Since the Kenyan section of the Nairobi-Addis Ababa road corridor was completed in 2016, trade between Kenya and Ethiopia has increased while fares and traffic congestion have reduced. The Ethiopian section of the road will be complete in the first half of 2019.
The African Development Bank (AfDB) contributed $670 million (64 per cent of the total costs) to the project which is one of its key high 5 priorities.
The 895-kilometre road links Merille and Turbi towns in Kenya via Marsabit and links Ageremariam, Yabelo and Mega in Ethiopia.
The Benefits
The almost complete road corridor has offered a lot of benefits including increasing job opportunities and reducing travel time. The road has also positively impacted customs and inspections at the boarder by improving cross-border traffic of goods.
Cross-border traffic of goods has also been positive on the Ethiopian side where the road corridor is still unfinished.
Projections
AfDB predicts that trade between Kenya and Ethiopia will increase five-fold from $35 to $175 million by the time the entire project is complete.
“The intensity of foreign investment in the region in the period from 2016 to 2018 should further improve this performance. This is due to reductions in transport and shipping costs of goods and the expansion of markets beyond national borders. Average transport costs between the Kenyan towns of Isiolo and Merille, for example, should fall by half by 2019, from 0.49 cents to 0.28 cents a kilometre,” the bank states.
The bank also projects that the new road will increase the volume of goods being transported to and from Mombasa by 900,000 tons.
