Kenya Ports Authority was coerced to give away the Sh52 billion new Second Container Terminal to a private operator, Roads, Transport and Public Works CS Kipchumba Murkomen now says.
The CS who has also promised to make public the Standard Gauge Railway (SGR) contract said he is keen to reverse a number of decisions touching on port operations.
They include allocation of public land near port facilities and terminals at the port to private investors.
Among them is the controversial multi-billion contract given to a private firm at the Nairobi Inland Cargo Terminal by the Kenya Railways Corporation.
The major deal Murkomen has taken issue with however, is the take over of operations of phase II of the second container terminal at the Port of Mombasa.
The project, which commenced in September 2018, was commissioned last year.
It was financed through a government-to-government loan facility from the Japanese government under the Japan International Cooperation Agency (Jica), with Japanese firm- Toyo Construction Company Limited, as the contractor.
The first phase of the second terminal, which was built at a cost of Sh26 billion, was completed in 2016 and is being operated by KPA.
The Mediterranean Shipping Company (MSC) was given a green light to take over operations at the second phase, after receiving approvals from the Comesa Competition Commission.
This is after MSC – through its wholly owned subsidiary Shipping Agencies Services Sarl (SAS) secured a joint control of the Kenya National Shipping Line (KNSL), with the Kenya Ports Authority (KPA).
The shipping line increased its stake in KNSL to 47 per cent while KPA has a stake of 53 per cent, a move that was opposed by part of the authority’s management.
Speaking on Wednesday night during an interview, on a local TV station, the CS (who however avoided mentioning the company) said the contract award was unprocedural.
“The facility was handed over for free without any meaningful consideration on the part of government. I have a duty to correct to the best of our ability the things that happened in the past,” Murkomen said.
He lauded part of KPA management, which opposed the deal, pledging to work closely with the team to reverse the same.
"I have the benefit of having information that is well documented by patriots… I am happy that they are still there and they will be working with us to see how can we reverse this,” the CS said.
On approving the shareholding in KNSL, the regional competition watchdog had cautioned against locking out of other liners saying the deal should not offer preferential treatment to any, including MSC.
It also limits how much information on port operations that KNSL can share with MSC.
“KNSL will not exclusively allocate the capacity of the container terminal two to one container liner shipping company and shall operate it under a common user facility principal,” said the Commission in its determination.
The Dock Workers Union, Taireni Association of Mijikenda and the Muslims for human rights (Muhuri) moved to court opposed the move.
They claimed the government had secretly and without involving the petitioners and members of the public, negotiated and entered into a Memorandum of Understanding with a foreign private company over the operation and management of the facility.
Meanwhile, the new administration will not be committing to any major new infrastructure projects, Murkomen noted.
It will be seeking to complete existing once with timelines of between eight months and the next four years, depending on their current completion rate.
