31/03/2026
Ongoing disruptions across some international trade corridors continue to disrupt global shipping lanes, forcing major carriers onto longer, costlier routes and driving up freight and insurance costs for businesses.
For supply chain leaders in Kenya, these developments are more than an operational headache – they have a direct impact on cost structures, pricing strategies, and tax profiles.
What is often overlooked, however, is the tax implication. Under East Africa’s customs valuation rules, freight and insurance costs form part of the customs value – the CIF (Cost, Insurance and Freight) value – and therefore directly affect the customs duties payable. This means that even where commodity prices remain unchanged, businesses may still experience a sharp rise in landed costs due to freight-driven valuation adjustments.
With a significant number of vessels linked to regional trade reportedly delayed along key waterways, the compounding cost pressures are difficult to ignore.
For businesses navigating this environment, a few areas are worth close attention including, reviewing customs valuations to ensure that declarations accurately reflect actual freight and insurance costs, given that any under-declaration, even if unintentional, can attract penalties and interest; reassessing supply chain structures and their impact on landed costs and pricing; and re-evaluating supplier lead times and costing models that depend on predictable logistics flows.
In periods of heightened geopolitical tension, proactive planning is no longer optional. It’s the key to protecting margins, maintaining competitiveness, and ensuring business continuity.
