Financial Times FT.com

Regional integration: Is location an asset or encumbrance?

By William Wallis

Published: September 22 2009 00:49 | Last updated: September 22 2009 00:49

Rwanda pays a heavy price for its geographical location. The cost of trucking a container from Mombasa on the Indian Ocean coast to Kigali, the capital, 1,500kms and three border crossings away, can be three times the price of shipping the same container from the US.

Transport alone accounts for more than 40 per cent of the cost of imported goods. In reverse, the premium that Rwanda’s quality tea and coffee exports attracts is eaten away by the slow journey from the country’s verdant hillsides to the auction rooms in Mombasa.

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