Tororo dry port to solve traders’ woes
THE post-election violence in Kenya does not come at a worse time for Ugandan traders. <br>Over 4,000 containers and 8,000 new cars destined for Kampala are already hoarded and ‘rotting’ at Mombasa port.
By Joel Ogwang
THE post-election violence in Kenya does not come at a worse time for Ugandan traders.
Over 4,000 containers and 8,000 new cars destined for Kampala are already hoarded and ‘rotting’ at Mombasa port.
With flactuating fuel prices, traders have to contend with what is now a national crisis.
Add to the news that three loaded trucks destined for Kampala were burnt in Kisumu and nightmares replace the traders’ miseries.
“It is now risky to transport goods from Mombasa to Kampala,†says Issa Ssekitto, the Kampala City Traders Association (KACITA) spokesman.
As a result, local traders have stopped transporting their merchandise. Those who insist part with up to sh600,000 in escort fees paid to Kenyan security personnel.
“Traders should be patient and wait until the chaos subsides,†Ssekitto advises. “We are in trouble.â€
Uganda is a landlocked country. As a result, she relies on Mombasa and Dar-es-Salaam ports to import and export 85% of her cargo.
Even before the current chaos, Kenya Ports Authority (KPA) and Kenya Revenue Authority (KRA) has been exploiting this disparaging situation to over-charge Ugandan traders.
For example, cargo staying for more than 21 days accrues custom warehouse charges of Ksh100 per cubic meter or tonne.
Cargo staying for more than 90 days pays punitive charges and is also liable to being auctioned. The proceeds stay in Kenya.
“Sometimes the clearing charges outstrip the cargo cost,†Sekitto says. This situation sometimes forces Ugandan traders to abandon their cargo.
In the event that the trader clears the cargo dues, the burden of the taxes is passed onto the customer.
This is partly the reason most commodities are sold at high prices.
In his 2005/6 financial year budget, the finance minister Ezra Suruma, noted that delays, customs warehouse rental fees and port storage charges were affecting local traders.
Discussions were held between the two neighbouring countries. Kenya agreed, in principle, to consider waiving the charges.
The problem has, however, persisted.
Kenya also allowed Uganda to develop its own holding facilities at Mombasa port.
Tororo dry-port project
To mitigate these costs, the government rooted for the construction of a $250M (about sh437.5b) dry-port in Tororo.
Capt. P.N.W. Musoke, the project manager, says the project aims at reducing transportation costs of Uganda’s shipments which pass through Mombasa port.
“It is a 10-year concession project,†he says. “We believe that when finalised, it will take only seven days to transport cargo from Mombasa to Kampala.â€
Musoke says while it takes seven days to transport cargo from Dubai to Mombasa, getting the same cargo to Kampala from Mombasa takes more than a month.
The dry-port will have a 60-acre container stacking yard, two 484x20ft ground slots.
“It will also have a 20,000 square-meter warehouse, industrial zone and two commercial centers,†Musoke says.
The first phase of the project, dubbed ‘The Great Lakes CTS-Uganda Project’, would consume between $100m (about sh175b) and $150m (about sh262.5b).
Work on the project kicks off later this year. Musoke says ground-breaking would take place ‘soon’.
Musoke says once operationalised, costs and duration of transportation cargo from Mombasa to Kampala will drop.
Plans are also underway to build a mini-port for local traders’ shipments in Changamwe, Kenya.
The temporary holding ground which will stand on 16-acre land, will have 1,134 ground slots and a static capacity of 5,670.
It will also have access to road and railway network, a warehouse, a container stacking yard and a weighing office.
Musoke says while Mombasa port is congested, KPA has no plans to expand it.
“There is no land for expanding Mombasa port. Changamwe will be a short-term handling point for containers destined for Kampala,†he says.
In August 2007, Great Lakes port, the funders, signed a memorandum of understanding with KACITA and the Uganda clearing and forwarders association (UCIFA).
The memorandum will help in solving disputes arising between the parties through mutual liaison and consultations.
Umar Kasim, the UCIFA chairman, says with the fast-tracking of the East African federation on course, the project would ease trade in the region.
“Much of Uganda’s exports end up in Southern Sudan,†he says. “There will be ease in accessing markets in Rwanda and Burundi when the dry-port is in place.â€
Tororo county MP, Geoffrey Ekanya, says the project was long overdue. “Some one living near a lake will ask for nets for fishing,†he says. “We have, for long, wanted a dry-port in Tororo.
Ekanya says he advocated for a dry-port in Tororo even before going to parliament.
The project is, however, facing stiff opposition from the Uganda Freight Forwarders Association and officials from the Private Sector Foundation.
“UFFA, backed by some government officials, wants exclusive rights to transport shipments,†says Musoke.
To ascertain the viability of what may become the country’s biggest project, President Yoweri Museveni recently instituted an inter-ministerial committee.
Ezra Suruma, the finance minister, chairs the committee. Apparently, 80,000 local traders use Mombasa port to store and transport 85% of their cargo.
Benefits from the project
First and foremost, the current adversaries caused by the post-election violence in Kenya would be in check.
Traders would store their cargo at the dry-port and access them easily. Smuggling has been a problem for the Uganda Revenue Authority (URA).
Once the dry-port is in place, URA and the Uganda national bureau of standards will be able to monitor and control quality of imported products from a central point.
“Bankers will be able to recover monies from auctioned goods in failed transactions,†says Musoke.
The dry-port would foster opening up of trade opportunities to southern Sudan and central Africa using the Tororo-Pakwach railway.
Paul Mukasa, a car dealer, is optimistic that the construction of the Tororo dry-port will ease cargo transportation into Uganda.
“I don’t think our fellow Ugandans can treat us like the Kenyans,†he says. “One day a freight driver delayed my cargo by two months and when I asked why, he said he didn’t care because he wasn’t my brother!â€
Patrick Mukiibi, URA spokesman, regrets the delays local traders face at Mombasa port.
“It is our interest to see that traders get the products into the country easily,†he says. “Any delays mean our (URA) tax collections will drop.â€
He urges KPA to ensure that delays at the port are reduced to ease the fast tracking of the East African Community.
“We (URA) are concerned when traders are delayed,†he says.
“We will not hesitate to help where we can.â€
THE post-election violence in Kenya does not come at a worse time for Ugandan traders.
Over 4,000 containers and 8,000 new cars destined for Kampala are already hoarded and ‘rotting’ at Mombasa port.
With flactuating fuel prices, traders have to contend with what is now a national crisis.
Add to the news that three loaded trucks destined for Kampala were burnt in Kisumu and nightmares replace the traders’ miseries.
“It is now risky to transport goods from Mombasa to Kampala,†says Issa Ssekitto, the Kampala City Traders Association (KACITA) spokesman.
As a result, local traders have stopped transporting their merchandise. Those who insist part with up to sh600,000 in escort fees paid to Kenyan security personnel.
“Traders should be patient and wait until the chaos subsides,†Ssekitto advises. “We are in trouble.â€
Uganda is a landlocked country. As a result, she relies on Mombasa and Dar-es-Salaam ports to import and export 85% of her cargo.
Even before the current chaos, Kenya Ports Authority (KPA) and Kenya Revenue Authority (KRA) has been exploiting this disparaging situation to over-charge Ugandan traders.
For example, cargo staying for more than 21 days accrues custom warehouse charges of Ksh100 per cubic meter or tonne.
Cargo staying for more than 90 days pays punitive charges and is also liable to being auctioned. The proceeds stay in Kenya.
“Sometimes the clearing charges outstrip the cargo cost,†Sekitto says. This situation sometimes forces Ugandan traders to abandon their cargo.
In the event that the trader clears the cargo dues, the burden of the taxes is passed onto the customer.
This is partly the reason most commodities are sold at high prices.
In his 2005/6 financial year budget, the finance minister Ezra Suruma, noted that delays, customs warehouse rental fees and port storage charges were affecting local traders.
Discussions were held between the two neighbouring countries. Kenya agreed, in principle, to consider waiving the charges.
The problem has, however, persisted.
Kenya also allowed Uganda to develop its own holding facilities at Mombasa port.
Tororo dry-port project
To mitigate these costs, the government rooted for the construction of a $250M (about sh437.5b) dry-port in Tororo.
Capt. P.N.W. Musoke, the project manager, says the project aims at reducing transportation costs of Uganda’s shipments which pass through Mombasa port.
“It is a 10-year concession project,†he says. “We believe that when finalised, it will take only seven days to transport cargo from Mombasa to Kampala.â€
Musoke says while it takes seven days to transport cargo from Dubai to Mombasa, getting the same cargo to Kampala from Mombasa takes more than a month.
The dry-port will have a 60-acre container stacking yard, two 484x20ft ground slots.
“It will also have a 20,000 square-meter warehouse, industrial zone and two commercial centers,†Musoke says.
The first phase of the project, dubbed ‘The Great Lakes CTS-Uganda Project’, would consume between $100m (about sh175b) and $150m (about sh262.5b).
Work on the project kicks off later this year. Musoke says ground-breaking would take place ‘soon’.
Musoke says once operationalised, costs and duration of transportation cargo from Mombasa to Kampala will drop.
Plans are also underway to build a mini-port for local traders’ shipments in Changamwe, Kenya.
The temporary holding ground which will stand on 16-acre land, will have 1,134 ground slots and a static capacity of 5,670.
It will also have access to road and railway network, a warehouse, a container stacking yard and a weighing office.
Musoke says while Mombasa port is congested, KPA has no plans to expand it.
“There is no land for expanding Mombasa port. Changamwe will be a short-term handling point for containers destined for Kampala,†he says.
In August 2007, Great Lakes port, the funders, signed a memorandum of understanding with KACITA and the Uganda clearing and forwarders association (UCIFA).
The memorandum will help in solving disputes arising between the parties through mutual liaison and consultations.
Umar Kasim, the UCIFA chairman, says with the fast-tracking of the East African federation on course, the project would ease trade in the region.
“Much of Uganda’s exports end up in Southern Sudan,†he says. “There will be ease in accessing markets in Rwanda and Burundi when the dry-port is in place.â€
Tororo county MP, Geoffrey Ekanya, says the project was long overdue. “Some one living near a lake will ask for nets for fishing,†he says. “We have, for long, wanted a dry-port in Tororo.
Ekanya says he advocated for a dry-port in Tororo even before going to parliament.
The project is, however, facing stiff opposition from the Uganda Freight Forwarders Association and officials from the Private Sector Foundation.
“UFFA, backed by some government officials, wants exclusive rights to transport shipments,†says Musoke.
To ascertain the viability of what may become the country’s biggest project, President Yoweri Museveni recently instituted an inter-ministerial committee.
Ezra Suruma, the finance minister, chairs the committee. Apparently, 80,000 local traders use Mombasa port to store and transport 85% of their cargo.
Benefits from the project
First and foremost, the current adversaries caused by the post-election violence in Kenya would be in check.
Traders would store their cargo at the dry-port and access them easily. Smuggling has been a problem for the Uganda Revenue Authority (URA).
Once the dry-port is in place, URA and the Uganda national bureau of standards will be able to monitor and control quality of imported products from a central point.
“Bankers will be able to recover monies from auctioned goods in failed transactions,†says Musoke.
The dry-port would foster opening up of trade opportunities to southern Sudan and central Africa using the Tororo-Pakwach railway.
Paul Mukasa, a car dealer, is optimistic that the construction of the Tororo dry-port will ease cargo transportation into Uganda.
“I don’t think our fellow Ugandans can treat us like the Kenyans,†he says. “One day a freight driver delayed my cargo by two months and when I asked why, he said he didn’t care because he wasn’t my brother!â€
Patrick Mukiibi, URA spokesman, regrets the delays local traders face at Mombasa port.
“It is our interest to see that traders get the products into the country easily,†he says. “Any delays mean our (URA) tax collections will drop.â€
He urges KPA to ensure that delays at the port are reduced to ease the fast tracking of the East African Community.
“We (URA) are concerned when traders are delayed,†he says.
“We will not hesitate to help where we can.â€