The Kenya Ports Authority (KPA) is facing renewed opposition from transporters and clearing agents over its plan to venture into last-mile cargo delivery.
This comes as KPA relaunches its bid to implement an "end-to-end logistics solution" that would see cargo shipped and delivered directly to clients.
KPA argues the move will improve efficiency and reduce costs.
According to KPA Managing Director William Ruto, slow clearance processes and lengthy truck turnaround times are causing delays.
He also claims brokers are inflating costs and contributing to these delays.
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“The decision is informed by industry trends where brokers whom apart from increasing the final cost of freight, at most times fail to deliver cargo on time,” Ruto said.
The plan involves partnering with international shipping lines, with COSCO Shipping Lines being a frontrunner.
However, the Kenya International Freight and Warehousing Association (KIFWA) and the Kenya Transporters Association (KTA) see this as a threat to their businesses.
They fear job losses and the potential bypassing of local players in the logistics chain.
Kifwa Chairman Roy Mwanthi warned of massive job losses and threatened to use all means at their disposal to resist the plan.
"We are talking of massive job losses which we will not allow. Both KTA and Kifwa shall use all means at their disposal to resist the move to consign Kenyans to poverty," Mwanthi stated.
KTA echoed these sentiments, stating their position remains unchanged. They have previously threatened to withdraw services if KPA proceeds.
The move also raises concerns for the Standard Gauge Railway (SGR) freight operations as existing contracts with road transporters for last-mile delivery could be jeopardized, potentially leading to legal battles.
President William Ruto's directive to return port services to Mombasa further complicates the issue.
KIFWA argues KPA's plan contradicts this directive and could harm local businesses.
"KPA should stick to its mandate which is to operate, maintain, manage, and develop ports within the country" KIFWA emphasised.
"It has no business engaging in provision of logistics services,
The plan is not without its supporters because the Shippers Council of Eastern Africa believes an end-to-end solution is achievable through partnerships, but emphasizes the need to involve all stakeholders, including transporters and shipping lines.
"The end-to-end solutions being mooted is welcome and will most probably be achieved through partnerships and cooperations with discussions with Kenya Railways on service delivery and pricing structure," their CEO Agayo Ogambi said.
KPA maintains they are working with stakeholders, but the future of the plan remains uncertain.
With significant opposition and potential legal challenges, KPA may need to find a way to address concerns before it can move forward.
