*China Through SGR To Take Over Mombasa Port*
March 7, 2018
Over the last couple of weeks, news that China had taken ownership of a major Port in Sri Lanka was trending in Kenya for all the wrong reasons and biggest of all was fear.
Sri Lanka had taken too much debt from China to invest in infrastructure and started having issues with the payments.
The New York Times reports;
Struggling to pay its debt to Chinese firms, the nation of Sri Lanka formally handed over the strategic port of Hambantota to China on a 99-year lease last week, in a deal that government critics have said threatens the country’s sovereignty.
Kenya built the SGR from Mombasa to Nairobi at a *highly inflated cost of 327 billion*.
*Economic experts at the time had advised the government to instead spend a mere 16 billion and do the same job.*
Against all the bravado and digitization PR the government could master, it went ahead in constructing a whole new line at that inflated cost. *Other countries achieved much faster trains and more modern technologies for much less $$.*
*Now here is the problem, the loan for the construction of the SGR was actually insured by the Mombasa Port. A deal was agreed to that the port will provide business to the SGR.*
KPA is required to provide at least 6Million Tonnes annually to SGR or pay the difference where a shortfall occurs.
Because of this, a decree was issued that all containers destined for Nairobi and beyond will be transported by the SGR to the ICD in Nairobi for clearance. Problem is that the numbers are not working.
The passenger numbers expected cannot sustain running of the SGR passenger service. What this has resulted is increase in fares from the initial Sh 700 to now Sh1200 and numbers still dont add up.
The containers too are not working out. Aside from the big inconvenience to importers and the massive losses of jobs in Mombasa, the containers do not make enough to sustain the project.
*The SGR debt cannot be paid by the operations of the SGR itself (both the containers and passengers) and KPA cannot pay the difference as the funds are just not there.*
*So at the end, Kenya now faces the same situation as Sri Lanka, the Port was used as collateral and the option of leasing the management of the Port and SGR to China to offset the debt is becoming more real by the day.*
Habari za kutoka
China Through SGR To Take Over Mombasa Port a one man blogsite!!!!!!! Hakuna kitu kama hicho kilicho fanyika eti port ya mombasa ndo ilikua security...... 1.We took a government to government commercial loan thus any default will result in a negotiation between the two countries 2. port ya Mombasa ilijengwa na mjapani na pia expansion and mordernisation inafanywa na loani za mjapani to a tune of $1 Billion USD, kwahivyo haiwezi ikachukuliwa na mchina wakati mjapani ndo anaijenga. ni mjapani tu ndo anaweza kuchukua bandari, no one else
2007
The Japanese government has finally agreed to finance the Mombasa Port Development Project to the tune of 26.7 billion Yen ($250 million). The project, which is expected to be complete by 2018, will more than double the port’s current container handling capacity.
Japan gives Kenya $250m for expansion of Mombasa port
2015
Japan will on Friday advance to Kenya a Sh25 billion ($270 Million)loan to fund the second phase of Mombasa port expansion.
The money, to be given through the Japan Bank for International Corporation (JBIC), is earmarked for the construction of a new container terminal by reclamation of the West Kipevu to create an additional 3 berths.
“The proposed project includes construction of a new port access road connecting the new container terminal with the existing Port Reitz Road that leads to Nairobi and inland bound highways,” the project document reads.
Kenya signs Sh25 billion deal with Japan for Mombasa port
July, 2017
Japan extends Sh11.8Bn loan for Mombasa Port, South Coast link roads
The government of Kenya has received a Sh11.8 billion ($118 million ) loan from the Japanese Government to fund the construction of the second phase of the Mombasa Port Area Road Development project.
National Treasury Cabinet Secretary Henry Rotich says the funds will go towards the high priority project, which is expected to offer easy access to the region, mobility and transportation of goods and passengers.
Japan extends Sh11.8Bn loan for Mombasa Port, South Coast link roads - Capital Business
October 2017
MOMBASA PORT EXPANSION GETS $340M BOOST FROM JAPAN
The terminal will be built on 100 acres at Kilindini Harbour with the help of Japanese construction technology. It will have three berths with quay lengths of 230, 320 and 350m able to handle Panamax container ships of 20,000 dead weight tonnes (DWT) and Post Panamax vessels of 60,000 DWT.
The announcement was made by Catherine Mturi-Wairi, the managing director of the
Kenya Ports Authority (KPA), who
said: “We already have the financing from the Japanese government. We are now in the tendering process but construction must commence by January 2018.”
The need to begin work quickly reflects the race between
Kenya and
Tanzania to establish themselves as the
trade gateway for the wider east and central African regions. Both countries are fitting their main
ports with multibillion dollar standard gauge rail lines to the Great Lakes countries of Rwanda,
Burundi and Uganda.
The Mombasa Port Development Project was begun in March 2012 with help from the Japan International Cooperation Agency. In February 2016 the project delivered
three additional berths, and the following September it completed a container terminal with a capacity of 550,000 teu, which raised the port’s total capacity to 1.5 million teu, making it the largest container port between Durban in South Africa and Port Said in Egypt.
The third phase of the scheme is due to be completed in 2022, and will include the construction of one more berth, the procurement of equipment and dredging work to increase the capacity of Mombasa’s approach channel and turning basin
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Thats $250m+270m+118m+340m = Total inakuja $970m , tena hapo highlight kwa last document inaonyesha bado phase 3 ambayo inatarajiwa kukamilika 2022 ambayo itahusisha ujenzi wa berth mpya, mjapani ndo ataendelea kuishughulikia.
Oh, and last but not least .
3. Loan ya SGR iko na 10 years grace period, ili kuruhusu ijengwe hadi Uganda ndo tuanze kuilipia,the loan was signed on 2013, SGR is expected to reach kampala 2020-2022, we star paying the loan in 2023. its only been 2 months and 9 days since freight service was launched jana niliona train ya mizigo ikisafiri na usiku saa saba usiku ikiwa full, kawaida hua zinasafiri na mchana pekee, kama zimeanza kuingia night shift it means business is picking up, kawaida unaipatia any business 6months to 18months kabla ku judge kama inaanguka au inapaa, its only been 2months, what do you thinks if we did the same with ATCL.... Or we wait for your SGR to launch cargo service then give them 2 months to immediately attract all the business, remember its not about being cheap, its about convinience, e.g if they cant pay for transpo, they want the ICD to store the goods for them just like what the private CFS used to do on behalf of the customer, would magufuli allow the port to loose revenue and storage space by storing goods for free at the ICD? Those are the challenges that are bieng worked on right now, maybe you can learn a thing or two so you don't have to face the same first time problems