Goods Stranded at Mombasa Port Following KPA, SGR Standoff

  • President Uhuru Kenyatta flags off SGR Phase 2A at the Nairobi Terminus on Wednesday, October 16, 2019
    President Uhuru Kenyatta flags off SGR Phase 2A at the Nairobi Terminus on Wednesday, October 16, 2019
    PSCU
  • Reports have emerged showing that Kenya Railways Corporation (KRC) owes Kenya Ports Authority (KPA) billions of shillings and this has jeopardised operations at the port of Mombasa.

    In a statement dated Tuesday, June 15, the Kenya Transporters Association (KTA) revealed that shipping lines have subsequently put on hold the accounts of both Kenya Railways and KPA to force recovery of the debts.

    According to KTA, the government has continued to use KRC and KPA to force a monopoly on transporting goods from Mombasa to Nairobi through the Standard Gauge Railway (SGR).

    An Image of a cargo clearance officer supervising clearance at Mombasa port
    An Image of a cargo clearance officer supervising clearance at Mombasa port
    File

    "Businesses that are not subjected to market forces and depend on a monopolistic model based on protection and subsidies from the government eventually end up in the position that KPA - KRC/shipping lines find themselves in," KTA stated.

    KTA added that although importers pay upfront for any services rendered by KPA, SGR and Shipping lines, the monies are not remitted as required. 

    Further, the association faulted the business operations at SGR noting that the incentives that the government instituted to make the railway lucrative were now proving to be working against them.

    "It is clear that these parties that came together to disenfranchise road transporters are now suffering the negative effects of inefficiencies, unfair discounts and preferential private arrangements given to selected stakeholders to defeat market forces and support SGR," the association opined.

    KTA noted that transporters have offered a last-mile transport to importers' premises and are now stuck with empty containers.

    Further, the transporters' association revealed that containers are not being accepted at the Nairobi's Inland Container Deport (ICD) in |Embakasi because the shipping lines accounts are on hold in KPA until the dues are paid.

    "We urge all parties involved to resolve their issues urgently and put in place sustainable efficient good business practices and policies that ensure that this situation does not arise in future," KTA stated.

    Fil image of the busy Mombasa Port in Mombasa County, Kenya
    Fil image of the busy Mombasa Port in Mombasa County, Kenya
    File

    In 2021, KPA was in the spotlight after reports emerged that cargo destined for Mombasa and its environs was being hauled to Nairobi on the SGR.

    There was a dispute between KPA and importers over whether their shipment should be ferried by SGR or released to Mombasa-based Container Freight Stations (CFSs).