes. This includes efforts to prioritise the use of low-emissions transport modes, encourage modal shift (often from road to rail or water modes), support the development of clean energy infrastructure, minimize the impact of transport infrastructure on biodiversity, and promote energy efficiency. The development of these ‘Green corridors’ stems in part from a heightened awareness of the emissions intensity of the freight transport sector. At the global level, freight transportation makes up 40% of GHG emissions in the transport sector and 8% of total global GHG emissions. This share amounts to 11% if warehouses and ports are included.
Green corridors have been identified as offering a host of economic benefits. The use of energy-efficient technologies and infrastructure can be cost-saving, as can the implementation of green logistics planning through measures like transport route optimization and reducing packaging waste. A particularly attractive benefit of green corridors for the continent is the potential for attracting finance for cross-border infrastructure development, a task that has been historically proven extremely challenging. Despite some progress in infrastructure development, Africa still faces a significant annual financing shortfall in the range of $68–$108 billion, with the lack of adequate transportation infrastructure adding an estimated 30-40% to the costs of goods traded in Africa. To enable effective trade under the African Continental Free Trade Area (AfCFTA), an estimated $411 billion is needed to develop the necessary transport infrastructure. The global drive towards a low-carbon transition is shaping the way that infrastructure is financed and built. In the last decade, there has been a surge of sustainable’ infrastructure financing methods and investors are increasingly requiring that projects demonstrate a positive environmental impact. African cross-border transport infrastructure projects stand to benefit from this trend if they can effectively integrate, monitor, and report environmental costs and benefits.
A number of regional initiatives in Africa are taking steps towards the green corridor model. One of the earliest on the continent is the Northern Corridor Green Freight Programme which was launched in 2013 by the governments of the Northern Corridor Integration Projects (NCIP) member countries, namely, Kenya, Uganda, Rwanda, and Burundi. The programme is coordinated by the Northern Corridor Transit and Transport Coordination Authority (NCTTCA) in collaboration with development partners and the private sector. Its primary focus, detailed in the 2017 strategy document is on reducing emissions from road transport by promoting the use of fuel-efficient vehicles, the adoption of low-emission technologies, and the implementation of best practices in logistics management. While the strategy laid out a number of potentially effective interventions, there is little information on what progress has been made to date. The Northern Corridor Transport Observatory, which tracks the number of trade-related indicators for the corridor does not report any climate-related metrics. However, TradeMark East Africa is developing a tool for estimating GHG emissions associated with the corridor. The tool has already been implemented by the Central Corridor Transport Observatory which has reported on several emissions-related indicators since its launch in 2021.
Another project that is geared towards making regional trade-related infrastructure more sustainable is the Green Infrastructure Corridors for Intra-African Trade Programme which was launched by AUDA-NEPAD under PIDA. It is being implemented from 2021 to 2024 with support from the German government (Federal Ministry for Economic Cooperation and Development/Deutsche Gesellschaft für Internationale Zusammenarbeit). The aim of this initiative is to provide advisory services to African countries to develop climate-resilient, low-emissions infrastructure and attract green finance to promote regional trade under the AfCFTA. The Central Corridor, including Rwanda, Burundi, Tanzania, the DRC, and Uganda, has been chosen as the pilot corridor for the project. Other notable projects include the Alliance for Green Infrastructure in Africa and the AfCFTA’s green corridor portal which is still under development.
For initiatives like these to succeed, they will have to overcome the immense challenges associated with cross-border transport projects in Africa. Beyond infrastructure and capital constraints, there is the issue of regulatory harmonisation. The AfCFTA could be a step towards addressing this challenge when the Regulatory Cooperation Framework for Trade in Services (which will include transport services) is developed. Regional Economic Communities have started adopting measures, such as cleaner fuel standards in an effort to make freight transport more sustainable and reduce ambient air pollution. Continental efforts to coordinate these approaches before they are fully established will avoid future non-tariff barriers that result from a lack of regulatory alignment. An important first step would be the development of a continental green infrastructure policy to guide the development of trade corridors. The recently released African Union Climate Change and Resilient Development Strategy and Action Plan represents a missed opportunity in this regard as the section on ‘promoting low-carbon, resilient mobility and transport systems’ is brief and primarily focuses on passenger transport.
Beyond regulatory challenges, freight transport has been identified as one of the hardest socioeconomic activities to decarbonize given technical and logistical challenges. Rapidly evolving digital technologies can assist in overcoming some of these obstacles and should be leveraged by all stakeholders to support green trade corridor implementation. One example of this is the use of smart logistics systems that use real-time data and advanced analytics to optimize the routing, scheduling, and coordination of transportation; this can reduce the number of vehicles on the road, improve fuel efficiency, and minimize emissions offering environmental and trade benefits.
Trade facilitation initiatives under the AfCFTA are aimed at many of the same issues that green corridors are designed to overcome. Potential synergies between these efforts should be explored further to ensure the two approaches work together to create a more efficient, sustainable, and competitive trade system. For example, the trade facilitation agenda includes efforts to reduce the dwell time of trucks at land border crossings through developments such as pre-arrival processing; reducing these delays not only lowers trade transaction costs but also significantly decreases the CO2 emissions associated with idling fuel usage. Additionally, the trade facilitation agenda aims to promote the adoption of new technologies by border agencies and improve the publication and availability of information. These measures would advance the development of green corridors by improving the flow of information between trade officials and traders, allowing all stakeholders to plan for the environmentally and economically optimal utilisation of inter-modal transport and transport routes.
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