Africa can not trade its way to prosperity unless governments rethink their role in transport

By Kweku Attakora Dwomoh

The African Continental Free Trade Area (AfCFTA) promises to create a single African market,
deepen regional value chains, stimulate industrialisation, and increase intra-African trade. Yet, despite these lofty aspirations, one inconvenient reality continues to undermine the continent’s
trade agenda: Africa still struggles to move people and goods efficiently within its own borders.

For decades, African governments have invested heavily in transport infrastructure while simultaneously assuming responsibility for operating transport services.

State-owned bus companies, railway corporations, shipping lines, and other transport enterprises were established with the objective of making transportation affordable and accessible to citizens. These interventions were well-intentioned.

Transport is an essential public service and an indispensable
driver of economic development.

However, experience across much of the continent
demonstrates that governments have generally performed better as providers of transport infrastructure than as operators of transport services.

This is not an argument for abandoning the transport sector to the private market. Rather, it is an argument that governments should redefine their role.

The modern state should concentrate on
creating the legal, regulatory, and institutional environment within which efficient transport services
can flourish while allowing competent private operators to deliver those services under transparent and accountable regulatory oversight.

The distinction is significant. Governments must continue to invest in strategic public
infrastructure such as roads, bridges, ports, rail corridors, and airports because these assets possess characteristics of public goods and require substantial capital investment beyond the capacity of many private actors.

Operating commercial transport services, however, is fundamentally different.
Bus operations, freight logistics, passenger rail services, and cargo handling are commercial activities that, when properly regulated, can often be delivered more efficiently by the private
sector.

Africa’s experience provides ample evidence for this proposition.

Across many
jurisdictions, state-operated transport enterprises have become synonymous with
operational inefficiency, ageing fleets, inadequate maintenance, financial losses, and recurring
dependence on public subsidies.

Political considerations frequently influence managerial decisions, procurement processes, and pricing structures. Changes in government often result in changes in management, making long-term planning difficult.

In many instances, transport companies
become vehicles for political patronage rather than institutions focused on service delivery.

The consequence is borne not only by commuters but by the wider economy.

Transport costs remain among the highest in the world. According to the African Development
Bank, logistics inefficiencies, and inadequate transport connectivity significantly increase the cost
of moving goods across the continent, reducing the competitiveness of African businesses and
limiting the potential benefits of regional integration. It is often cheaper to import products from outside Africa than to transport similar goods between neighbouring African countries. Such a situation defeats the very objectives that AfCFTA seeks to achieve.

Indeed, trade
liberalisation alone can not create competitive markets if goods can not move
efficiently.

Reducing tariffs is only one component of economic integration.

Businesses equally require reliable
transport systems, efficient logistics networks, modern ports, functioning railways, and predictable customs procedures. A manufacturer in Kumasi who can not transport processed agricultural
products to
Ouagadougou within a reasonable period derives little practical benefit from reduced
tariffs under AfCFTA.

Similarly, farmers who can not move produce quickly from rural communities to urban markets continue to incur post-harvest losses irrespective of favourable
trade policies.

This explains why transport reform should no longer be viewed merely as an infrastructure issue.
It is fundamentally a trade issue.

Successful African examples demonstrate that governments need not operate transport services in
order to ensure public access.

The concessioning of container terminals at the Port of Tema and the development of the Lekki Deep Sea Port in Nigeria illustrates how private investment, under appropriate regulatory
frameworks can improve efficiency while governments retain ownership and oversight of strategic infrastructure.

Similarly, several African cities have increasingly adopted franchising arrangements
under which governments regulate routes, service standards, and fares while private operators provide the actual transport services.

These models recognise an important economic principle: ownership is not synonymous with
operation.

A government may own an airport without operating every airline. It may own railway
infrastructure without running every train. It may own bus terminals without managing every bus company.

What matters is that the government establishes clear legal rules governing market entry, safety standards, competition, consumer protection, and accountability.

Where effective regulation exists, private participation often introduces innovation, operational efficiency, and investment that governments, constrained by fiscal pressures, may struggle to provide.

This is particularly important at a time when many African governments face mounting public
debt and increasing pressure on national budgets. Every cedi, naira, or rand committed to subsidising inefficient transport operations represents public resources that could otherwise be
invested in healthcare, education, agricultural modernisation, or transport infrastructure itself.

Government resources should, therefore, prioritise infrastructure development rather than
commercial operations.

This is not to suggest that private participation is without risks. Left entirely unregulated, private operators may abuse market power through excessive pricing, poor service quality, or anti competitive conduct. Indeed, experience from digital markets demonstrates that private actors
may engage in exploitative practices where regulatory oversight is weak.

The appropriate response,
however, it is not for governments to replace private enterprises but to strengthen regulatory
institutions.
Competition authorities, transport regulators, and consumer protection agencies must, therefore
play a more proactive role in ensuring that liberalised transport markets remain competitive,
transparent and responsive to public needs.

Governments should equally strengthen the legal architecture governing public-private
partnerships and concession agreements.

Procurement processes must be transparent, concession
terms should be publicly accountable, and performance standards must be clearly measurable.

Where operators fail to meet agreed service obligations, regulators should possess adequate powers to impose sanctions or terminate concessions.
Good governance, rather than public ownership, is what ultimately determines successful transport
systems.

The AfCFTA itself provides an opportunity for African governments to rethink transport policy
from a continental perspective.

Cross-border rail corridors, harmonised transport regulations,
interoperable customs systems and coordinated logistics networks require collaboration between
states and active participation from private investors.

Achieving these objectives will demand legal
certainty, regulatory consistency, and investment-friendly policies capable of attracting long-term
capital into Africa’s transport sector.

Ultimately, the question is not whether governments have a role in transport.

They unquestionably
do. The real question is what that role should be in a twenty-first-century economy increasingly
driven by efficiency, innovation and regional integration.

The state should remain the architect of transport policy, the builder of strategic infrastructure and the guardian of public interest.

It should establish the legal and institutional framework within which transport markets operate fairly and efficiently.

What it should progressively move away from is direct
participation in
commercial transport operations where competitive private
enterprise can deliver better outcomes under effective regulation.

Africa’s economic transformation will depend not merely on producing more goods but on moving them faster, cheape, and more reliably across the continent.

If AfCFTA is to fulfil its transformative promise, transport reform cannot remain an afterthought.
It must become a central pillar of Africa’s development strategy.

Governments should therefore focus less on operating buses, railways, and logistics companies and more on building the legal, regulatory, and physical infrastructure that enables efficient transport markets to thrive.

Only then can Africa begin to realise the full economic potential of its continental market.

The author is an Africanist and an advocate for the African Union’s Agenda 2063, with a keen interest in governance, trade, and legal reform across Africa.