Government sets in motion port takeover bid

A Caterpillar in a dredging exercise at the port of Mombasa on Friday, 22nd March,2019 in Mombasa County. [Maarufu Mohamed,Standard]

A parliamentary committee has protested at proposed legislation that allows the Government to push for the transfer of cargo operations, at the country’s second container terminal, from the Kenya Ports Authority to the Kenya National Shipping Line (KNSL).

The changes to the Merchant Shipping Act will allow the Cabinet Secretary for Transport to circumvent a provision that bars a shipping line from running port operations.

The proposed changes are contained in the Statute Law (Miscellaneous Amendment) Bill, 2019 tabled in the National Assembly last week.

National Assembly Public Investment Committee chairman Abdulswamad Nassir has said that pushing the deal through will not augur well for operations at the port.

He warned that the main container terminal may collapse due to competition, and asked the Government to review the proposal.

“Should the deal happen, it will effectively kill operations at the main terminal. The second terminal operator is likely to lower tariffs for ships, thereby denying business to the main terminal,” said the MP.

Italian company, Mediterranean Shipping Company (MSC) owns 20 per cent of KNSL, and the proposed takeover would effectively give it sway in the terminal’s operations.

The Government has already signed a memorandum of understanding with the foreign shipping line, with KNSL expected to handle Sh500 million of cargo annually. The KNSL management is scheduled to appear before the PIC today morning.