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Shipping & Logistics

KPA purge linked to quest for efficiency

James Macharia
Transport and Infrastructure Cabinet Secretary James Macharia. FILE PHOTO | NMG 

The government has assured users of Mombasa port of efficiency and enhanced services following the recent board and managerial changes made at Kenya Ports Authority (KPA).

Transport and Infrastructure Cabinet Secretary James Macharia said at the International Road and Transport Research conference in Mombasa that the changes were meant to address challenges such as cargo pile-up which have plaqued East Africa’s largest port for long.

Mr Macharia said that the board will meet Thursday to confirm the appointment of Daniel Manduku as the managing director. He was appointed in an acting capacity after the board sent former MD Catherine Mturi-Wairi on compulsory leave two weeks ago.

The board said it had sent Mrs Wairi on leave due to lack of effective leadership and a non-responsive work culture, consistent failure to implement board resolutions and absence of clear performance targets at the organisation.

“We were unable to evacuate a lot of cargo to our clients due to lack of effective leadership, consistent failure to implement board resolutions, absence of explicit performance targets and failure to implement them,” said Michael Maina who chaired the board meeting that suspended Mrs Wairi.

Mr Macharia said the new board hopes to improve port services by speeding up clearance of cargo.

“Apart from the new MD, the board has new members including chairman Joseph Kibwana. As government, we are optimistic that the new team will spur the facility to greater service delivery and both importers and exporters of cargo using the facility are now assured of speedy clearance,” Mr Macharia said.

“The board will meet to agree on terms for a substantive MD. The process must be competitive and that is what the law requires, we anticipate that the board will hasten the process. The good thing is that we now have a well constituted board with a new chairman, new board members, acting CEO, and several other general managers,” he said.

Mr Macharia said that for the short time that Dr Manduku had acted as MD, there was remarkable reduction in cargo backlog at the port.

“Mombasa port is always busy, receiving between 3,000 and 4,000 containers every day. But for the last four weeks the facility faced several challenges including cargo clearance delays that led to a pile up of 30,000 containers. The number has since fallen to 10,000 after Dr Manduku took over office. This is an improvement in as far as port services are concerned,” the CS said.

Mr Macharia further defended the board for appointing Dr Manduku saying that it acted within the law. “Before his appointment to head KPA, Dr Manduku worked at the National Construction Authority as CEO. That board is under my ministry so the claim that he is an outsider does not arise,” he said during the interview.

Dr Manduku reported to work last week after the High Court lifted orders suspending his appointment. He said he was optimistic about improving efficiency at the port and boosting trade.

“I reported to work as directed by the court,” the MD said on phone. Last Friday, Mrs Wairi wrote to Mr Macharia informing him of her decision to resign after 25 years at KPA. Her resignation came against a backdrop of two court cases filed at the High Court and the Employment and Labour Relations Court challenging the board's decision to send her packing.

But even as the minister assured of enhanced cargo clearance, stakeholders have opposed a recent KPA directive over nomination of undocumented cargo to container freight stations (CFS) by KPA.

In a paid up advert two weeks ago, KPA notified all shipping lines that containers destined to Mombasa for local clearance would not be allowed to be nominated by clients or endorsement of bill of lading to any container freight stations (CFS)

“The nomination shall be done by KPA based on vessel rotation, volumes, and individual CFS capacity; you are required to inform your clients in your various ports of loading accordingly,” said KPA in a statement.

But on Tuesday this week, Kenya International Freight and Warehousing Association (Kifwa), Car Importers Association of Kenya (CIAK) and clearing agents said KPA should focus on its mandate of overseeing export and import of cargo and not wade into controlling of the work of other players at the port.

In a press release, Kifwa National Chairman William Ojonyo said notices from KPA were targeting their members and their operations.

“It is unfortunate that KIFWA has not been consulted before release of all the notices even though clearing agents remain members and their operations. The notices have been done in total disregard of the spirit of the port community charter and smooth flow of business. The notices have eroded the gains made in enhancing trade facilitation, especially where the port management is randomly planning for KPA nomination without regard to preferred CFS by importers,” he said.

Mr Ojonyo said the same agency had earlier on given a notice that all un-nominated cargo would be railed, “and they cannot be again saying that it will now decide who to nominate cargo to.”

The chairman said importers had a problem with KPA deciding where their cargo should be taken, arguing that some of the CFSs have challenges that irk their members.

“Some CFSs have issues and we have had a bad history with them including loss of cargo. Some of our members have had their containers lost in some CFSs. That is why initially it was important to allow consignees and clearing agents to nominate, because they had their preferred CFSs,” he said.

He said the directive by KPA means going back to where nominations are done without regard to the importer, "and that is why we are against this idea".

“We want to have it halted until the issues we raise during a stakeholders' meeting have been taken care of,” he said. Mr Ojonyo said that Kifwa did a survey on port activities and that the situation, especially on cargo backlog, had not improved.

“We have not made any progress in as far as cargo clearance at the port is concerned. It is very clear that there is a problem both at the Kenya Revenue Authority (KRA) and KPA. I am writing a letter to KRA on areas where we think we have a problem with them. We expect them to rectify or engage us in a meeting. But now, nothing much has changed,” he said.

Mr Ojonyo said that cargo clearance stands at between 300 and 345 containers out of a daily input of about 600.

CIAK chairman Peter Otieno said KPA’s mandate is load and offload cargo and do not have contract between the shipper and the shipping line.

“KPA also does not have any power on cargo shipped to the port as they are neither exports, importer or notify party.

In the document of title which is Bill of Lading, there is nowhere KPA plays any part, apart from doing off-loading and loading. They have no power over cargo,” said Mr Otieno.

Mr Otieno said international laws on shipping that ports can dictate where the cargo goes.

“That is wrong and unlawful as world over practice states that it is only the shipper who can dictate where the cargo has to go. KPA is overstepping their mandate,” he said.

Mr Otieno said already some importers had already entered into negotiation with CFS to have their cargoes directed nominated to them and that KPA should not become part of such engagements.

“Nomination of cargo is an agreement between CFS and the importer and KPA has no role in such arrangement,” said Mr Otieno, who added that the directive might fire back to bring another problem in cargo clearance at the port.

However, KPA communication officer Haji Masemo said the issue was raised by the stakeholders at the meeting and that consultations are ongoing.

“These are containers that are un-nominated at the port, they are un documented. Instead of changing status to have them sent to the CFS by KPA since they are under the care of KPA, the agency will do the nominations to CFS so that they can receive the goods,” said Mr Masemo.

Mr Masemo said KPA had been doing the nominations since the establishment of CFS.

“Consultations are ongoing and we shall continue to engage the stakeholders to make sure that we arrive at an amicable solution,” he said.

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