Kenya is tightening its grip on regional trade with a $500 million (about Sh64.7 billion) World Bank-backed Eastern Africa Regional Transport, Trade, and Development Facilitation Project (EARTTDFP) initiative aimed at improving efficiency along the Northern Corridor, a critical route for commerce with South Sudan, Ethiopia, and Uganda.
This is after the Kenya Revenue Authority (KRA) unveiled three new trade facilitation centers in Kainuk, Lodwar, and Kakuma, a strategic move designed to stop smuggling, ease congestion, and boost tax compliance in one of East Africa’s busiest trade arteries.
The Northern Corridor has long been a lifeline for regional economies, yet inefficiencies, ranging from porous borders to customs delays have hampered trade flows. With Kenya bleeding billions annually to tax evasion and illicit trade, KRA Commissioner General Humphrey Watanga said the newly launched hubs are expected to transform revenue collection by decentralizing customs enforcement to Turkana County. KRA is betting on localized oversight to plug leaks in the system while reducing operational costs for traders.
“The facilities are critical in the movement of goods within this region and are expected to enhance KRA’s operations along the South Sudan link road. Today, we celebrate a monumental achievement in both trade facilitation and border security. This project will ensure our borders are secure, our business environment remains conducive, and society at large is protected,” Watanga said.
For years, Kenya’s border infrastructure has struggled to keep pace with rising trade volumes. The Malaba and Busia border posts, key gateways for cargo into Uganda and beyond have suffered from chronic congestion, creating bottlenecks that drive up costs for businesses. By establishing hubs further inland, KRA is shifting the burden away from overstretched checkpoints while bolstering oversight along alternative trade routes.
The move comes as KRA intensifies efforts to shore up revenue collection. In January alone, its Customs and Border Control division exceeded its revenue target by nearly 11 per cent, collecting Sh82.6 billion. Non-petroleum taxes rose 11.6 per cent, while petroleum taxes surged 55.9 per cent year-on-year, gains attributed to increased oil volumes and tighter compliance measures. With the new trade hubs in place, KRA is betting on even stronger returns.
Lilian Nyawanda, KRA’s Commissioner for Customs and Border Control, underlined the hubs’ role in unlocking economic potential. “In terms of trade facilitation, we are bringing services closer to the community, which will likely lead to a surge in economic activities. Turkana was selected due to its strategic location as a gateway to South Sudan,” she said.
The decision to base these hubs in Turkana County is no accident. Straddling the Lokichar-Nadapal-Nakodok route, Turkana is primed to become a key transit corridor for South Sudan-bound cargo. By cutting transit costs and creating a direct customs clearance point, the hubs could stimulate local commerce while enhancing Kenya’s role as a regional trade hub.
For businesses, the benefits extend beyond streamlined customs processes. Watanga said KRA’s decentralization plan eliminates the need for costly inspection deployments from Eldoret, further reducing logistics expenses.
These hubs also tie into Kenya’s broader economic agenda, complementing the Vision 2030 blueprint and the Lamu Port-South Sudan-Ethiopia Transport Corridor (LAPSSET) Program, both of which position Kenya as a regional leader in logistics and trade facilitation.
“These centers mark a significant milestone in strengthening economic ties with neighboring states while ensuring seamless movement of goods across borders,” Nyawanda said. KRA said the initiative will also secure trade routes and foster regional economic integration.
