Uganda acquires container freight station at Mombasa

Cargo at Mombasa port. Uganda is the largest destination of transit cargo accounting for nearly 80 per centof cargo that goes through Mombasa port. FILE PHOTO  

By Dorothy Nakaweesi
 

 

Delays in clearing goods are bound to reduce as Uganda finally acquires her container freight station at Mombasa Port.

The facility which has been lying idle for the last four years, is owned by Uganda Property Holdings Ltd, a Uganda government company.


Unifreight Cargo handling Limited- the company which won the bid and compliance with Kenya Ports Authority and Kenya Revenue Authority (KRA) CFS requirements received the keys on Monday at Mombasa Port to manage the facility.

Move lauded
This development has been lauded by the private sector saying it will help them reduce the costs they have been incurring while waiting for the goods to be cleared at the port.

Initially, clearing goods at Mombasa has been taking more than two weeks, leading to the accumulation of demurrage charges.

Commenting about the CFS Private Sector Foundation Uganda’s executive director, Mr Gideon Badagawa, said: “The CFS will go a long away in reducing the congestion of clearing Ugandan bound goods.”

Initially, there was controversy in letting the facility start its respective operation. The Kenyan Authorities had refused to grant something which the Ugandan businessmen saw as a non-tariff barrier.


The Kenyan authorities alleged that Uganda had not met certain conditions. Due to this, they refused to grant the license earlier. Kenya wanted Uganda to pay $1,500 to KRA and a Ksh100 million (Shs3 billion) cash bond to a reputable Kenyan insurance company as cover for 1,000 cars.

Earlier this year at the East African Community (EAC) CEO’s meeting in Kampala, Ugandan business people asked EAC Secretary-General Richard Sezibera to intervene, saying that Kenyan institutions were using their licensing powers as Non-Tarrif Barriers to block the operations of non-Kenyan businesses.

Dr Sezibera said he would look into the claims that KRA had refused to grant the licence to Unifreight Cargo Handling Ltd (UCHL) to operate Uganda’s Mombasa port facility, built in 2009.

UPHL handed over the facility at the Changamwe round-about and was attended by Ugandan government officials including seven members of Uganda Parliament, Uganda Revenue Authority (URA), Uganda Cargo Handling Limited (UCHL) and Uganda Property Holding Limited (UPHL), Kenya Government, Kenya Ports Authority (KPA), Kenya Revenue Authority (KRA) and the county government officials.

Ms Jennifer Mwejukye the managing director of Unifreight, welcomed the venture saying it will allow them to compete. However, she said this contract allows her company to handle only transit cars.

“This contract is restrictive in a way that our company will not be allowed to handle clearing of cars destined for our clients in Kenya but only in Uganda,” Ms Mwijukye said.

THE NUMBERS

Shs362.5 billion: Average amount of money-an equivalent of $145,000- that companies spend collectively per month on employees’ time and accommodation costs due to Non-Tariff Barriers and delays at Mombasa port according to TradeMark East Africa

Shs750,000: Cash bond -an equivalent of $300 that Kenya slapped on Uganda’s containers last year.