26 November 2012

Rwanda: Importers Turn to Dar Port As Kenya Election Draws Closer

Officials at the Kenyan Ports Authority fear that the upcoming general elections could have a negative impact on regional trade.

The Kenyan Ports Authority revealed that they are experiencing a reduction in volume of goods handled through Mombasa port, the main gateway for imports and exports from and to all regional countries.

According to the port's senior public relations officer, Sylvan Mghanga, traders anticipate violence, thus they fear of losing out.

The Kenyan general elections are slated for March 4, 2013.

"We have started noticing reductions in import volumes. Traders are conscious about the elections period and we should expect little imports beginning January next year", he said in an exclusive interview with The New Times.

He observed that last year, the imports were increasing by 20 per cent compared to 4 per cent this year, adding that in January they expect total reduction, meaning that few imports would pass through the Mombasa port.

The drop in imports means that some goods will not be available on the market, which could trigger price hikes.

Petroleum and other related oil products are some of the goods that expected to be scarce in the region.

Mombasa port apparently has the capacity to handle over 600,000 containers (21m tones) per year. On daily basis it offloads 2000 containers of imported and exported products.

However, statistics indicate that though it's the largest port to handle most imports, the exports are still stumpy where 200,000 containers are exported per year meaning that the region depends on imports as this creates big trade imbalance.

Violence in which more than 1,200 people were killed and 600,000 more displaced marred the 2007 elections, thus leading to regional traders incurring losses estimated in billions.

Till now thirteen claimants, are demanding for more than US$47.5 million as losses incurred as a result of the election violence.

Some importers have now opted to use the Tanzanian port of Dar-es-Salaam.

Mombasa port serves regional countries of Uganda, Rwanda Burundi, eastern DRC, south Sudan and some parts of northern Tanzania.

Robert Kalisa Zimulinda, a Rwandan clearing and forwarding agent in Mombasa, said that many agents have shifted to Dar-es-salaam owing to the many bottlenecks at Mombasa.

He said it takes over US$1200 to clear and transport a small car from Mombasa to Kigali compared to US$700 that's spent at the Tanzanian port.

"We were many at this port but because of all these barriers over 80 per cent of Rwanda clearing and forwarding agents have left for Dar. We don't have jobs here we also remain here because of some clients who still have confidence in the port"

He added apart from the trade barriers, the port lacks enough capacity to handle all the imports and exports. At the port, the container terminal is congested with imported containers waiting for the owners to clear them.

According to Kalisa, the ports authority provides only nine days to clear the goods after they have landed, failure of which leads to a fine of $60USD per day.

He further added that Rwandan importers were ignorant about the importation activities where he said that sensitisation is needed on how to operate. He said some traders take containers and fail to bring them back at the port as this hampers that clearing agents.

The KPA offers only 30 days for the clearing agent to have taken back the container the failure of which leads to pay $600USD per day.

However, as a way of solving the inadequate capacity, the Kenyan government had entered into a partnership with Japan to construct a new container terminal at the Mombasa port as this would help in solving some of the challenges hindering regional trade.

The best mechanism to resolve trade inefficiency operations at the port is still unclear as the Ports Authority has already turned down plans to privatize the port though EAC's secretariat had envisaged privatization as the means that would assist the region.

"The current government's stand is that there is no privatisation of the port. The port of Mombasa belongs 100 per cent to the government," Bernard O. Osero, the Corporate and Public Relations Manager, KPA, said last week.

The most imported materials are raw materials, finished goods, food, and crude oil and others while the region exports tea, coffee, sisal and others to Europe Asia and America.

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