Ideas sought for lifting EAC transport

TradeMake East Africa (TMEA) through the Logistics Innovation for Trade (LIFT), a development finance instrument that provides grant finance for innovative business projects proposed by the private sector operating in the transport and logistics sector in East African, has secured $7.6 million for Round 2 funding. In an interview DAVID MITCHELL, LIFT Fund Manager tells Sam Okwakol, how and what one needs to do in order to benefit from the Fund. 

QUESTION: Briefly explain, what LIFT is to an ordinary reader?

ANSWER: LIFT is a challenge fund that rewards innovation ideas/project in the logistics and transport sector within the East African Community with grant funding.

LIFT funds innovative logistics projects (not companies) ideas that provide sustainable solutions with measurable socio-economic impacts. Funds are provided by means of grants, matching applicants funding up to $1 million (LIFT contribution) per project.

Why did you choose this approach in implementing LIFT?

This is a historic idea which has been used successfully in different parts of the world.

We have adopted it to harness the potential and energies of individuals in the private sector to derive solutions that can reduce the logistical and transport challenges facing the region. East Africa has well educated people with good ideas, can do research and most of all care about the development of their countries.

Therefore capturing their potential will help us find solutions to reduce transit time and transport cost challenges faced by the logistical and transport sector, while at the same time helping in reducing the unemployment gap.

What project or project ideas are you looking for?

LIFT is looking to fund projects that seek to reduce the costs of transportation and logistics services for customers. Projects that can reduce the time in transporting and delivering goods to customers and suppliers, and projects that can improve the competitiveness of small and medium transport and logistics companies in the East African Community (EAC).

How can someone participate in the Second Round of LIFT?

Investment and innovation in the transport and logistics industry in East Africa is huge. The range of possible project interventions being wide, logistics innovations are usually classified into two broad groups: technological and management process.

You can submit Concept Notes and Proposals through email provided for in the LIFT website.

What are the underlined objectives and outcomes of the 2nd round of LIFT?

The Fund aims to support TradeMark East Africa’s target of reducing transport costs and transit times along the main transport corridors in East Africa and to reduce the risk of investing in disruptive innovative technologies or improved practices that will have a significant impact on efficiencies in the transport and logistics industry in East Africa.

How has the region responded to LIFT? 

We have funded nine projects in East Africa during the first round.

Four of the projects funded were generated from Kenya, two in Tanzania and Uganda alone got three projects, this demonstrates a great potential and I can therefore say, the response is good and encouraging.

We hope to fund more projects in the second round, 10 or more projects for each EAC member state would not be bad.

Which other support do you provide?

LIFT helps selected projects to negotiate for additional funding from banks. LIFT also has own budget for media. We help projects strength their communication and marketing components.

We have realized most entrepreneurs in the logistics and transport sector lack well established communication departments and as a result, their brands and products are not well known. LIFT therefore helps such projects develop their own communications frameworks such as websites among other communication and marketing tools that can cater for their communications needs.

Who participated in the first round of LIFT?

In the first round, LIFT funded Alistair James Company Limited a tracking and matching platform, Logistics Innovation & Information System East Africa (LOGISA), SPEDAG Interfreight (K) Limited a new Intermodal Freight Transfer Facility Project at the Malaba Railway Yard, CYBERMONK Software Development a C&F Pro online Freight Forwarding Logistics Solution, LETSEMA Consulting an East African Joint Operating Centre and Control Tower, MiX TELEMATICS an electronic container based cargo movement management company in East Africa among others.

One of the challenges facing the northern transport corridor is transit time and high cost of transport, did LIFT Round One help in addressing this challenge?

We have not yet realized any of the above. The first round of LIFT targeted setting the ground for the implementation of the project but there are positive and promising indicators to achieve all of the above especially in the second round of the fund.

What challenges did you face in the implementation of the first round of LIFT?

There was a challenge in candidates with insufficient capital resources to implement projects, LIFT requires successfully applicants to have matching finance to be considered. On the other hand, inadequate availability of up to date information and statistics regarding the logistics sector in the East African, long timelines to get projects to completion, difficulty in measuring the inputs and milestones in ICT projects and resistance from applicants to sharing data are some of the challenges encountered in the first round of LIFT.

How have you prepared the masses in adopting LIFT?

We have created awareness through different engagements like workshops where we encourage innovative business entrepreneurs to take up opportunities presented by LIFT across East Africa.

Courtesy of BusinessWeek

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