Uganda is unwilling to use the Naivasha Inland Container Depot as its key transit cargo handling facility despite Kenya’s push to relocate operations from Mombasa and Nairobi.
According to Transport Cabinet Secretary James Macharia, all transit cargo destined for the hinterland will effective June 2, be cleared and collected from the Naivasha facility.
However a communiqué from Uganda’s Ministry of Works and Transport, seen by the Star, however, indicates the neighboring country is not ready for Naivasha and would prefer to continue picking their cargo from Mombasa.
Kenya’s move is aimed at among others, reducing the distance and exposure to Covid-19, even as the Northern Corridor remains on red alert.
“Naivasha will be a transshipment centre. Instead of driving all the way to Mombasa, another 600 kilometers, they will be picking cargo from Naivasha,” Macharia said on the telephone.
But according to Uganda’s Minister of Works and Transport Edward Katumba-Wamala, the use of the Naivasha ICD for transit cargo would not reduce traffic, as truck drivers will still be required to pick containers from Naivasha to their destination.
“Therefore, it is our considered opinion that the use of Naivasha ICD which is part of our long term regional infrastructure development should remain optional,” Katumba says in a letter to Macharia.
He says if Kenya makes it more attractive, big industry players and shippers such as Bollore Logistics , Mukwano Group of Companies and others “can be encouraged to start using this facility because of economies of scale.”
Katumba however affirmed Uganda’s commitment to the development of regional infrastructure and monitoring of truck drivers to reduce the impact of the Covid-19 pandemic .
CS Macharia, Katumba and their Rwandan transport counterpart are expected to hold discussions tomorrow (Friday) to iron out existing obstacles, even as the Kenyan government insists on the use of the Naivasha facility.
According to Macharia, the use of Naivasha is in line with the region’s Heads of State agreement to put in place measures to contain the coronavirus.
“This is our position and we are going to implement,” Macharia said yesterday.
China Communications Construction Company Limited handed over the Sh6.9 billion facility to the government on May 7, when CS Macharia led a delegation of government officials to release the first 200 TUEs destined for Uganda.
The facility comprises over 1,000 acres of space with a marshalling area able to hold 700 trucks at any given time.
To support cargo clearance, Kenya Revenue Authority (KRA) on Tuesday said it has commenced operations at Naivasha.
“The transfer will decongest the Port of Mombasa and improve efficiency at the facility,” acting Commissioner for Customs and Border Control Pamela Ahago said in a statement.
Uganda’s, decision which the ministry says was in consultation with the private sector, appears more of a strategy to continue cashing in on long-haul transport charges on the 1,144 kilometres stretch between Mombasa and Kampala.
Currently, it costs an average of $2,100 (about Sh225,120) to move a 20-foot container from Mombasa to Kampala.
The SGR to Suswa reduces the distance by about 527 kilometres, meaning relief for importers and exporters but a cut on earnings to transport companies.
“SGR takes 10 hours from Mombasa to Naivasha saving clients 18 hours,” Macharia said, adding that the use of the new facility will also reduce road damages, accidents and increase efficiency in cargo movement.
Uganda accounts for 83.2 per cent of transit cargo through the port of Mombasa. South Sudan takes up 9.9 per cent while DR Congo, Tanzania and Rwanda account for 7.2 per cent, 3.2 per cent and 2.4 per cent respectively.
The Naivasha facility has a One Stop Centre (OSC) model where all key government agencies offer their services to clients.
Regional revenue authorities including Uganda Revenue Authority, Rwanda Revenue Authority, Tanzania Revenue Authority and Burundi Revenue Authority are housed at the OSC.
“KRA is well equipped to handle the huge capacity expected from Uganda, Rwanda, and Burundi at the facility. The ICD will increase efficiency, as KRA is able to monitor cargo in Naivasha through the Joint Monitoring Centre,” Ahago said.