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Citizen Weekly

Sunday, 18 January 2015

Dock Union tells government to go slow on privatisation of port’s container terminal

The government should halt plans to privatise the second container terminal and instead adopt commercialisation concept which is more suitable for the port of Mombasa, the dock workers union has said.
The union’s general secretary Simon Sang said in a statement last week that Kenyans stand to reap nothing from the intended privatisation of the second container terminal in spite of the heavy investment by the government.
The unionist said a few well connected individuals with an eye on 2017 general elections are out to mint billions of shillings at the expense of Kenyans. He further said the move has the potential to render the existing container terminal irrelevant hence massive layoffs of employees.
Reacting to an advertisement that was put up in the media in December last year  by KPA management calling on private operators to apply to manage the new second container, Sang said commercialisation remains the best option which the government should explore if it was serious about transforming the port of Mombasa to world class port status. Sang noted that privatisation of port facilities is not the answer to efficiency.
“Port of Tema in Ghana with a throughput of 500,000 TEUs and port of Dar-es-Salaam with a throughput of 600,000 TEUs were privatised in 2004 and 2007 respectively but to date, there is nothing to be proud of.
Port of Durban, the best performing Port in Africa, Port of Dubai, the best performing port in Middle East and port of Singapore the sixth best performing port in the world are all not privatised but today, they are in world class leagues without any privatisation input,” he pointed out.
He said the concept the above ports adopted which is the most suitable for any seriously developing country is commercialisation autonomous process. Dock Workers’ Union supports commercialisation autonomous as the best game changer, he added.
Sang said commercialisation process requires that management or governance of the port is detached from undue political intervention and instead its management placed in the hands of vetted professionals and left to run in an autonomous manner and base its operations on commercial principles.
“Port management was deliberately left to sink to a level where everybody believes that it can only be salvaged or resuscitated through privatisation. This is because those with vested interests have ensured that dockworkers union leadership has been demonised in its quest for agitating for a different approach to improving performance without privatisation,” he lamented.
However, he said Dock Workers’ Union will negotiate with the government to have the operator as advertised to bring its own business in form of trans shipment business. “Dock union through the ministry of Transport and Infrastructure  will negotiate with Treasury cabinet secretary to compel Kenya Revenue Authority to allow trans shipment business if Kenya Ports Authority is to grow the port business by over 500,000 TEUs. This, therefore, means that our support for anticipated concessioner is on condition that it generates its own business through trans shipment business,” he said.
He regretted that currently, only a negligible percentage of the said business pass through the port of Mombasa because of Kenya Revenue Authority’s refusal to give clearance to that type of business.
 In other countries, he said, their ports grew tremendously to their current levels because of trans shipment business. Port of Singapore for instance handles up to 17 million TEUs and 80pc account for transshipment business, he said
“Other ports with similar arrangements are Ports of Salala, Jebel Ali in Dubai among others. Kenya is blessed to be positioned strategically geographically and if allowed to handle transshipment business, it can grow its business in the next 12 months to the tune of 1.5 million TEUs, a growth of 50pc,” he said.