German shipping company starts operation in Kenya

Assistant Director Ministry of Industry, Trade and Cooperatives Michael Mandu receives a gift from Hapag-Lloyd, Managing Director for Africa, Middle East and Indian subcontinent DheeraJ Bhatia at a Nairobi hotel during the launch.

Hapag-Lloyd, the world’s fifth largest container shipping company, has made its way into the Kenyan shipping industry.

The German-owned company is eyeing more business in the East African hinterland, where landlocked markets of Uganda, Rwanda, Ethiopia and DR Congo mostly carry their import and export business through the port of Mombasa.

The firm’s Managing Director for Africa and the Middle East Dheeraj Bhatia said Hapag-Lloyd aims to ship Kenyan fresh exports of horticulture and tea. The company specialises in refrigerated containers that transport such kind of fresh products.

The Hamburg-based company will make weekly trips from the port of Mombasa to Jeddah in Saudi Arabia before coming back through the port of Dar Es Salaam and again to Mombasa.

According to Mr Bhatia, Hapag-Lloyd’s shipping activities in Kenya will be managed by the Kenyan firm Diamond Shipping services.

Besides making entry into Kenya, the firm operates in 19 other African ports especially in countries on the Atlantic coast such as Ghana, Ivory Coast, Nigeria and Angola.

Blue economy

Hapag-Lloyd also has a major presence in South African ports. “We looked at Kenya and saw it as a major point of entry if we had to access East Africa and its hinterland,” said Bhatia.

According to the Principal Secretary for Trade Chris Kiptoo, who was represented in the launch by Michael Mandu, an official at the Trade ministry, reforms in the shipping industry and the general blue economy have been the main attraction of global shipping companies such as Hapag-Lloyd.

According to data from the Ministry of Trade presented by Mr Mandu, the port of Mombasa has undergone several reforms in line with powering the Kenyan blue economy.

Seven years ago, Mandu said Mombasa port could only handle 450,000 Twenty-foot equivalent unit (TEUs), that is the capacity of containers a port can handle. But by December 2017, the port has the capability to handle 1.2 million TEUs.

Again currently, the port has the capability to handle 27 million tonnes of cargo annually. “Last time there was port congestion in Mombasa was in 2011,” said Mandu. According to Bhatia, Hapag-Lloyd has a capacity to handle 1.6 million TEUs annually.