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Shipping & Logistics

Marine economy yet to gather steam four years later

Fishermen go about their business in Lake Victoria in Kisumu. FILE PHOTO | NMG
Fishermen go about their business in Lake Victoria in Kisumu. FILE PHOTO | NMG  

If wishes were horses, Kenya’s water-based assets would be generating billions of shillings in revenues for local firms and employing thousands of people by now.

President Uhuru Kenyatta’s government adopted the ‘blue economy’ (economic activities associated with lakes and oceans) as a mainstream concept almost four years ago with the aim of multiplying maritime wealth three-fold.

he President started by creating a shipping and maritime affairs department in his office. Its head, PS Mrs Nancy Karigithu would tell the Business Daily in a tone-setting interview:

“Singapore, United Kingdom and Australia are among the countries that have realised the value of the maritime sector reaped benefits for their economies.”

It was easy to see what she had up her sleeves. Increased involvement of local intermediaries in the international trade — which is at least 90 per cent shipped through the oceans —was to be one of the low-hanging fruits.

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She also thought of demarcating and improving surveillance on Kenya’s ocean waters would significantly reduce the illegal, unreported and unregulated (IUU) fishing through which stock worth Sh10 billion is shipped away every year.

Four years down the line, not much has changed. The blue economy still remains an alien concept even though its contribution to GDP is estimated to have reached Sh178.8 billion or about one-third of the Sh500 billion that the government believes it should generate.

Foreign trawlers still fish on Kenya’s waters and IUU remains a key subject of international forums.

The government has implemented a rule that compels importers to buy marine cargo insurance policy locally but monthly figures indicate it might fall 60 per cent short of the Sh22 billion that it targeted as annual premiums.

In the absence of local merchant ships, traders still pay foreign shipping lines and agents their stock of hard currencies, of up to Sh304.7 billion in 2016 for their services, according to government records.

While the opposition coalition, the National Super Alliance, is largely silent about the concept, the ruling Jubilee coalition says it intends to give the water-based economy another go.

In its re-election manifesto, Jubilee says management of water-based assets remains a key pillar of its growth plan.

“An opportunity exists to retain a portion of these (international trade) earnings and create employment,” says the Jubilee coalition in its manifesto.

“We will implement an integrated maritime strategy and work towards promoting and developing the Blue Economy.”

The document acknowledges that the Blue Economy remains under developed “despite the massive opportunity to grow and diversify the economy and generate jobs.”

Jubilee says it will continue to enforce the Insurance Act which makes it unlawful for any person to place insurance offshore without prior written approval of the Commissioner of Insurance.

The coalition also commits to revive the Kenya National Shipping Line and get locals to participate in shipping, shipbuilding and repair, marine engineering, marine insurance, logistical support and finance.

“Together, these segments have the potential to create at least 50,000 quality jobs,” it states in the manifesto.

The government’s blue economy plan covers resources of lakes and oceans.  Kenya’s territorial ocean waters cover 230,000 square kilometre and a distance of 200 nautical miles offshore.

In the next five years, the jubilee has pledged to transform Bandari College into a maritime centre of excellence to boost its role in supplying the pool of professionals.

It hopes to create 12,000 jobs and generate Sh20 billion in revenues by building fishing ports in Shimoni, Mombasa, Kilifi and Lamu.

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