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Shipping & Logistics

37 ships cancelled as fate of 104 others remain uncertain

Ms Marco Polo
One of the 1,000 tourists who arrived in the country on board Ms Marco Polo getting detected for Coronavirus on February, 13. FILE PHOTO | NMG 

Business at the Port of Mombasa has been significantly affected following the cancellation of 37 ships scheduled to dock this month while the fate of 104 others remain uncertain following an outbreak of coronavirus.

The Kenya Ports Authority (KPA) managing director Dr Daniel Manduku said apart from cancellation of the ships, a number of vessels which docked at the port in February reported blank arrivals affecting cargo throughput at the facility.

Speaking to Shipping & Logistics, Dr Manduku said business losses have been acutely felt in the supply chain, with the Standard Gauge Railway (SGR) which haul the cargo directly from the Port of Mombasa to Inland Container Depot (ICD, the most affected.

"In February, we had a number of ships but most of them recorded blank arrivals where they docked with fewer containers than expected. This month we have been hit hard by the coronavirus," said the MD.

Dr Manduku describe the situation as the worst ever in the KPA's history.

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"Kenya receives more than 40 percent of its imports from China and considering shipping is a global trade, it has affected a number of transshipment vessels and the results are dire for business," he said.

Since the disease was first detected two months ago, essential supplies for East African businesses, especially Small and Medium Enterprises (SMEs), have been cut off, leaving them fighting to stay afloat.

Kenya Importers and Small Trader's Association chief executive officer Samuel Karanja said they have lost almost Sh3 billion since the outbreak as traders’ goods are stuck in China, with factories not working.

According to weekly report by the KPA from February 27 to March 4 this year, the number of SGR freight registered declined from an average of 60 in November and December 2019 before the outbreak of Covid 19, to 40 trains last week.

The decline in cargo is a big blow to Kenya as it expected to collect more revenue from SGR services and pay Sh10 billion monthly to China's Exim Bank. The five-year grace period that Beijing had extended to Nairobi to repay the loan used to build the SGR line ended last year.

Kenya in May 2014 entered into a deal to borrow Sh320 billion from China's Exim Bank, comprising Sh160 billion commercial loan and Sh160 billion concessional to build the 385km modern railway between Mombasa and Nairobi.

The repayment of the loan is now in jeopardy thanks to the coronavirus pandemic. Dr Manduku on Wednesday established a special committee to spearhead preparedness against the disease at the Port of Mombasa.

The committee is expected to be instrumental in supporting the National Emergency Response Committee especially in its efforts to enhance surveillance at all ports and points of entry.

The committee’s task is to develop and communicate precautionary measures on the coronavirus outbreak, conduct staff awareness on the virus and periodically review corporate preparedness against the disease.

Meanwhile the KPA has announced temporary cancellation of all official international trips in an effort to mitigate the spread of the Coronavirus.

"I have with immediate effect suspended all official international trips until further advised otherwise," said Dr. Manduku in a circular to all staff.

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