Mombasa port in a privatisation storm

According to the group chairman, and Bahari MP Ben Gunda, the Cabinet endorsed privatisation of the port last December but there had not been any consultations with the region’s politicians and other stakeholders.

Mr Mwakwere said the port’s privatisation was intended to bring about efficiency.

Mombasa port serves East Africa Community countries besides the Democratic Republic of Congo and Southern Sudan.

“We have privatised some functions such as grain and fuel handling in the past and we will continue doing so. We are also aware that some jobs might be lost but there will be employment of the more skilled labour,” he said.

Currently, two of the berths are dedicated to A.P. Moller Maersk group which has also expressed interest of investing in them by purchasing cargo handling equipment.

Maersk chief executive officer Nils Andersen who is based in Copenhagen, Denmark, visited Mombasa port last year with a business team to explore the expansion of the company’s operations at the Kilindini port.

Mr Andersen promised the Kenya Ports Authority that Maersk would bring in cargo handling equipment.

However, Mr Andersen was opposed to a provision in the New Merchant Shipping Act enacted in May this year, which bars shipping lines from investing in other transport logistics.

He said that the company had planned to carry out an investment worth Ksh6.75 billion ($90 million) to upgrade facilities at the port particularly related to container handling.

This clause will exclude our group and a number of other large international companies from bidding or investing in Kenya within a broad definition of ship logistics and related services,” he said in a complaint letter, adding that the provision would undermine the existence of a number of investments that the group and other companies have already made.

KPA dedicated berths 13 and 14 to Maersk Shipping Line in 2007, and they in return were to invest in the cargo handling equipment.

Out of the 22 shipping lines calling at Mombasa port, 13 are for containerised cargo.

Maersk commands about of 32 per cent of the total containerised traffic handled at the port.

Other companies with significant volumes are Mediterranean Shipping Company and Pacific International Lines at 19.4 and 12.8 per cent respectively.

Since there are five container berths at the port, the other shipping lines have to share the remaining three berths, which according to our sources leads to delays since they cannot use the dedicated berths if there is a Maersk ship waiting.