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Shipping & Logistics

Freight stations fear for survival over order to clear cargo at port

Gilbert Langat
Kenya Shippers Council CEO Gilbert Langat. FILE PHOTO | NMG 

Players in the shipping industry are up in arms over a decision by the Kenya Ports Authority (KPA) to have all cargo cleared at the port, leaving container freight stations with almost nothing to do.

Led by the Kenya International Freight and Warehousing Association (Kifwa), the business owners said the move will destroy their businesses.

Kifwa national chairman Roy Mwanthi said the decision would see more than 20 CFSs shut down.

In an email seen by the Shipping & Logistics, KPA has directed its management to stop all cargo nominations to the CFSs.

“Team, please stop any further CSF nominations with immediate effect. Those already documented will be allowed to get out tonight by 0700hrs. Bring this to the attention of all staff for compliance,” read the email sent last week.

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The email, dated August 14, 2019, was sent by the port’s head of container operations, Edward Opiyo to — among other top officials — KPA managing director Daniel Manduku.

Mr Mwanthi said clearing all cargo at the port would mean more delays.

“We are opposed to this decision. This is a clear way of killing the CFSs. All those working at the CFSs would be rendered jobless,” he said.

“It will also create pressure among importers as people are only given four days to clear cargo at the port as opposed to the CFSs where one can be given between 21 and 30 days.”

The port, he noted, should remain just a transit point and not a storage facility.

“We call on the government to revoke this directive. People in the shipping industry need clear guidelines and not confusion,” he added.

Already, Mr Mwanthi said some employees have lost their jobs following a series of directives that have been “gradually killing the economy of the Coast region”.

A CFS owner in Mombasa who spoke on condition of anonymity said a majority of the stations are bound to close their operations, taking down hundreds of jobs.

“We have been faced with frustrations since last year when the port declared that it is the one who will nominate cargo to the CFSs. Since then a number of the stations have stopped operating,” said the official.

In June, last year, KPA said containers destined to Mombasa for local clearance would not be allowed to be nominated by clients to any CFS.

It said the nomination would be done by KPA based on vessel rotation, volumes, and individual CFS capacity.

The recent directive comes in the wake of another where KPA and the Kenya Revenue Authority (KRA) announced that all imported cargo from Mombasa to Nairobi should be transferred through the Standard Gauge Railway (SGR).

The decision caused an uproar among Coast leaders and businessmen who protested that the decision would render hundreds of truck drivers jobless.

A majority of the truck drivers operate at the CFSs which are now staring a slow death. The protests by Coast leaders forced the government to suspend the decision indefinitely.

The Council of Imams and Preachers of Kenya (CIPK) called on President Uhuru Kenyatta to intervene and have the move rescinded.

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