PUBLISHED ON June 2nd, 2023

Port users call for more collaboration with government

In Summary

  • Stakeholders said although efficiency at the Mombasa port has improved, there is still a lot of room for even further improvement.
  • The on and off delays in cargo delays experienced at the Mombasa port over the past few years have had a significant impact on trade, they said.

Stakeholders in the shipping and logistics sector have called for more collaboration between the government and the private sector to create a better and more enabling environment for trade.

Led by Kenya Ships Agents Association chair Sylvester Kututa, the stakeholders said although efficiency at the Mombasa port has improved, there is still a lot of room for even further improvement.

The on and off delays in cargo delays experienced at the Mombasa port over the past few years has had a significant impact on trade, they said.

In 2021, the ship dwell time was 4.3 days, an improvement from 2020 which was 4.4 days, but the stakeholders at the Trade Facilitation and Maritime Investment Workshop in Mombasa called and said more can be done.

“We are in the business of supply chain and logistics where all cargo and ships need to be moved seamlessly, meaning no stopping as much as possible.

“When we have ships waiting to berth, that is inefficiency. It gets paid for by somebody somewhere in high costs of importation of exportation,” Kututa said.

In 2021, shippers in Kenya paid over Sh2.5 billion in storage, a slight improvement from 2020 when shippers paid Sh3.6 billion in demurrage.

“The good news is that KPA has told us they don’t need this money,” said Gilbert Langat in a speech read on his behalf by Shippers Council of East Africa’s Agoyo Ogambi.

Langat is the chair of the Mombasa Port and Northern Corridor Community Charter.

“This means we need to plan for a better clearance process,” he said.

Kututa said they advocate for pre-clearance of cargo to ensure the cargos reach their destination as fast as possible.

“That is an index we need to keep an eye on,” said Kututa.

Ogambi said: “In this part of the world, we are still struggling with downtime and delays, while the rest of the world is discussing issues of green logistics.”

Langat said infrastructural development alone cannot bring efficiency.

He noted that expertise and knowledge have to be brought on board with 80 per cent of the global trade being done by sea.

However, he said Africa only contributes 10 per cent in exports.

The SGR, he said, sadly supports mainly imports and not exports.

Langat said in as much as government is the facilitator of trade, the private sector needs to put in place better systems that will ensure improved efficiency.

Kenya Maritime Authority acting director general John Oming’o said with the increasing cost of doing business, which negatively affects commodity prices and subsequently the cost of living.

He said there is a need to come up with strategies that respond to the dynamic nature of international trade.

Oming’o said with the expansion of port infrastructure, improvement of the road network, freedom of choice on the mode of transfer from port and final place of customs clearance, cargo owners have now greater flexibility and control over the quality and cost of services.

“This is a boost to national trade and provides greater opportunities to large, medium and small scale enterprises,” he said in a speech read on his behalf by KMA’s Captain Peter Munga.

The blue economy, he noted, has many opportunities that are yet to be fully utilized and these should be made known to potential investors.

“We need to engage and explore ways of making the best of what we have in our waters,” the KMA DG said.

The stakeholders said weighbridges and roadblocks are some of the non-tariff barriers that the stakeholders have identified as the major stumbling blocks to the efficient delivery of cargo.

They said the roadblocks need to be reduced or removed altogether and the weighbridges need to be only one or two at most.

Langat said the Kenya Revenue Authority should also reduce the number of containers that need to be verified.

Today, Kututa said, competition, even amongst goods, is about supply chains.

“So we are focusing on how we can have the most efficient supply chain,” said Kututa.

He said the private sector should be allowed to drive every process and let the government be more facilitative rather than taking the leading role.

“Because this is where jobs are created. These are the people who know what they need in order to make supply chains work,” said Kututa.

He said this is to avoid lots of mistakes, trial and error because the users of the ports are mainly the ship agents, ship owners, and cargo owners, among others.

“We should not work in silos. We should engage constantly,” said Kututa.

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