Firms eyes stake in Mombasa port

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Posted  Wednesday, October 14   2009 at  00:00

International firms have shown interest in the management of Mombasa port even as it emerges that a recently enacted law denies them a stake in the venture.


The government has already started the process of privatising the port.

A study to determine which sections of the facility should be handed over to private hands is in the offing.

The move is expected to increase efficiency at the port, which serves five countries in the region.

Although the firms interested in bidding are expected to have huge capital outlays as port management is a capital intensive affair, the Merchant shipping Act (MSA) bars shipping lines from involvement in any other business in the country’s transport and logistics supply chain, a provision which could lock them out.

“We still don’t understand why the section was inserted at the last minute. One could read mischief in the sense that someone wanted to lock out shipping lines from competition in the port privatisation tendering process,” said a manager of a shipping line who did not want to be named.

The Privatisation Commission of Kenya has already started the process of identifying a consultant who will advise the government on which part of the port should be privatised.

“The firm would advise us on which areas should be privatised because, as you should realise, the government has privatised some of its parastatals yet we don’t get the desired efficiency,” said Transport minister Chirau Mwakwere.

Take over

DP World has already indicated that it would like to take over the management of the Mombasa container terminal if it goes up for privatisation.

Mr Anil Singh of DP World reportedly said that the firm was awaiting the completion of a study into the future of the port, by Kenya Ports Authority (KPA), which would propose the extent of private sector concessions on offer.

“We would want to be involved sooner rather than later. We have been waiting for an indication,” said Mr Singh.

The debate over whether to transfer control of Mombasa port to a private operator has raged for at least five years.

But the government doesn’t seem to have reach an agreement on the issue.

However, it remains to be seen whether this will translate into the introduction of the port/landlord model of management.

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