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Poor, congested roads erect more hurdles on cargo routes from ports

Tuesday May 03 2022
Cargo ship, Kenya.

Kenya’s second commercial port in Lamu was meant to boost operations but 11 months after its launch, the facility has only been able to handle 11 vessels. PHOTO | FILE | NMG

By ANTHONY KITIMO
By BOB KARASHANI
By PARTICK ILUNGA

Ports in East Africa continue to struggle to be efficient with traders saying they are frustrated by bottlenecks that seem to promote inaccessibility for a region that is a net importer.

At a meeting on logistics for regional trade in Mombasa, examples were rife.

Kenya’s second commercial port in Lamu was meant to boost operations but 11 months after launch, the facility has only been able to handle 11 vessels, with throughput of 1,821 twenty-foot equivalent units (TEUs), according to Kenya Port Authority’s (KPA) data.

KPA officials attribute this to unfinished roads and for the port of Mombasa, they cite a crowded Northern Corridor.

At the 26th Intermodal Africa Exhibition and Conference in Mombasa this past week, KPA acting managing director John Mwangemi said they expect the port in Lamu to pick up after an improvement of infrastructure.

“The first phase of Lamu port is complete and we hope to partner with the private sector to make the port more viable,” he said.

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The port’s second and third berths were completed in December 2021.

“With its natural berths, we anticipate more shipping lines to make calls in Lamu as we continue with different marketing strategies for the facility,” said Mr Mwangemi.

But stakeholders say the government needs to involve users of the facilities in determining viability.

Kenya Ship Agents Association Chairman Silvester Kututa said the Lamu port will work only if users are consulted.

“For the project to take off as it was envisioned, the government should open the entire corridor and involve the private sector,” he said.

“The incentives offered to shipping lines are not yet attractive due to inadequate infrastructure to support seamless flow of cargo.”

The challenges

The Mombasa port in 2021 handled 1.3 million TEUs, aiding business for Uganda, Rwanda, the Democratic Republic of Congo and South Sudan.

But the congested Northern Corridor, non-tariff barriers like irregular roadblocks and the port’s own inefficient operations stood in the way of its quest to be a hub for the region.

“Demurrage contribute to increasing cost of doing business and most traders would only import through a facility with seamless movement of physical cargo and paper trail; that is why we have been pushing pre-clearance of cargo at Mombasa port, which is now working,” said Mr Kututa.

Participants at the conference agreed that the cost of importing and exporting goods in Africa has been high due to poor infrastructure.

“This is why countries are grouping into regional economic blocs to plan and execute infrastructural developments jointly,” said Kenya’s National Treasury Cabinet Secretary Ukur Yatani.

Pooled infrastructure may boost movement of goods but the ports still have a big role to play.

In 2014, the African Union adopted the 2050 Africa’s Integrated Maritime Strategy and Plan of Action to address maritime challenges. Implementing the strategy has been difficult, however.

In Tanzania, the ports authority in February entered into a $500 million deal with Dubai-based logistics firm DP World to improve operations at the country's main ports.

Tanzania Ports Authority (TPA) Director-General Eric Hamissi says some of the funds have been invested in a new online information system that will be accessible to government agencies involved in processing cargo through the ports of Dar es Salaam, Tanga and Mtwara.

“This will allow for all port activities to be monitored and overseen concurrently, thereby reducing delays for our clients," Mr Hamissi told a parliamentary team on an inspection visit to the port of Dar es Salaam this past week.

He said TPA had also invested in modern cargo handling equipment that was already paying dividends in "tremendous improvement" in overall cargo handling capacity at all three ports.

TPA was in the 2020/2021 Auditor General report named among government firms operating on huge debts, at Tsh562.8 billion ($243.63 million).

But Mr Hamissi said the authority was on track to meet its 2021/2022 target of Tsh1 trillion ($432.9 million) through handling at least 18 million tonnes of international cargo.

Up to 90 percent of Tanzania’s international cargo hinges on the ports of Dar es Salaam and Tanga, with Uganda, Rwanda, Burundi and eastern DR Congo being the target destinations. The port of Mtwara handles cargo to and from Malawi, Zambia and Zimbabwe.

A total of $58.3 million was allocated in the 2021/22 government budget to implement marine transport projects in lakes Victoria and Tanganyika aimed at raising the volume of cargo and passenger movements with neighbouring countries.

These improvements could be crucial for EAC’s new entrant DR Congo, which is still trying to develop its first deep water port in Banana in the west of the country. DRC’s current port can only accommodate small ships, meaning the country relies on neighbours to import critical goods.

Rwanda ships the most cargo through the Dar port, at about one million tonnes.

In January, President Félix Tshisekedi laid the foundation stone for the construction of the port in a $1.3 million deal with DP World.

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