This week, the Lamu Port roared to life as it received the first ship, in a major development that is promising to change transshipment and logistics landscape not just for Kenya but also for the region and the African continent at large.
The commissioning of the facility provides an intermediary for ports that are not directly connected thereby providing seamless movement of cargo and containers.
With tens of shipping companies already committing to use the port on the backdrop of the government incentive to increase free storage period, Lamu Port could cut its niche area in the competitive shipping sector and further hoist the position of Kenya as a regional hub of connectivity and gateway to the East and Central Africa region.
The facility is also slated to open up economic opportunities for the surrounding areas with locals already registering better business returns. This is besides the job opportunities created by companies and government agencies based at the facility and beyond.
Global shipping routes
At a regional level, the operationalisation of the Lamu Port is an important stride in the implementation of the Lamu Port-South Sudan- Ethiopia Transport Corridor (LAPSSET) – in which the Port and associated highways link Kenya to Ethiopia and South Sudan.
Given the strategic geo-location of the port which sits at the intersection of major global shipping routes, the transport corridor was adopted by the African Union as a key plank in the actualization of the African Continental Free Trade Area (AfCFTA).
AfCFTA, which took effect in January 2021, is an ambitious integration programme that aims to bring together the continent under a single market of 1.2 billion people and GDP in excess of US$ 3.4 trillion. Infrastructure development and connectivity is a key cog in the realisation of this vision hence the importance of the Lamu Port, which will be complemented by the construction of an oil refinery, a modern railway line, and resort cities in northern Kenyan counties of Isiolo and Turkana.
It is on the basis of the port’s potential to enhance trade and regional connectivity that leaders from the East African Community and horn of Africa joined Kenya’s leader, Uhuru Kenyatta during the launch of the Port.
Standard Gauge Railway
Beyond Africa, the launch of the Lamu Port is also a major win for Kenya-China economic cooperation and the implementation of the Belt and Road Initiative in the continent. The Port was constructed by a Chinese firm, just like the earlier projects such as Kenya’s 578 kilometre Standard Gauge Railway that runs from the port city of Mombasa through the Capital Nairobi, to Naivasha.
China’s support for Kenya’s infrastructure modernization stands out with key deliverables in a variety of sectors. From roads, to railways and ports to energy projects, Chinese money, technology and expertise is fast transforming Kenya into a veritable BRI hub – all aimed at improving connectivity of Africa that currently lags behind other regions by a huge margin.
With over 400 Chinese enterprises currently operating in Kenyan and offering some over 4000 jobs to locals, China is also actively contributing to skills upgrading and technology transfer to partner African countries. Softer components of connectivity such as the smart city at the Konza Technopolis being implemented with the support of Beijing are primed to complement the network of harder infrastructure projects.
To build better prospects for the newly launched port, the Kenya National Highway Authority last week awarded a $166 million contract to China Communications Construction Company, to construct the 267 Kilometre Lamu-Garissa road. The company will also upgrade two other roads including the 113km section between Hindi and Kiunga, within the contract.
It is only by investing in wide ranging infrastructure projects that Kenya can set a robust basis of sustainable economic growth and development funding and technology has always remained out of reach.
Even with the kind of input that China has put in Kenya’s infrastructure upgrade, Nairobi still needs investments in excess of 40 billion US dollars in the next two decades in order to maximise its infrastructure potential.