STIMULATING DEVELOPMENT AND GROWTH OF PORTS ALONG THE AFRICAN COASTLINE John Omingo Head of Commercial Shipping Kenya Maritime Authority

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE  Requirements in Legislation  Dealing with Maritime Service Providers and Customs Authorities to: improve port efficiency and productivity stimulate growth in maritime economy COVERAGE

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE Regulation of Kenya’s Maritime sector; (Kenya Maritime Authority Act, 2006 and Merchant Shipping Act 2009);  Separation of regulation from operations;  Safety of Life at Sea;  International Maritime Conventions;  Regional Search and Rescue coordination;  Piracy information exchange centre;  Prevention and control of Marine Pollution;  Commercial Maritime Services; INTRODUCING KMA

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE Three main factors :  Safety and security  Efficiency and Productivity  Additional capacity PORT GROWTH ALONG THE AFRICAN COASTLINE

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE Safety of local and foreign ships with regard to:  Seaworthiness (Merchant Shipping Act, 2009)  Flag State Implementation  Port State Control;  Safe arrival and departure of ships;  Marine Pollution;  Search and Rescue SAFETY OF SHIPPING

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE  Today there are occurrences that are not accidents, but deliberate acts of a kind few of us could previously have imagined:  The US 9/11 Terrorist attack;  Piracy off the coast of Somalia; Transport related incidences impact human life SECURITY

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE  Vital component of port operations;  ISPS Code in ports and ships but security needed beyond the port - every node in the supply chain where each player is responsible for securing its leg of the supply chain;  National supply chain security standard which all parties in the supply chain can sign up to. Authorized Economic Operator (WCO – AEO) model for administering security compliance ; SECURITY

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE  Complex and entrenched beyond the capability of any one entity alone to effectively deal with;  Annual cost to the world economy : billion US dollars (Recent World Bank Report)  Annual Piracy Surcharge in Mombasa - over US$ 200 Mil Piracy

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE  Enhanced resources in the form of naval vessels and military aircraft;  Compliance with the best management practices while sailing through piracy-infested areas; Dealing with Piracy – Short Term measures

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE  Enhancement of legislation for prosecution;  Capture, prosecution and punishment of Pirates;  Tracing of ransom money;  Confiscation of proceeds of crime derived from hijacked ships;  Criminalization of piracy under domestic laws of States; Legislation

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE  Establishment of specialized anti-piracy courts in Somalia and other States in the region;  Provision of international assistance to help make Piracy courts operational;  Ultimate Solution A stabilized Somalia with a functioning Government and adequate resources to patrol the coastal areas from which the pirates operate and into which they bring hijacked ships pending negotiations Legislation

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE  Increase berth utilization;  Attract ships; Reduce overall cost of transport logistics; Increase volume of cargo; Stimulate growth of ports along the African Coastline In Africa (70% - State run ports), there is great need for supportive laws and maritime practices that address port transit times in order to: PORT EFFICIENCY AND PRODUCTIVITY

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE  No accountability for delays in the flow of cargo;  No standards on efficiency and quality;  Ineffective consultation machinery on maritime issues;  No Service level agreements – absence of competition;  Shortage of professionalism across the logistics chain; Industry Concerns

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE  Uncompetitive:  Importers’ minimal influence - most services are contracted by overseas sellers and buyers;  Little or no contractual obligation for timely delivery - importers locked into the services of: Shipping Lines and Agents Port Authority Container Freight Station Operators Cargo Consolidators Customs Authorities and other Government Agencies; Maritime Service supply - AFRICA

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE  Merchant Shipping (Maritime Service Providers) Regulations, 2010  Accountability structures: Establish Key Performance Indicators; Formalize obligations through Service Level Agreements Kenyan Response

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE  Develop Key Performance Indicators for service providers with – SLAs;  Establish structures for holding service provider accountable in the flow of goods/cargo - efficiency and speed of delivery;  Develop institutional capacity for the monitor of service delivery: SLAs; Single Window Cargo Clearance Legislation

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE  Predictable cargo clearance process and short transit times at the water/land interface;  Competitive supply of maritime transport services;  Effective interaction for better performance of the total transport logistics chain; Outcome

ADDITIONAL PORT CAPACITY Expand ports But most ports are surrounded by major cities Cities may benefit from ports, but Ports may also have a negative influence on cities such traffic congestion, air and noise pollution and security issues Open land next to ports is not readily available – increasing trend towards Green cities Develop new ports How long does it take to plan and develop new ports, infrastructure? Development of new port capacity in countries like China is fast, but in Africa it is much slower Utilize ICDs and CFSs - hub and spoke systems But, … How does it effect transit times and costs? Mombasa

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE  Focused attention on rail development - cleaner and greener;  Improved pipeline infrastructure to keep tankers off the roads;  Enhanced road infrastructure for cargo exit from the port; Cargo exit infrastructure

LEGISLATION THAT STIMULATES GROWTH OF PORTS ALONG THE AFRICAN COASTLINE CONCLUSION  Adopt a total logistics chain approach stimulate port growth. Overland systems with appropriate intermodal facilities: –Alleviates port congestion problems –Facilitates growth in cargo volumes; –Provides great competitive advantage to a port;  Enhance customs and other agency processes within ports and along inland transport corridor;  Utilize effective key performance indicators –Monitoring reliability, efficiency, costs and of performance Otherwise ‘ Complex port problems in Africa will have simple, easy to understand wrong answers!!’

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