Kenyan ports losing shine amid competition

The newly acquired ship-to-shore gantry cranes being offloaded at the Port of Lamu.[Kelvin Karani, Standard] The Port of Mombasa is approaching its capacity limits while the Port of Lamu remains underutilised due to poor hinterland connectivity, a report by an employers' lobby group states. Lack of further investments in the two ports, especially where infrastructure is concerned, is making them lose out to regional and continental peers, which are fierce competitors. The Federation of Kenya Employers (FKE) now wants the government to invest in the development of the two ports' infrastructure for sustainable operations and create employment. "Without urgent investment to support infrastructure, such as warehousing and logistics hubs, the ports' competitiveness is at risk," said FKE CEO Jacqueline Mugo. According to the employers lobby, the maritime and logistics sectors faces a shortage of skilled professionals such as marine engineers and pilots and poor succession planning, exacerbated by a freeze on public recruitment and low morale among workers, worsened by an increasing tax burden with no wage growth. Speaking during the FKE Coast regional annual general meeting at a Mombasa hotel, Ms Mugo decried logistical bottlenecks at the port of Mombasa, particularly in the clearing of goods on weekends. The forum was also addressed by FKE Coast regional president Dr David Kisa and Kenya Ships Agents Association (KSAA) chairman and WEC Lines regional managing director Roger Dainty. However, the federation commended the government on the development of the Dongo Kundu (Southern Bypass) bridge, saying it has improved connectivity and logistics within the Coast region. "Similarly, the ongoing efforts to upgrade the Malindi-Mombasa road are welcome, and we emphasis the need to fast-track the construction of the Mombasa-Nairobi Road to ease persistent congestion and enhance the efficiency of the trade and transport corridors," Mugo averred. FKE urged the government to engage Sudanese authorities to restore market access for tea from the Mombasa tea auction. Ms Mugo noted that since the ban on Kenyan tea on March 11 this year, there have been losses of about Sh2.4 billion. "We are deeply concerned about the ban by the government of Sudan on Kenyan tea imports since March 11, 2025. This unilateral action has caused losses estimated at Sh2.4 billion, with tea stuck at Port Sudan on vessels en route, or in warehouses in Mombasa," she noted. Mugo also took issue with the Sh7,000 levy per truck imposed by Mombasa County, saying it has burdened the tea value chain. "This fee acts as a non-tariff barrier in direct violation of the East African Community (EAC) trade protocols," she noted. "We also raise concern over the transit bond requirements imposed on teas from neighbouring countries sold via the Mombasa tea auction. These conditions create unfair trade barriers and risk undermining Mombasa's competitiveness as a regional trade hub." Kisa noted that tea farmers, exporters and transporters raised concerns over the imposition of levies. On infrastructure limitations, Dr Kisa noted cargo growth at Mombasa Port has put pressure on the facility, hinterland roads, rail and auxiliary facilities. Cargo throughput at Mombasa Port grew from 36 million metric tonnes in 2023 to 41 million metric tonnes last year. Containerised cargo also grew from 1.62 million twenty-foot equivalent units (TEUs) to 2.005 million TEUs last year. "This growth exerted pressure on the handling capacity of the port of Mombasa, designed for 2.1 million TEUs. Additional capacity in the port of Lamu, 1.2 million, could not be utilised majorly due to underdevelopment of hinterland infrastructure," he stated. FKE observed that transporters and warehouse operators continue to incur avoidable costs due to delays in disarming cargo container seals by Kenya Revenue Authority (KRA) officers, especially on weekends and public holidays. "We call for immediate deployment of round-the-clock customs support to ensure continuity of cargo movement and reduce business losses," said Mugo. In the areas of agriculture, manufacturing and trade exports, FKE noted that it was imperative for the government to pursue and strengthen preferential trade agreements with other countries. FKE officials said this was particularly urgent considering the tariffs recently imposed by the US government and growing restrictions from other trading partners. "Strategic international trade engagement is essential to safeguard market access, enhance competitiveness, and protect the livelihoods tied to export-driven industries in the region," she noted.

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