Inland port deal flops: What next?
Nov 14, 2008
THE trade ministry has to plan for the establishment of a new inland port following nullification of a previous deal by the High Court.
By Mikaili Sseppuya
THE trade ministry has to plan for the establishment of a new inland port following nullification of a previous deal by the High Court.
In November 2007, the High Court nullified an agreement the trade ministry had made with a Kenyan company, Great Lakes Company to build a port in Tororo.
The agreement was reached at the beginning of the year. However, stakeholders complained.
One firm, Uganda Inland Port (UIP), filed a case with the High Court mid-year, saying the ministry had flouted the Procurement and Disposal of Public Assets Authority (PPDA) laws and called for a fresh tender.
UIP had also claimed that the agreement had ‘locked them out’ since they had already been shortlisted by the Uganda Investment Authority for a licence to put up an inland port in Kampala.
Another problem was a clause in the contract that had given Great Lakes exclusive rights to handle all cargo to and from Mombasa.
The court said Janat Mukwaya, the trade minister, had usurped the powers of the PPDA when she signed the agreement that had major implications for the country’s transport costs, yet she lacked the powers to make such a decision.
The spokesperson of the Uganda Freight Forwarders Association also said Great Lakes’ monopoly would leave them jobless.
She also objected to the clause, which gave Great Lakes power to set tariffs for the whole industry, saying it was a licence to raise tariffs without limits to the detriment of the country.
Others stakeholders said they were not consulted. This included truck-owners who felt that their future was threatened.
Mukwaya said the agreement was available at the ministry for the public to access. But most stakeholders were not convinced.
She also said the deal would give Ugandans more control over their imports since they would be on Ugandan territory and therefore, more easily accessible to them rather than expensively trekking to Mombasa for them.
The port was going to handle all outgoing and incoming goods for Uganda for the next 10 years at prices set by Great Lakes.
But since the contract has been cancelled, importers, exporters, clearing agents and other stakeholders have a chance to participate by applying for the tender to build one.
However, Kampala City Traders’ Association supported the deal, saying it would be good for commodities to be brought into Uganda first because traders would clear them from here rather than from Kenya.
Great Lakes is said to have carried out massive investments in preparation for the port, a situation, which makes compensation inevitable.
THE trade ministry has to plan for the establishment of a new inland port following nullification of a previous deal by the High Court.
In November 2007, the High Court nullified an agreement the trade ministry had made with a Kenyan company, Great Lakes Company to build a port in Tororo.
The agreement was reached at the beginning of the year. However, stakeholders complained.
One firm, Uganda Inland Port (UIP), filed a case with the High Court mid-year, saying the ministry had flouted the Procurement and Disposal of Public Assets Authority (PPDA) laws and called for a fresh tender.
UIP had also claimed that the agreement had ‘locked them out’ since they had already been shortlisted by the Uganda Investment Authority for a licence to put up an inland port in Kampala.
Another problem was a clause in the contract that had given Great Lakes exclusive rights to handle all cargo to and from Mombasa.
The court said Janat Mukwaya, the trade minister, had usurped the powers of the PPDA when she signed the agreement that had major implications for the country’s transport costs, yet she lacked the powers to make such a decision.
The spokesperson of the Uganda Freight Forwarders Association also said Great Lakes’ monopoly would leave them jobless.
She also objected to the clause, which gave Great Lakes power to set tariffs for the whole industry, saying it was a licence to raise tariffs without limits to the detriment of the country.
Others stakeholders said they were not consulted. This included truck-owners who felt that their future was threatened.
Mukwaya said the agreement was available at the ministry for the public to access. But most stakeholders were not convinced.
She also said the deal would give Ugandans more control over their imports since they would be on Ugandan territory and therefore, more easily accessible to them rather than expensively trekking to Mombasa for them.
The port was going to handle all outgoing and incoming goods for Uganda for the next 10 years at prices set by Great Lakes.
But since the contract has been cancelled, importers, exporters, clearing agents and other stakeholders have a chance to participate by applying for the tender to build one.
However, Kampala City Traders’ Association supported the deal, saying it would be good for commodities to be brought into Uganda first because traders would clear them from here rather than from Kenya.
Great Lakes is said to have carried out massive investments in preparation for the port, a situation, which makes compensation inevitable.