Enhancing Trade Efficiency with Local Marine Insurance
In Uganda, a significant shift is underway to improve logistics for traders. Local marine cargo insurance is gaining traction as a vital tool for enhancing trade efficiency. This initiative aims to empower small and medium enterprises (SMEs) by addressing the logistical challenges they face. Emmanuel Karugaba Neezha, the CEO of DESLER LOGIS U LTD and Vice Chairman of the Uganda Consolidators Association (UCA), recently shared insights on this transformative initiative. Founded in 2019, the UCA represents businesses involved in importing and exporting consolidated cargo. The association’s mission is to tackle the high costs associated with logistics, which have long hindered the growth of SMEs in Uganda. With 26 registered member companies operating in key markets like China, Dubai, Turkey, and Vietnam, the UCA is poised to make a significant impact on the local trade landscape.
Benefits of Local Marine Cargo Insurance
Local marine cargo insurance offers a solution to the hidden costs that traders often encounter. Traditionally, small traders struggled to access compensation for losses or damages during shipping. They relied heavily on consolidators to mediate claims, which often led to delays and frustrations. With the introduction of local marine insurance, traders can now address their losses directly and independently. This empowerment enables them to operate more efficiently and confidently in the market.
Karugaba emphasized the importance of this initiative in providing a streamlined process for compensation. By allowing traders to engage with insurance providers locally, the initiative fosters accountability and transparency. The Uganda Insurance Association (UIA) has developed an online portal that allows consolidators to apply for marine insurance on behalf of individual traders. This system ensures visibility of premiums paid and enables traders to follow up on claims independently. Such advancements are crucial for building trust and improving the overall trading experience.
Moreover, the UCA is actively working with key stakeholders, including the Uganda Revenue Authority (URA) and clearing agents, to ensure a smooth rollout of the insurance initiative. Training sessions and information dissemination efforts are already underway, aimed at equipping traders with the knowledge they need to navigate this new landscape. Karugaba’s optimism about the initiative’s potential reflects a broader vision for enhancing Uganda’s trade and logistics sector.
Challenges and Future Prospects
Despite the promising outlook, challenges remain, particularly concerning foreign marine insurance. Karugaba pointed out that such policies often exclude the final importer from direct participation, leading to issues of accountability. This gap can create complications in the claims process, leaving traders vulnerable. The introduction of local marine insurance addresses these concerns by allowing traders to engage directly with service providers.
Karugaba encourages importers to embrace this initiative, highlighting its potential to foster collaboration with credit financiers. By bringing traders closer to insurance providers, the initiative not only enhances business sustainability but also promotes growth within the sector. As the UCA continues to engage with stakeholders, the implementation of local marine insurance is expected to significantly reduce costs and improve efficiency for Ugandan traders.
