BARAYAN: The path to Mombasa’s Industrialisation

Kenya Port Authority is considered the premier employer in the coastal region of Kenya with a staff of approximately 6,500 employees.

What is not known to many, especially those of us under 50 years is that there once existed a company called Kenya Cargo Handling Services, whose sole purpose was stevedoring - the loading and discharge of ships cargo.

The absorption of this company by the KPA in the late 70s became inevitable when stevedoring became mechanised due to greater use of shipping containers in transportation of goods. KPA, which has had the culture of adopting emerging technical trends to increase its efficiency, has managed to remain the port to beat in the region currently having one day turn-around, while Dar es Salaam and Djibouti have up to 16 days and five days, respectively.

All the same, unlike most port cities worldwide, Mombasa is yet to have a remarkable industrial and manufacture sector, with it's GDP being just 17.8 per cent of Nairobi's GDP and 24 per cent that of Dar es Salaam, despite Nairobi being 500km in the interior and Mombasa handling 160 per cent more cargo than Dar Es Salaam.

All this is set to change.

The much talked about but not fully explained Dongo Kundu Special Economic Zone can bring about exponential growth of the industrial and manufacturing sectors in Mombasa.

Industries tend to be located where the raw materials or markets are most securely accessible. Labour, capital and entrepreneurship are often more mobile. One such location is in the Dongo Kundu SEZ in Mombasa, which shall be in a position to produce both goods and services for the entire markets of East African Community; the Common Market for Eastern and Southern Africa; and the African Continental Free Trade Area.

A SEZ is a physical gazetted geographical area with economic and financial laws designed to attract industry and manufacture of goods and services.

But how exactly would this special economic zone bring unprecedented industrialisation to Mombasa.

Let us take the example of televisions to illustrate how it works.

The number of television in Kenya is estimated at 5.2 million sets, with a demand projected at 500,000 sets in the high-end, mid-range and entry-level categories. A television manufacturing company which doesn't employ expensive artificial intelligence robotics employs about 200 people and has an output of 40,000 units a year.

To satisfy 50 per cent of Kenya's demand for televisions, five such factories employing a total of 1,000 persons shall be required in the assembly plants. And that is only Kenya. Add to this the Comesa, EAC and AfCFTA, and you begin to see why it might be worthwhile of a Chinese manufacturer of TVs to set up a factory in the Mombasa SEZ.

The level of skilled labour required for factories such as the television assembly plant and its supply chain manufacturers would then be able to start absorbing the 367,925 learners who graduate out of the 2,401 technical and vocational education training institutions in Kenya, most of whom are under 24 years old.

Statistics show any employed person spends no less than a total 55 per cent of their income within the town they work on food, accommodation, utilities, transport and recreation. The multiplier effect of this expenditure would be a demand for more houses, food outlets and commuter transportation as the local economy booms.

And no less important for the establishment of a thriving SEZ, the KPA now has at its management helm a ship captain of Class 1 master mariner qualification who understands how critical ship turn-around is to port efficiency.

Manufacturers could be certain that their imports would be delivered on schedule.

The authority is domiciled in the department of transport whose Principal Secretary is a highly capable native of Mombasa, able to understand all the moving parts that would synergise port logistics to enable industrialisation.

Mombasa has been deliberately placed on the path of becoming an industrial port city, much like Shanghai and Guangzhou in China, or Europe’s Rotterdam (Netherlands), Hamburg (Germany) or Antwerp (Belgium).

This quest has long been a dream. Now it is set to become a reality.

The writer is a lawyer 

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