Kenya's Lamu Port lagging in EA transhipments, KPA data shows

Tuesday March 28 2023
Lappset project Lamu Port

MV Banyas 1 Lome Vessel docks at Lamu Port Berth Number 1 on October 15, 2022 waiting to export livestock to Oman. Lamu Port is yet to tap business from Horn of Africa importers and relieve Mombasa of congestion in transshipment two years after its launch. PHOTO | FILE ODIT | NMG


When the Lamu Port was inaugurated on May 20, 2021, the idea was to tap business from Horn of Africa importers and relieve Mombasa of congestion in transshipment. Nearly two years later, that hasn’t happened.

Official data from the Kenya Ports Authority (KPA) shows that Lamu is handling less than 2,000 twenty feet equivalent units (TEUS), with the Salalah port in Oman the main preferred transshipment port.

Lamu had come in with a suitable depth enabling it to accommodate big container ships, with smaller ships picking cargo from Lamu for onwards transshipment to other ports of the world, including feeding the Mombasa port.

Salalah is the biggest port in the Arabian Peninsula and most ships in Eastern Africa use it for transhipments.

The new KPA managing director William Kipkemboi Ruto last week said that his priority is to challenge that domination, targeting cargo headed to Southern Ethiopia and South Sudan as immediate business. The problem though is that Lamu’s connecting roads and planned railways are underdeveloped, making importers reluctant to use it.


Kenya Ports Authority (KPA) Managing Director William Kipkemboi Ruto reports for duty in Mombasa on March 13, 2023.


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Lapsset project

Lamu was one of the flagship infrastructure projects under Kenya's Vision 2030 and was promoted as part of a proposed transport corridor linking with Garissa, Isiolo, Maralal, Lodwar, Lokichogio and Moyale to form part of the Lamu Port South Sudan Ethiopia Transport (Lapsset) corridor.

A logistics advisory firm GBS Africa notes in its latest January report that foreign direct investment is driving expansion and rehabilitation of existing seaports as well as the rolling out of entirely new facilities. The report warns that ports that shun partnerships with experienced foreign investors will lose out as competition for market share intensifies.

The document said Lamu in Kenya and Bagamoyo in Tanzania have the potential to challenge Mombasa’s dominance in coming years due to their capacities to handle larger vessels.

However, the document said Salalah Port has continued to serve key African ports while Lamu struggles with lack of right infrastructure and insecurity.

"Lamu Port has potential to accommodate big container ship where small ships can call at the port for onward transshipment to other ports of the East Africa. That would be of beneficial to traders as containers move much faster thus many vessels might avoid the time to get to Salalah Port in Oman which will be of benefit to the new Kenyan second commercial port,” reads the report.

Lamu, built from 2014 by China Communications Construction Company (CCCC), currently has four berths but will have 32 once fully established. That means it will replace Mombasa as Kenya’s largest port facility.


Workers at work at the new Lamu Port-South Sudan Ethiopia Transport Corridor site in Kililana in Lamu West. PHOTO | NMG

However, the Lapsset project has stalled due to regional insecurity concerns on the border with Somalia, political instability in Kenya and a lack of investment.

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Competition for cargo shipments

The GBS report also pointed out that Bagamoyo Port in Tanzania once completed, will be critical for transhipment due to its depth and size.

It would have a capacity to handle 20 million containers by 2045, 25 times the amount of cargo that the Dar es Salaam port handles today.

“For the continent to be fully integrated and for the vision of the African Continental Free Trade Area to be fully achieved, we must invest in Africa's logistics sector. This will facilitate ease of movement of goods and services. It is therefore important to have predictable policies to attract investments in this sector,'' GBS Africa Managing Partner Agnes Gitau said.

Shippers Council of Eastern Africa (SCEA) Chief Executive Officer Gilbert Lagat in an earlier interview said competition is working to their advantage as governments improve services to maintain and attract clients.

Lagat noted that most ports have invested in different modes of transport but said there is need to embrace the multimodal transport treaty to reduce congestion at the ports.

"To ensure cargo is delivered on time, we need to incorporate both road and rail in our transport system and where possible lakes. We cannot expect to decongest our ports to make them competitive if we depend on one mode to evacuate cargo from the port that is why our East African port are operating at dismal compared to others in the region but with competition, we are seeing government investing more on such infrastructure," Lagat said.

As Somaliland and Tanzania are angling to give Mombasa a run for its money, Kenya is also not lagging behind as it is investing in modernizing the Mombasa Port, building the Dongo Kundu Special Economic Zone and opening up different corridors to ensure cargo is evacuated without delay.