Inside Politics

Kenya eyes top three rank in Africa’s port business

Tuesday, October 1st, 2019 03:13 |

The commissioning of four more ports in Kenya in the next few months will increase space for more containers and projected to improve efficiency as the country eyes position three in Africa in terms of rating according to Kenya Ports Authority (KPA).

Currently, Kenya is ranked number five after Egypt, South Africa, Nigeria and Morocco due to increased efficiency in handling cargo and the rising volumes of cargo in containers.

The ongoing construction of Lamu port; Shimoni fishing port; the Inland Container Depot in Naivasha and the lakeside Port of Kisumu are at an advanced stage of completion.

Managing director, Daniel Manduku told People Daily that KPA projects to cross 1.3 million TEUs mark at the end of the year from 1 million TEUs achieved last week.

“We are optimistic to move up to No. 3 from the current No. 5 in Africa by the end of the year. Ports are rated in how efficient they are, and the volumes of cargo they handle. We believe we are improving tremendously; seeing the volumes of cargo coming in rising every week, and the way we handle it,” he said.

However, even as KPA continues to increase in annual cargo handling capacity steadily for the last 11 years, it is concerned that port business is becoming a challenge with cut throat competition among ports each wanting to be a Hub Port.

“In the West African region, for instance, several countries in that area are coming up with ports, thereby calling on us to put huge investments in the ports. However, with the Standard Gauge Railway (SGR), which promises to offer better connectivity, we will be there,” Manduku said.

In the numbers released last week, it showed that annual handling capacity at the Port of Mombasa had increased from 250, 000 TEUs in 2008 to the current above 1.30 million TEUs. With the recent reclamation of 100 acres of land from the sea in Phase 1 of the port's expansion programme, it will see an additional 550, 000 TEUs container terminal capacity.

"Normally in the maritime sector the one Million TEUs is very high threshold and I am happy to note that almost four months before the close of the year we have attained it. Going by our daily handling of between 3500 TEUs and 4000 TEUs simple arithmetic tells us that we might even surpass 1.4 million TEUs," said Manduku during a recent tour of the Second Container Terminal.

Currently, KPA is reclaiming 50 more acres from the sea for Phase 2 expansion of the Second Container Terminal, which, upon completion in the next four months according to Manduku, would give the Port an additional capacity of 450,000 TEUs giving it a total capacity of one Million TEUs.

“We would have established the capacity to handle 3 million containers annually,” he added.

In the KPA Master Plan 2018-2047 launched in July this year, the government is keen on addressing a number of matters arising in the global maritime industry as well as the local Maritime Transport sector. The Master Plan, Manduku said presents a blue print that will define the KPA's development horizon over the next 30 years.

“Globally, the ships are growing bigger in size as ship owners want to leverage on more profits by carrying more cargo running few ships, while shippers want to get lower freight costs through economies of scale. The biggest ships in the market, such as Maersk Emma, MSC Oscar, and others, are now almost 20,000 TEUs capacity.

“Ports thus face the challenge of providing space to accommodate these monstrous ships, and that's the reason why we are continuing to expand. In the coming years, we will reclaim more land from the sea, as we believe that the future of efficient cargo handling is more in the containers, this, more space,” he added.

And during a tour of the ICD in Nairobi, Head of KPA Corporate Affairs, Bernard Osero expressed satisfaction with the performance at the Inland Port saying it has continued to record high-efficiency levels.

"A year ago the cargo dwell time at the container depot was 23 days. Today I am happy to note that 80 percent of all cargo is leaving the Inland Container Depot within four days and our average dwell time has gone down to below six days. This is because of the efforts by both Government agencies and the private sector in ensuring that we make business smooth and efficient," he told People Daily.

He said since the SGR cannot stand alone without being complemented with other facilities for delivery of the goods and services and efficiency of the cargo handling process, the situation thus creates the need for the establishment of inland container depots.

Osero said KPA is in the process of looking at possibilities of identifying others along the corridor and border points to facilitate trade.

“In terms of cargo evacuation from the Port of Mombasa to the ICD- Nairobi by the SGR, currently there's an average of 8 to 10 trains each carrying 108 containers daily,” he said.

In 2017, the port throughput performance grew from 30.34 million tons to 30.92 million tons in 2018 representing a growth of 1.9 percent.

Osero attributed the increased cargo volume mainly to the containerised cargo which posted a notable increase of 10 percent, accounting for 41 percent of the total throughput in 2018.

The ICD Nairobi container traffic performance data shows that 277, 347 TEUs were recorded at the in August 2019 from 175, 156 imports in the same period in 2018 when 257, 972 TEUs were entered from 177, 652 imports.

KPA is projecting this to grow to 429, 848 TEUs from 273, 420 imports.

“Our import cargo dwell time has also reduced from over 13 days last year to current 6 days, and over 50 percent of cargo being cleared within 4 days free period,” he added.

However, with the rosy numbers, players in the transport and logistics industry have stated that this will push them out of business.

There are about 7, 500 trucks on the highway between Mombasa and the Kenyan borders.

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