This article was also published in the Star Freight is key in post COVID–19 economic recovery and in the Business Daily How cargo will play key role in economic recovery after corona
Kenya as a country
is currently going through a bruising cycle. From the sporadic inflation
movement in 2019, to the current Covid-19 pandemic that is yet to fully
showcase its impact on not only Kenya’s economy but the continent at large.
Already,
unemployment is on the rise, the economy is taking a hard beating and we do not
know for how long.
The government is
working on stimulus checks to help jump start the economy during our recovery
journey. Indeed, the ability of stimulus programs to boast the economy quickly
by getting cash into mwananchi’s hand
is welcomed. However, this has to be complemented with many other initiatives.
Job creation and
optimization of existing infrastructure will be key in the next phase of
recovery as we seek to create jobs, raise real wages, and bolster the various
sectors that have been hard hit including hospitality, aviation and
manufacturing. To the greatest extent possible, these investments should be
targeted to the workers, families, and communities and lowest end of the
economic pyramid.
As the supply chains
around the world are disrupted, business leaders must prepare for the effects
on production, transport and logistics, and customer demand.
For a start, the
country’s investment in the sea, air and rail networks provides an ideal
platform to rebuild our economy and safeguard our position as the regional
economic hub. The Port of Mombasa in conjunction with the now fully operational
Standard Gauge Railway cargo transport network should lead in generating
revenue for our country by ensuring that we efficiently deliver all the delayed
cargo to the hinterland- not just in Kenya but the region at large.
For Kenya Ports
Authority, this is the time to optimize the expanded yards and berths to handle
more cargo, ride on the revamped ICT system and modernized cargo handling
equipment to literally dominate the EAC market.
The Inland container depots (ICD) should be a beehive of activities,
that will employ and re-engage the youth labour resources in clearing and
processing the cargo to regional markets.
On the other hand,
rail transporters like Africa Star Railway Operation Company should be at the
forefront in offering significant cost efficiency for cargo haulage into the
ports to enable the truckers and other last mile players to deliver the goods
to the end users at an affordable cost. As a local feeder, an affordable road
transport will definitely impact the cost of consumer goods.
Even at its lowest,
once back in operation, our regional flier Kenya Airways, has the ability and
capacity to airlift cargo shipments that will be vital today in the
re-connectivity and regional economies.
To ensure these
measures deliver all round economic value to the different economic segments,
all the industry beneficiaries of the tax waivers and exemptions should be
required to retain all their workforce and ensure that they are optimizing the
youthful resources in linking up the regional market partners.
Even as we grapple on
where to channel our resources in the recovery stage, we have to be cognizant
that infrastructure optimization has the effects of contributing to this
‘economic resuscitation’ and is expected to contribute to future economic
growth.
To set priorities and
better evaluate potential outcomes, the government could set a mechanism for
calculating projects’ economic and social impacts, and a system for measuring
and reporting performance. For now, a transparent pipeline of well-planned
projects, with appropriate risk-adjusted returns, could help to attract public
and private investment into the infrastructure ecosystem.
The uncertainty and
turbulence in the economy locally and across the world, the reality, of course, is that many players in
the transport infrastructure sector will have some level of debt going into this.
Some layoffs and drastic cost measures will be inevitable, however, operational improvement might just be the pivot
point in ensuring that the costs of transport is fairly shared across the
different players and not hipped onto the consumer of the transported goods.
