Tuesday, December 1, 2020

Joint efforts needed to enhance efficiency in regional cargo business

This article was also published in the  The Standard

Seaports play a key role in in the economic growth of a nation and neighbouring land locked countries. With the majority of global trade facilitated by sea, developing strong, well-functioning transport infrastructure that connects with the hinterland is a key element of growth for emerging regional markets.

Given the importance of the Port of Mombasa for international trade for Kenya and countries in East and Central Africa, efficiency and unified operations, cannot be taken for granted.

Development and management of ports is a major objective of economic development in many countries. As ownership and operations of seaports have traditionally been in the public sector, restructuring has often been a slow and frustrating process.

However, for Kenya, the new Kenya Transport and Logistics Network (KTLN) is meant to enhance efficiency and coordination by fortifying public-private sector dialogue and leveraging on the efficiencies and synergies of relevant state agencies.

It is hoped that through KTLN, Kenya will achieve its strategic agenda of becoming a regional logistics hub. Additionally, the Lamu Port-South Sudan-Ethiopia-Transport corridor (LAPPSET) is expected to give Kenya an edge over other players in the region.

Without a doubt, efficient transport and trade facilitation require highly specialized managerial and operational skills as well as use of modern technologies.

In recent times, the Port of Mombasa has reported improved efficiency it attributed to construction of the second Container Terminal, improved cargo handling services and faster transfer of cargo via the standard gauge railway. In 2019 alone, the port handled 1.425 million Twenty-Foot Equivalent Units (teus) representing a 7.3% growth over the previous year.

The Port of Mombasa is projected to handle above 2.5 million teus by 2022 after the completion of the second Container Terminal, which is expected to increase the holding capacity by more than 950,000 teus.

Actually, rail freight demand between Naivasha and the Nairobi Inland Container Depots (ICD), and the Port of Mombasa has significantly increased, with the operator hauling 264,696 containers between January and August this year.

Despite the growth, partnering with business operators remains critical, to ensure efficiency and sustainability of transport and trade not only in Kenya but the larger East and Central Africa region.

In the context of the COVID-19 pandemic, lower trade volumes and falling freight rates, governments have to increasingly seek partnerships with private sector players for strategic engagement in operating and maintaining port infrastructure and services.

However, all is not lost, the current construction, modernization, and upgrading of our dry ports with associated rail and road networks will definitely facilitate the trucking of cargo between Mombasa to designated intermodal yards.

The movement of cargo from the designated intermodal destinations is an ideal platform for private sector players to ensure the efficiency and sustainability of transport and trade in order to leverage private sector capital with the aim of redefining how goods flow across the continent.

As we ponder over our COVID-19 recovery, and assume a new normal, this is an ideal time for all stakeholders in the transport and logistics industry to work together to bring about the growth we have always desired as a regional business hub.

The writer is a Communication Consultant