SPEECH BY THE MANAGING DIRECTOR DR. ARCH. DANIEL MANDUKU DURING THE LAUNCH OF KPA 2018-2047 MASTERPLAN ON 7TH AUGUST 2019 AT THE WHITESANDS BEACH HOTEL
- Cabinet Secretary Ministry of Transport, Infrastructure, Housing, Urban Development and Public Works, Mr. James Macharia, EGH,
- Kenya Ports Authority Board Chairman, Gen. (Rtd.) Joseph Kibwana, EGH, CBS,
- KPA Board of Directors,
- Senior Government officials present,
- Invited Guests,
- Ladies and Gentlemen,
It gives me great pleasure to welcome you all to this occasion that sets to celebrate our milestone and prepare the groundwork for our future through the launch of the Kenya Ports Authority 2018-2047 Masterplan.
Maritime shipping is the lifeblood of Africa, with over 90% of the continent's imports and exports transported by sea. In its Integrated Maritime Strategy 2050, the African Union terms the shipping industry "a new frontier for the continent's renaissance". The Strategy which aims to foster more wealth creation from Africa's oceans, seas and inland waterways needs us to rethink on the management of these key resources.
A quick search on the shipping and maritime trends around Africa reveals a continent in a haste to improve its economic potential through the development of ports infrastructure for growth realization. From the Port of Durban in South Africa, the Port of Tangier in Morocco, to the Port of Abidjan in Cote D'Ivoire and even closer home the Port of Dar-es-salaam in Tanzania, the script is the same with respective governments investing heavily in the expansion of ports, which have been mapped as a great catalyst for economic growth. Kenya Ports Authority is no exception as it rushes to position her facilities to reap a slice of the African cake in the form of increased cargo volumes through its ports.
Since its inception 41 years ago, KPA has had a vision, which it strives to accomplish. From when cargo was transported in boxes at the Kilindini Port, to the evolution and introduction of twenty foot containers. From the unstructured berths where small vessels would dock, to post panamax vessels with a length of 300m currently docking at the Port of Mombasa.
Indeed, it has been decades of positive transformations that have yielded great results. Numbers have told a story of a port on the move, from a container traffic of 0.380m TEUs in 2003, to 0.894m TEUs in 2013 and 1.303m TEUs in 2018.
Cargo throughput has equally witnessed an upward trajectory, growing from 11.93m dead weight tons in 2003, 22.31m tons in 2013 and 30.92m tons in 2018. The annual compounded growth rate for the last 10 years averaging at 8.6 % for containers and 5.5 % for total throughput. This year we are optimistic of remarkable performance having witnessed positive growth in our half year results.
Ladies and Gentlemen,
Between the period January to June 2019, the Port realized a growth of 1,733,135 tons or 11.2 percent, recording 17,216,268 tons against 15,483,133 tons handled in the corresponding period in 2018.
This growth in port performance has been augmented by the massive investments in port infrastructure and equipment acquisition over a period of time. KPA in collaboration with development partners has implemented several projects including Mombasa Port Development Project, equipment acquisition and modernization, Lamu port construction among others that are still in the implementation stage.
All these investments are strategic and geared towards providing not just competitive services but also timely and efficient services to our customers. This launch is therefore crucial to the realization of our shared goals and ambitions.
The Masterplan sets out the blueprint of our future endeavors and what we are projecting to have accomplished in the coming thirty years.
I know it may sound absurd to some individuals, for us to be making plans for events expected to happen two decades to come, but as the famous adage goes, if you fail to plan, plan to fail.
Brief Information on the Masterplan
The Port developed her first master plan in 2004, which was later reviewed in 2009. However, the ever-evolving maritime industry, coupled with changes in government policy and the need to create synergy in complementing sectors necessitated the need for a review of the Master Plan to ensure KPA aligns with the changes. Some of these changes include:
- The emergence of post-panamax vessels with up to 350m length which have warranted the development of deeper and wider berths
- The transfer of the mandate to run lake ports from Kenya Railways to Kenya Ports Authority
- The development of a second transport corridor linking Kenya to Ethiopia and South Sudan
- The development of the Standard Gauge Railway project
- The need for increased public private partnership model in port development
- The aspiration to develop small ports to tap into the Blue Economy
- Collaboration with County governments in developing lake ports and small ports as enshrined in the constitution.
As we all know, plans are live documents, and have to be gauged on the industry needs and demands. This Master Plan will therefore be reviewed from time to time to ensure that it stays in tandem with the needs of the industry, the port community and other stakeholders.
In summary, this Master Plan 2018-2047 entails the following:
The Port has been experiencing steady growth in cargo throughput and container traffic for the last decade. The Masterplan describes the container traffic demand forecast for the Port of Mombasa growing from 1.3 million TEUs in 2018, 2.9 million TEUs in 2027, 5.5 million TEUs in 2037 and 9.8 million TEUs in 2047. Similarly, total cargo throughput is projected to increase from 30.92 million DWTs in 2018, 61.4 million DWTs in 2027, 111.3 million in DWTs in 2037 and 188.0 million DWTs in 2047.
Likewise, for Lamu, it is predicted demand will steadily increase from an initial volume of about 1.5 million tons annually in 2022 to 14 million tons per annum in 2027, 38 million tons per annum in 2037 and 76 million tons annually in 2047.
The Master Plan identifies the development strategy for the major ports, lake ports, small coastal ports and the Inland Container Depots, where:
The development of Dongo Kundu Special Economic Zone will see an additional berth constructed at the Port of Mombasa to boost trade. Expansion and modernization of existing infrastructure specifically the construction of new berths in the westerly direction.
KPA is also developing a modern oil handling facility by relocating the current Kipevu Oil Terminal to a more suitable location to allow for expansion. This will ensure more than one vessel discharge oil at once thus increasing the capacity of the terminal.
On the other hand, Lamu Port is projected to grow through the construction of new berths for general cargo, liquid bulk and dry bulk. Ultimately, the Port of Lamu will have a capacity of 76 million DWTs by 2047.
The Inland Container Depot in Nairobi was recently revamped and its capacity increased to 450,000 TEUs annually. Following the construction and operationalization of the Standard Gauge Railway, the use of cargo trains has greatly increased traffic to the ICDN, it is recommended that the facility's capacity be expanded to handle up to 1.0 million TEUs annually. Container volumes ferried by the SGR is projected to grow to 0.732 million TEUs in 2022, 0.909 million TEUs in 2027, 1.330 million TEUs in 2037 and 2.201 million TEUs in 2047. Plans are also underway to put up other ICDs proposed to be near major economic and logistics centres and national borders, where facilities are required for customs inspection and to boost trade facilitation. KPA is looking to develop ICD's in Naivasha and Taveta.
To support Government in harnessing Blue Economy, the Authority in partnership with the county governments plans to construct small Ports in Kwale and Kilifi counties. These will primarily be fishing ports to grow trade in the areas and lift the economies of the region.
The flagship small port that KPA is in the process of developing is the Shimoni Port in Kwale County.
The total investment for the above development is expected to be US$ 3.6 Billion, that is, US$2.1 Billion for Lamu and US$ 1.5 Billion for Mombasa. Whereas these are colossal resources, we are confident that the private sector, our development partners and other like-minded stakeholders will partner with us to ensure the realization of this vision.
Concurrently, KPA is rehabilitating the Kisumu Pier to make it a modern port with cargo stacking yards and modern equipment. As we speak, all government agencies involved in cargo handling including Kenya Maritime Authority, Security agencies, Kenya Revenue Authority, among others, are installing their systems ready for port operationalization. Once complete, Kisumu Port will become a regional transit hub in East Africa.
Therefore, the role of the private sector in the development of the port subsector cannot be overemphasized. In this Master Plan, it is envisaged that the Port of Lamu and other ports will principally be operated as landlord ports, while the Port of Mombasa will gradually transform into a landlord port. We therefore encourage the private sector to interrogate this plan and find ways in which we can engage and partner based on the land use plan and zoning detailed in the plan.
We seek collaboration that will not only enhance the port infrastructure, but that which will catapult into delivering efficient and quality services for our customers, while at the same time adhering to the regulatory framework and standards.
In the recent past, there has been an increased talk about harnessing the Blue Economy potential, environmental friendly development that is alive to the climate change initiatives and sustainable port development within the context of the green port policy.
We have adopted a Green Port Policy at the Port of Mombasa and consequently a leading port in the sound stewardship and management of the environment. This comes with a raft of measures, projects and programs, packaged under the Mombasa Resilient Infrastructure Program (MRIP).
In implementing the Master Plan 2018-2047, the Authority will be keen to ensure that the development envisaged is sustainable. Adequate mitigation measures whenever necessary shall be put in place to guard against any inherent risks. All efforts shall be made to preserve our environment and maritime ecosystem. This however calls for teamwork and great efforts from all stakeholders who are at the forefront in ensuring these plans succeed.
Finally, I want to thank the Government for the continued support that has allowed us to achieve this tremendous growth. We are also grateful to our development partners who have collaborated with us in implementing projects at the ports.
It is our hope that we shall maintain our usual cooperation in the years to come to be able to achieve that which we have set out to achieve.
Thank you and God bless you.