A Ugandan SME Navigates New Waters on Lake Victoria

This guest post was written by Nussi Abdullah of FIELD-Support, who was recently in Africa to conduct field visits with African Diaspora Marketplace grantees.

If you ask a Ugandan about taking a ferry across Lake Victoria, most will laugh and tell you “no way.” Ugandan ferries on this important trade route between Tanzania, Kenya and Uganda are notoriously dangerous and as a result, there are currently no passenger-friendly options originating and running regularly to/from Uganda. Businessmen hoping to do business with Kenya or Tanzania or vacationers seeking to explore their neighboring countries must either take a bus around the lake, or travel on uncomfortable cargo ships with their wares.

Earthwise Ferries, one of 14 winners of the USAID- and Western Union-funded African Diaspora Marketplace (ADM) business plan competition, managed by FHI 360 through the FIELD-Support LWA, is looking to change that. Earthwise has a three-pronged value proposition, explains Marketing Manager Norbet, “efficiency, safety, and fun! It’s a great boat!” The boats, with their GPS-equipped navigation systems and high-tech safety features, will cut travel time on the lake by about 40%. Earthwise is also bringing a “green” element to the fleet: ultimately all 10 boats serving ports in Uganda, Tanzania, and Kenya, as well as local tourist destinations such as Jinja (the source of the Nile) and the Ssesse Islands, will run on biofuels, which will be sourced from farmers in rural Uganda, giving farmers a stable and much needed market for their product.

The Earthwise ferry, with its shiny exterior, comfortable interior, and state-of the-art equipment is creating a lot of buzz. “We have small-scale merchants from Nairobi wanting to do trade with Burundi who are ready to start using the service… [and] Uganda relies on a lot of imports that will be much easier to get, for example from Mombasa in Kenya through Kisumu,” says Norbet. While many of the passengers are likely going to be the middle classes, the impact of increased (environmentally-friendly) traffic on the lake will be felt more broadly. The government has committed to improving the condition of the ports and is encouraging the private sector to increase its use. “This will have a good outcome in terms of livelihoods,” explains Operating Manager Allan, “for the people around the ports as well as Ugandan commerce overall.”

Earthwise’s journey hasn’t been easy. Last week, during a trial run, the engine sucked up something from the polluted lake which clogged up its intake valve and stalled the boat on the lake with two government ministers on board. The staff used the opportunity to make their case about the need to clean up the lake; the government has since arranged to provide a dredger to clean up the port area for Earthwise to dock more easily.

In June 2011, the First Lady of Uganda attended the soft launch and expressed her support. The official launch later this month will be attended by the President. Despite Earthwise’s auspicious start, investing in Uganda is not always straightforward. “Make sure you do your feasibility analysis,” says Allan when asked what advice he’d give to other SMEs. “Don’t make too many promises; start off low-key, and understand the competition that exists.” In charting these new waters, Earthwise is poised to set a new standard for safety and trade in East Africa.