The Transporter Issue 25

A PUBLICATION OF THE KENYA TRANSPORTERS ASSOCIATION

ISSUE 025 | VOL. 1

WEIGH-IN-MOTION

REVOLUTION New technology expected to speed up freight REGIONAL

EAC infrastructure investment blueprint The Transporter endorsed

The scales will save taxpayers millions in road repairs RAILWAY

SGR to boost Kenya’s GDP growth

They will reduce opportunities for corruption

PROFILE

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Transporter

The

ISSUE 025

WEIGH-IN-MOTION

REVOLUTION

COVER STORY

20

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EDITORIAL

CONTENTS

VOLUME 1

REGULARS

00| From the CEO’s desk 02| Updates 04| KTA News

BRIEFS

06| At a Glance 08| Making News 10| In Bits REGIONAL 14| More NTBs recorded in Bagamoyo port project 16| EAC infrastructure

blueprint endorsed 17| China agrees to boost infrastructure investment in Kenya 18| Fund to help reduce EAC freight cost

INFRASTUCTURE

30

World Bank pledges

$1.2 BILLION to East Africa

REGULATION

32| Transporters sign charter to curb overloading 48| Truck World

RAILWAY

36| SGR to boost Kenya’s GDP growth 37| Give locals priority in ongoing

SGR project: Uhuru

TECHNOLOGY

38| Online system facilitates cargo clerance

PORTS

40| KPA hits a record 1 million TEUs mark 42| African inland infrastructure woes cost shippers dearly

49| Global

LOGISTICS

44| New roads to ease traffic jam in Mombasa 45| Second Nyali bridge to be built soon, says Transport CS CUSTOMS

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VOI-TAVETA ROAD Delays use of Holili OSBP

INTEGRATION

46| Ugands traders not aware of Single Customs Territory

50| Truck & Trailer

Transporter

The

A publication of the Kenya Transporters Association Limited

From the CEO’s Desk

BOARD OF DIRECTORS

Paul Maiyo Kiprop Bundotich Hassan Bayusuf Gulam Yusuf Iqbal A. Bayusuf Salad Awale Imran Pasta Zahir Kara Shakil Khan ACTING CEO

Willington Kiverenge LAYOUT, DESIGN & EDITORIAL CONSULTANTS

Efman Communications info@efmancommunications.com

All inquiries: Tel: +254 707 815 878/ 786 815 878 Fax: +254 41 231 20 15 Mobile: +254 786 366 538, 734 619 494 Email: thetransporter@kta.co.ke

The Transporter is published quaterly by the KenyaTransportersAssociationLimited(KTALtd).

The views expressed are those of the authors and do not represent the official view of the Kenya TransportersAssociationLimited(KTALtd).Neither KTA Ltd nor Efman Communications, or any other personactingontheirbehalf,maybeheldresponsible for the use to which information contained in this publicationmaybeput,oranyerrors,which,despite careful preparation and checking, may appear.

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ISSUE 25 VOL. 1

T

he year 2014 witnessed unprecedented shift in modus operandi at the Port of Mombasa and on the Northern Corridor.

The signing of the Mombasa Port Community Charter and the Self regulatory charter on vehicle load control marked the hallmark of the much needed shift. At least stakeholders have an understanding and appreciation that the Port Community must have congruence of purpose and synergize their processes.

The Mombasa Port Community charter sets to realise a number of goals, key among them; achievement of an average of 120,000 km per truck per annum by December 2016; and achievement of 70% cargo throughput through the green channel. Truck turnaround or performance has been beset by a number of issues including ineffective operational models by key players. In order to achieve the globally acceptable truck mileage per annum, the operational models must be enhanced. Being a key signatory to the charter, KTA is committed to see to it that transporters review their operating procedures to meet the desired productivity. It is for this reason that the Association plans to roll out massive training and sensitization on productivity and strategic management. We are also championing self regulation as a mechanism for enhancing efficiency and productivity.

The Self regulatory vehicle load control charter - signed in October - also supports the attainment of the Port Charter targets. For a very long time, weighbridges along the Northern Corridor have been considered Non Tariff Barriers. Weighbridges are installed primarily to ensure 100% compliance to vehicle load limits but this model must be balanced with trade facilitation. Successful weighbridge operation and vehicle load compliance must therefore be derived from complimentary initiatives of all concerned cargo interveners. It is in appreciation of this fact that stakeholders have - in the charter - made very practical and sustainable commitments that will support compliance. These obligations must, however, be met with sufficient goodwill if they are to be achieved.

The twin initiatives are already substantially contributing to improvement in performance. There has been a significant reduction in transit time with truckers registering as low as 61.24 hours and 70.5 hours for Malaba and Busia respectively compared to 189 hours and 177 hours previously. The reduction in transit time translates to attendant increase in truck turn around.

However, much more needs to be done to mitigate unnecessary time delays at weighbridges, borders and those attributed to personal reasons.

Lastly, it’s important to jealously safeguard the achievements so far and to work together to deliver on the pending promise of making the Port of Mombasa and the Northern corridor the most preferred port and trade route respectively.

In conclusion, I wish to take this opportunity to send a message of condolense on behalf of KTA, to the family and friends of our industry captain at FESARTA, Mr. Mike Scott.

Willington Kiverenge Acting CEO - KTA The Transporter

The Transporter

ISSUE 25 VOL. 1

Updates KTA BRIEFS Axle Load Charter

Transport and Infrastructure Cabinet Secretary Michael Kamau signs the Self-regulatory vehicle load control charter on behalf of the ministry at Mariakani. The charter binds transporters to adhere to vehicle weight limits.

Catchupwithwhat’sbeenhappeningwithinthetransportandlogisticsindustry around the Eastern Africa region

Having their say

Kenya Transporters Association Limited @KTALtd1 COVER PHOTO

Weigh-in-motion in progress.

HAVE YOUR SAY

If you have any comments about The Transporter Magazine, then please send them to: thetransporter@kta.co.ke or The Transporter Magazine, Sea View Plaza, Mama Ngina Drive. P.O Box 88502-80100 Mombasa.

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ISSUE 25 VOL. 1

SURVEY: KTA Program Officer Steve Ogolla (right) engages a driver in a discussion to get his views on movement of trucks on the Northern Corridor during a survey that was conducted along the corridor (full story in page 8).

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advertise with us Call: Miriam on 0724 227322 or Email: thetransporter@kta.co.ke

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KTA News Charter on vehicle load control

FINALLY LAUNCHED

KTA expresses concerns over taxation of

TRANSIT CARGO

T

he much awaited Self regulatory vehicle load control charter has finally been signed by key cargo interveners. The signing ceremony held in October last year at Mariakani weighbridge and witnessed by the Cabinet Secretary for Transport and Infrastructure among other dignitaries was a culmination of a process that was initiated in January to institutionalize voluntary compliance with vehicle load limits. The Charter follows the passing of the East African Community Vehicle Load Control Bill by the East African Legislative Assembly in may 2013.

The East African legislation is intended to harmonize vehicle load control, enhance compliance and mitigate delays witnessed at weighbridges. Kenya is currently witnessing increased cargo volumes and heavy vehicle traffic as a result of reforms and infrastructural improvements initiated at the Port of Mombasa.

According to the Charter signatories, Kenya transporters are now set to be the most compliant in the region in terms of axle and gross vehicle weights. The signatories are rolling out elaborate strategies to promote voluntary compliances through a set of deliverables within the next two years.

“We must be proud of this achievement having set the benchmark on vehicle load management for other EAC member states. But most importantly, the level of inter-agency and private sector cooperation exhibited during the entire exercise has created an atmosphere for the successful implementation of the charter,” stated the KTA Chairman Paul Maiyo, who is also the chair of the charter drafting committee.

The 13 signatories comprising transporters, shippers, clearing agents, roads authority, police, revenue authority have committed to deliverables ranging from; improving weighbridge operations; sensitizing truckers, drivers and shippers on compliance among others.

The road transport is the most dominant mode of transportation in Kenya and the rest of EAC with over 95% of the export and import trade in Kenya being delivered by trucks.

The trucking industry also provides over 50,000 jobs for Kenyans as managers, drivers, mechanics and others.

It has been established that with overloading, the long term incremental direct and indirect costs that enterprises incurr in generating the incremental revenue and the potential high risks are unsustainable.

CONNECT

Contact the editor

thetransporter@kta.co.ke

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ISSUE 25 VOL. 1

Transporters have raised alarm over taxes being imposed on transit goods services, saying they might result to high transport costs within the country and render them uncompetitive in the region.

According to the Finance Act 2014 which came into effect in September this year, services related to transit goods are exempted from tax instead of being zero rated. According to industry players, this is likely to have ripple effect since input taxes paid on services cannot be recovered.

The Kenya Transporters Association (KTA) has written a protest letter to KRA, and wants the taxman to correct the anomaly. According to the association acting chief executive officer Mr Wellington Kiverenge, the irrecoverable tax of about 11 per cent will be passed to the consumer, resulting to increased transport costs and high commodity prices.

“This will also mean that we are disadvantaged in the region since in Tanzania where such services are zero rated, transporters are able to claim taxes. In a business that does not have huge margins like transport, this move will impact negatively and result to losses,” he said in the letter.

He expressed fear that should the rule be implemented the way it is, there was danger of Kenyan transporters being kicked out of business.

“Suppliers are likely to seek services from companies in Uganda and Tanzania or some transporters might shift base to neighbouring countries which will have serious implications to Kenya’s economy,” he added.

The VAT on transit goods services has in the past sparked controversy and when it was introduced in September last year, the taxman backtracked after transporters protested. Since then, truckers have been operating on the basis of zero rated services, until last month.

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ISSUE 25 VOL. 1

Briefs AT A GLANCE

Govt to partner private sector in establishing vehicle inspection centres

Dockers want KPA to boost transshipment cargo operations

T

he Dock Workers Union (DWU) wants the second container terminal currently under construction, dedicated to transshipment cargo to increase cargo thoughput at the port of Mombasa.

According to the union, Mombasa has the capacity to become a transshipment hub, positioning the port on the global map, which it said would subsequently greatly contribute to the country’s economy.

DWU secretary-general Simon Sang said the move would also position Mombasa as a transport hub in the region connecting it to other ports and destinations.

Transshipment involves the shipment of goods or containers to an intermediate destination before being delivered to the final destination.

It allows the change of the means of transport during the journey such as from ship to road transport or to another vessel. It also allows consolidation and deconsolidation of shipments.

Last year, transshipment cargo traffic at the port of Mombasa recorded a robust performance posting 621,000 tonnes up from slightly above 100,374 tonness handled in 2013.

According to the Kenya Ports Authority management, transshipment cargo posted a 309.2 per cent growth, contributing to the one million container throughput realised by the port of Mombasa last year.

It was the first time the port of Mombasa handled one million twenty foot equivalent units (TEU’s) and 24 million tonnes of total cargo throughput in a year.

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“Transshipment traffic is a key segment of cargo traffic that any port would strive to capture given the fewer logistical challenges involved. It is a business everyone is looking forward to. I am surprised as a port we have not started doing that,” said Sang.

“We want to ask that the second container terminal be dedicated to transshipment business. This could see Mombasa port even handle 1.5 million tonnes per year,” he added.

He dismissed concerns by the Kenya Revenue Authority that transshipment business is likely to have the transit cargo consumed in the country.

“This is not true because the cargo remains in the port until it is shipped to the final destination. It does not go to the container freight stations,” said Sang.

The construction of the three phase container terminal at the port with a capacity of 1.2 million TEU’s is ongoing.

The first phase with a capacity of 450,000 TEU’s is 62.2 per cent complete and is expected to be ready by 2016.

According to KPA, plans are underway to begin the second phase early this year.

Late last year, Transport Cabinet secretary Michael Kamau announced work on the second container terminal could even be completed earlier than scheduled.

He said his ministry would discuss with other relevant ministries on how to realise transshipment business in the country.

“We will discuss with the finance ministry to address any hitches and find a way of taking transshipment to another level,” said Kamau.

The Tanzanian government has said it will join hands with the private sector to ensure that modern Vehicle Inspection Centres(VIC) are established countrywide so as to check road safety.

The country needs about 500 vehicle inspection centres countrywide so as to conduct checks that include brakes, steering, suspension, emission transmissions, electrical systems and assessment of general condition of the vehicles aimed at ensuring safety of road users.

Speaking in interview with reporters when visiting the National Institute of Transport (NIT)’s newly established Vehicle Inspection Centre, Deputy Minister for Industry and Trade Janeth Mbene said that after the launch of the NIT’s vehicle inspection centre, the government will look forward to partner the private sector to have more centres all over the country.

Mbene urged government institutions, parastatals, private sector and individuals to make use of the vehicle inspection centre to test their vehicles for road worthiness.

She also called the institute to work with other public institutions such as Tanzania Electrical, Mechanical and Electronics Services Agency (TEMESA) and the Road Traffic Department in the Police Force to carry out regular inspections on vehicles.

The Transporter

Off Refinery Road, Changamwe. P.O. Box 80038 - 80100 Mombasa, Kenya The Transporter

ISSUE 25 VOL. 1

Tel: (+254) 20 8087305, 786 181025, 718 868977 Email: info@volcan.co.ke

7

Briefs KTA participates in the NORTHERN CORRIDOR SURVEY

A

team of key Northern Corridor public and private sectors stakeholders has completed a 12 day long survey of the Northern Corridor transit section between Mombasa and Kampala.

The Northern Corridor encompasses the transport infrastructure and equipment served by the Port of Mombasa and used by the traffic to and from the territories of the contracting parties namely Kenya, Uganda, Burundi, Rwanda, DRC and now South Sudan and other neighboring states. The Northern Corridor Co-ordination Authority, established under the Article 6 of the Nothern Corridor Transit and Transport Agreement (NCTTA) and comprising the Council of Ministers, the Executive Committee, the Specialised Committees, Public Private Partnership Committee and the Permanent Secretariat, is tasked with among others; exercising jurisdiction over the co-ordination and implementation of the corridor activities which include transforming the Corridor into a Development Corridor which, in addition to offering safe, fast and competitive transport and transit services that secure regional trade, stimulates investment, encourages sustainable development and poverty reduction.

The corridor surveys form part of the on-going efforts by the regional governments to make the Northern Corridor efficient and affordable so as to attract business to the region.

Poor infrastructure and lengthy port and border processes have been identified as the foremost non-tarrif barriers to trade in East Africa. The survey was organised by the Permanent Secretariat of the Northern Corridor to identify and address the challenges faced by the users and operators along the Northern Corridor routes considered to be among the most expensive trade routes in Africa. The survey delegation led by Mr. Emile Sinzumusi, Head of Programme for Customs and Trade Facilitation at the Northern Corridor secretariat, visited Mombasa Port, Changamwe

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railway station, Container Freight Station, weighbridges, Eldoret pipeline and railway station, Cargo interveners at either sides of Malaba border and URA Transit Monitoring Unit in Kampala.

Among some of the key challenges identified during the survey include inadequate cargo off-take and delivery infrastructure within the precincts of the port, poor infrastructure and inadequate staff at Malaba border post, poor state of Athi river and Gilgil weighbridges and inadequate acceleration lane at the Webuye High Speed Weigh In Motion scale, extortion at highway police checks, traffic jams and overloading.

A visit at the Malaba Customs offices revealed lack of a holding yard, a warehouse and a scanner for verification. The KRA officers decried the delays occassioned by the on-going construction work of the One Stop Border Post (OSBP) which have pushed them to undertake the verification exercise on the Ugandan side of the Border.

“Transit truckers have had to contend with delays at the border due to operational inefficiencies largely caused by the on-going construction of the Malaba OSBP and inadequate staffing at the customs office,” said a KRA officer.

The OSBPs are meant to reduce the number of stops in cross border trade and other transactions by combining border controls activities of the agencies at a single location in each direction. The construction of Malaba (Kenya) OSBP is still ongoing contrary to earlier indication that the work was due for completion early 2014.

Lack of system integration and frequent system downtime was also identified a major cause of delays at the border. The clearing agents also complained that drivers were wasting a lot of time at the border for personal reasons, contributing to delay in cargo delivery and increase in operating costs.

Implementation of the survey report recommendations will be carried out by the regional governments through the Northern Corridor Secretariat.

TRANSITION

Industry losses a

CHAMPION

Mike passed away recently, at the good age of 75.

This milestone cannot be allowed to pass without FESARTA paying tribute to one of its most ardent supporters, since it was formed in 1993.That he chaired FESARTA for more than 8 years, gives testimony to his support for the regional association. But, it was not just his occupying the chairmanship that we remember him for. He openly and publicly voiced his support whenever the opportunity arose. Whether at a regional conference, or at a high-level meeting with overseas dignitaries, his message was always the same, regardless of who was listening – give support to FESARTA. He always wanted action. He was tired of hearing the same old problems over and over again. Of course, he knew all the problems, right down to the last detail. Nobody was better equipped for this, because he wasn’t just a very senior person in Cargo Carriers, one of the largest and most respected transport companies, but he was also “hands-on”. He travelled extensively and picked up details from drivers, customs agencies, transporters, financiers and anyone else who was prepared to give information.

His knowledge of African countries is well known and probably unsurpassed.

He fraternized with many leaders of these countries and was always up-to-date with the latest political happenings. Of course, he read avidly about African affairs and international finances. He knew why a country was going through difficult times and could link the economy with its financial position. Even potential investors would seek out his input on where and how to invest.

We will all miss Mike very much. For his outspoken approach, his knowledge, his desire to help and his seemingly endless energy.

You are now at peace, Mike, though I’m sure the trucking industry is still somehow with you!

The Transporter

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ISSUE 25 VOL. 1

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in bits...

Fewer Kenyans died on the road in 2014 Transport Principal Secretary Nduva Muli has sent condolences to families and friends of Kenyans killed in road accidents during this festive season. The PS, however, urged road users to be more vigilant and adhere to road safety measures enforced by National Transport and Safety Authority and the police.

While releasing accident statistics yesterday, the PS noted a decline in the number of accident deaths reported in December. This December there were 206 fatal accident victims compared to last year’s 265. Nduva said 2,843 Kenyans had died since January compared to 3,179 by the end of last year.

Another 4,933 suffered serious injuries compared to 6,086 last year. Some 3,752 others got minor injuries in accidents compared to 4,691 in the same period last year. He said the Ministry of Transport would build more capacity within NTSA to step up road safety initiatives.

New inspection sticker unveiled There will no longer be any tolerance for unroadworthy vehicles after the Government unveiled a new car registration sticker meant to rid them from Kenyan roads.

Transport Cabinet Secretary Michael Kamau and National Transport and Safety Authority (NTSA) officials said the new stickers have a bar code with numbers to help police determine mechanically sound vehicles.

“Our new stickers have a bar code with an ISDN number that police can use to determine where the vehicle was inspected. Traffic police can dial the number 22486 together with the vehicle’s registration number and immediately find out where the vehicle was last inspected, proving whether it is roadworthy or not,” explained Mr Kamau.

Sh90 million per kilometre too costly Kenya desperately needs roads but spends too much-Sh90 million per kilometer, Transport Principal Secretary John Mosonik has said.

“We need to reduce the cost to between Sh20 million and Sh50 million,” he said at ministry headquarters.

The ministry is grappling with budgetary constraints and a high cost of infrastructure.

Mosonik cited a huge backlog of development and maintenance and foreign currency fluctuations as other challenges.

The government allocates Sh43 billion for roads construction annually.

Kenya has a road network of 161,000km worth about Sh2.5 trillion, Mosonik said.

Sh900 million project to de-congest city

The Ministry of Transport and Infrastructure will soon kick off a Sh900 million road project to decongest Nairobi.

Infrastructure Principal Secretary John Mosonik said tenders had been awarded to five contractors who are expected to complete the project within eight months.

“The issue of decongestion in the city is something that has been a public outcry for quite some time now. So last week we awarded a tender of up to Sh900 million which is to start soon once we have officially signed the contracts,” he said.

The PS said the project will mainly focus on construction of decelerating and accelerating lanes in about 60 road junctions within Nairobi.

Police to impound unauthorised plates Kenya’s Cabinet Secretary for Transport and Infrastructure Michael Kamau has asked police to impound vehicles with unauthorised number plates.

The move comes as part of increased security measures across the country.

“The use of these unauthorised number plates is not only illegal but compromises national security,” Kamau said.

“The Ministry of Transport and Infrastructure has therefore advised the National Police Service to impound any vehicle on a public road with unprescribed number plates and arraign before court the owners and drivers of such vehicles.”

Drivers who wish to use personalised number plates must apply to the National Transport and Safety Authority or risk a fine of up to 500,000 shillings ($5,500) and a potential jail term of up to five years, Kamau said.

Oil firm targets 250,000 motorists in safety campaign National Oil Corporation has embarked on a drive seeking to rope in 250,000 motorists this year in a road safety campaign aimed at reducing road carnage in the country. The campaign will see motorists who fuel at National Oil petrol stations taken through flash road safety awareness campaigns, aimed at sensitising them on various road safety measures. Speaking at the launch of the event, Transport and Infrastructure Cabinet Secretary Michael Kamau said thousands of Kenyans lose their lives each year owing to road carnage, adding that the Government was committed to cut back these grim statistics. “Kenya, like many other developing countries, has endured economic losses amounting to up to five per cent of the gross domestic product annually, besides the immeasurable loss arising from the loss of 3,000 lives annually, most of who are young people in their prime age,” he said.

The number of fatalities from road accidents in the country last year fell by 9.7 per cent, falling below the 3,000 mark for the first time in 10 years. The Government attributes the reduced number of casualties to several initiatives like mobile traffic courts operated throughout the county, the anti-drunk driving campaigns and the introduction of speed limits in urban centers and major highways.

“Our experience from the interventions last year points to the need for concerted, multi-sectorial approach in tackling the problem,” stated Eng Kamau.

Source: The Standard

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The Transporter

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Customs

VOI-TAVETA ROAD

Delays use of Holili OSBP

T

he ongoing upgrading of the Voi-Taveta road in Kenya is the latest hitch delaying the use of the Holili One Stop Border Post in Moshi, Kilimanjaro, constructed to ease transit goods clearance at the border with Tanzania.

The two countries already signed a bilateral agreement to pave way for the use of the $5.7 million state-of-the-art structure set up by Trademark East Africa at Holili on the Tanzania’s side of the border. Another US$ 6.7 million infrastructure at the Taveta border post on the Kenyan side was on the final touches by late last year.

TradeMark East Africa Director for One Stop Border Posts, Mr Sjoerd Visser told the media recently that the bilateral agreement was signed in July last year but the use of the post has been delayed due to on-going upgrading of Voi-Taveta road to allweather tarmac.

The Kenyan government had signed a US$ 113 million loan

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facility with African Development Bank this year for the construction of the 110 kilometres road which links Kenya and Tanzania through Taveta and Holili border.

Trademark East Africa is providing funding and technical support to facilitate implementation of the integrated border management systems at Holili and Taveta border posts.

The idea is to improve efficiency by reducing the total average time it takes to clear cargo at the two border posts by 30 per cent which will contribute to reducing transport costs and increase intraregional and foreign trade in East Africa.

Under the project activities of both country’s border operations and agencies are combined at either a single common location or at a single location in either direction without increasing risk to public safety or revenue collection.

The two OSBPs are expected to offer an alternative transportation route to northern Tanzania from

Kenya and reduce the time it takes to transport goods to and from Mombasa port.

The Holili post is fitted with all the necessary facilities to be used by all border management authorities. Tanzania and Kenya opted for a bilateral agreement to allow operations of the one stop border post as other options would have required more time.

The two countries were required to have a legal framework that would guide operations of the project, but it was seen it would take long time to implement.

Last year the East African Legislative Assembly (EALA) passed a legislation on the OSBP but the law needed to be assented by the presidents of five member states which will take a long time.

The East African Community (EAC) is developing one stop posts at 15 border crossings in the five partner states to facilitate trade and integration in the region.

The Transporter

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Regional

More NTBs recorded in BAGAMOYO PORT PROJECT

C

onstruction of a Chinesefunded port and special economic zone in Tanzania worth at least $10 billion will start in July this year, the President’s office said in a recent statement.

Tanzania aims to build a huge port at Bagamoyo, 75 km (47 miles) north of commercial capital Dar es Salaam, the site of the country’s main port, where shippers complain of congestion and inefficiencies.

A construction agreement for the port and associated zone was signed last year and follows a framework deal signed in 2013.

An official said a start date for building work had taken time to set because of other negotiations about infrastructure to link the port to national transport networks.

The planned Bagamoyo port, new investment in Dar es Salaam and other spending on roads and railways are part of Tanzania‘s efforts to become a transport hub that could challenge the dominance of Mombasa in neighbouring Kenya.

“The Tanzanian government signed a memorandum of understanding with two major international institutions … to develop the Bagamoyo economic zone,” Tanzania‘s presidency said in the statement.

Tanzania signed the infrastructure development agreement with port developer China Merchant Holding International (CMHI) and Oman’s biggest sovereign wealth fund, the State General Reserve Fund (SGRF). President Jakaya

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Kikwete witnessed the signing of the agreement in Shenzhen, southern China.

A framework agreement between Tanzania and the Chinese port operator was signed when Chinese President Xi Jinping’s visited the country in March 2013.

Li Jianhong, executive chairman of China Merchants Holdings, asked Tanzania‘s government at the signing of the construction contract to remove obstacles that have delayed implementation.

“We will do everything possible to ensure that this project takes off because it will bring enormous economic benefits to the entire country,” President Kikwete said in the statement.

It is billed as the biggest port in Africa once complete, and will handle 20 times more cargo than Dar es Salaam port, which is currently Tanzania’s largest port.

The port is expected to facilitate trade in the region by acting as a hub for raw materials coming in and out of neighbouring landlocked countries, as well as bringing Chinese manufactured goods into the region China will also help in connecting the port to existing transport networks by upgrading and establishing new roads and railways.

In March 2008 the Tanzania Ports Authority (TPA) hired consultants to prepare an outline for the development of both coastal and lake ports in Tanzania. The consultants produced a final report in February 2010 which was adopted as a blue print for port development in the

country.

According to the consultants’ report, Dar es Salaam port provides sufficient capacity to handle expected traffic up to 2016 in the high forecast case, and 2020 in the low forecast case. After that, a completely new area will have to be opened up for port development. It recommended the construction of a port at Bagamoyo to remedy this.

A large scale development of container and vehicle facilities at Bagamoyo, combined with smaller scale dry bulk and multi-purpose terminals at Mwambani Bay was agreed on by the Tanzania Ports Authority.

While briefing the Mayor of Valejo, California in the United States, the Director of Mobilization and Services at the Export Processing Zone Authority, Zawadia Nanyaro, said the government has set aside more than 22,000 acres as a special area for investment – the Economic Development Zone – in Bagamoyo.

Zawadia said a modern port and international airport to serve the industrial city will be built.

Some members of the opposition in Parliament have however questioned the award of the Bagamoyo Port development to China, saying Parliament was not informed about the deal.

They are also against the lease reportedly granted to China to operate the port for forty years, and also argue that the cost involved is too high compared to similar projects elsewhere.

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Taking Over East Africa

Off Enterprise Road, Road B, P.O. Box 1314-00606 Nairobi. Tel: 020-2306677, 0706 277377, ISSUE 25 VOL. 1 15 The Transporter 0735 277377, 0717 176578.

Email: info@loadtrailers.co.ke •www.loadtrailers.co.ke

Regional

EAC infrastructure investment

BLUEPRINT ENDORSED

A

proposed 10year investment strategy for priority infrastructure projects in the East Africa Community to tackle existing gaps received backing during the just-concluded EAC Heads of State Retreat on infrastructure development and financing.

The summit, held in Nairobi, Kenya towards the end of last year endorsed the blueprint and directed the Council of Ministers to mobilize resources for implementation.

Held under the theme, Supporting the implementation of the Common Market through the development of efficient infrastructure networks and intermodal transport systems in

the EAC, the summit was chaired

by Kenyan Deputy President William Ruto.

The infrastructure projects which include railway, energy, ports and harbours and information and communications technology among others, are expected to cost at least $100 billion, according to a communiquĂŠ from the EAC Secretariat.

The endorsement comes at a time when the region is in negotiations with development partners, including the World Bank, the African Development Bank, European Investment Bank as well as individual countries, particularly China and India, in efforts to raise the required resources.

At the retreat, several

development partners pledged to support specific infrastructure projects. World Bank pledged $1.2 billion toward infrastructure development and improved competitiveness of EAC region, while Trademark East Africa pledged $350 million to support regional infrastructure for ports, one stop border posts and road connectivity.

The summit further called for the fast-tracking of the development of regional capacities to support the implementation of priority infrastructure projects and programmes. “The summit directed the Council to engage bilateral and multilateral cooperating partners to mobilize technical and financial support for project

EARMARKED FOR INVESTMENT Infrastructure projects which

include railway, energy, ports and harbours and information and communications technology among others, are expected to cost at least

$100 billion

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preparation and implementation,” the statement, released after the summit reads in part.

The Council was also urged to hold annual briefing roundtable for infrastructure investors and financiers focusing on mobilizing the requisite resources over the next 10 years for the implementation of the priority infrastructure projects and programmes and also highlight investment opportunities.

The summit also called for the consideration of the establishment of regional centres of excellence for infrastructure and transport skills development in order to enhance regional capacities in roads, railways, ports, oil and gas, power generation and transmission and contract negotiations and management.

During the December Summit, the presidents of Kenya, Rwanda and Uganda said they were satisfied with progress of major regional infrastructure projects geared at enhancing integration.

The projects include the development of a new port in Lamu, crude oil pipeline to link South Sudan, Kenya and Uganda; a new oil refinery in Uganda, a power transmission line cutting across Kenya, Uganda and Rwanda, a new road and standard gauge railway network; creation of a single customs territory and a one area network for mobile phone services.

“A lot of progress has been made on these projects. Now we need to focus our minds on mobilizing resources to kick start them,” President Uhuru Kenyatta said. The president of South Sudan Salva Kirr was represented by the vice president while Tanzania, Burundi and Ethiopia participated in the summit as observers.

A communique released afterward noted that the four countries had renewed their commitment to fast track the implementation of the infrastructure projects for transforming the Northern corridor.

The heads of state directed ministers of finance, infrastructure and Attorneys General to expedite ratification of the standard gauge railway protocol and to jointly mobilize financing for Northern corridor integration projects and report to the next summit. The next summit will be held in Kigali, Rwanda in February this year.

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China agrees to boost infrastructure investment in Kenya China and Kenya have agreed to extend their ‘industrialisation partnership’ with a new focus on technology transfer and more Chinese involvement in infrastructure development.

The agreement came as China’s foreign minister Wang Yi visited Kenya’s capital Nairobi as part of a tour of African nations aimed at bolstering commercial ties with the region.

Wang said his mission was “to strengthen the existing bilateral co-operations between Kenya and China and chart new areas that the two countries can partner in”.

President Uhuru Kenyatta, on his part, called on China to support efforts to open the East African region.

“We need you to work with us to link the Eastern Africa region by extending the railway to our neighbouring countries including Uganda, South Sudan, Rwanda, Burundi and even the Democratic Republic of Congo to open up the regional economy,” Kenyatta said.

According to Wang, agricultural modernisation and infrastructure development will be among key areas for partnership, Wang said. “The two countries will also partner in mineral exploitation

and environmental conservation.”

“Industrial relocation was how China took off and Kenya can benefit from it,” Wang said.

“China stands ready to share its experiences on industrial zoning and special economic zones and we are ready for more cooperation in these fields.”

Infrastructure investment expert Akshai Fofaria of Pinsent Masons, the law firm behind Out-Law.com, said: “This is yet another savvy example of China getting in at ground level in the industrialisation of Africa.

However, the jury is still out on whether the Chinese model of special economic zones (SEZs) will work in Africa.”

Fofaria said: “If such SEZs are to make a lasting impact, they need to draw a critical mass of both Chinese and domestic investors, allow for linkages with the domestic economy and stimulate activities higher up the value chain. This means that the companies operating in the zone cannot be largely subsidiaries of the developers. Ancillary services also need to be sourced locally rather than from abroad and big ticket investments with an enduring technological element need to be encouraged.”

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Regional Fund to help reduce

EAC FREIGHT COSTS A USD16 million fund has been set aside for innovators who can come up with effective strategies to cut costs on transport and logistics in East Africa.

The competition, dubbed Logistics Innovation for Trade (LIFT), will provide grants ranging from $200,000 to $750, 000 to winning proposals from innovators from across the world but whose ideas will be implemented in East Africa.

LIFT is managed by TradeMark East Africa (TMEA) Challenge Fund with funding support from UK-DFID; and seeks to trigger and introduce innovative approaches to tackling freight and transport costs in East Africa region.

East Africa is reported to have the highest freight and transport costs in the world; over 50 per cent higher than the USA and Europe per kilometre. Indeed, transport costs for land locked countries in the region can be as high as 75 per cent of the value of exports.

Transit times have the most significant effect on exports and also result in firms having to carry higher levels of stocks making them less efficient.

Successful LIFT project applicants will contribute to TradeMark East Africa (TMEA) objective of reducing transport time along the main East Africa transport corridors by 15 per cent by 2016.

Speaking at the opening event, TMEA Senior Director, Business Competitiveness Lisa Karanja said, “Our desire is to see East Africa adopt world class logistical technologies so that it ably competes with the rest of the world.”

LIFT is a challenge to the private sector to develop and test new ideas that could reduce the cost and time of transport and

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logistics. Through the fund, TMEA will co-invest with the private sector in projects that have the potential to achieve this but may be too risky to undertake without external support.

She added, “We’re calling on the world’s brightest minds to tackle East Africa’s toughest challenge in trade: Transport and Logistics. In the last few years, TradeMark East Africa through its Challenge funds has rallied innovators, entrepreneurs, private businesses and IT geeks to tackle some of East Africa’s toughest trade problems. Today, East Africa is in dire need of new ideas and bold solutions to tackle its high transport and logistics cost.”

TradeMark East Africa Challenge Fund manager, Mr. Isaac Njoroge said, the Challenge fund comes in to help private businesses and innovators mitigate risks of high return projects that are risky and have not been tested.

“The fund is open to businesses and individuals throughout the world that are operating or will operate in EAC. Businesses in the transport and logistics industry and those who provide services to it are hereby invited to submit the most innovative ideas to LIFT,” he said.

Noting the contribution of Challenge funds in providing solutions, Njoroge added that transit times are an important determinant of trade and the competitiveness of firms. A reduction of one day in transit times leads to 7 per cent increase in export. Reduced cost and time of transport would increase trade, reduce cost of living and contribute to

higher exports and faster growth to create jobs.

Since its inception in 2012, TMEAChallenge Fund is supporting other Trade innovations worth US$ 10 million. Some of resulting innovations include: the recently launched Airtel Cross Border money transfer and the Africado Ltd project “Developing Export Markets for Avocado in Kilimanjaro Region.

The Airtel cross-border money transfer pilot phase rolled out in November 2014 with first phase targeting Kenya, Uganda and Rwanda. Africado Limited, on the other hand, invested in capacity-building activities for avocado farmers which involved construction of a cold chain export facility using new technology which ensured packaging and preservation was optimized.

This has led to less rejects on products exported to the European market, thus increasing returns to farmers. In addition to its original farmers, Africado was able to build the capacity of an additional 2,000 farmers, who now grow export ready avocados, firmly placing them on a path towards prosperity.

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Advertiser’s Feature

NORTHERN CORRIDOR: A promising efficient and smart economic corridor The establishment of a secure, reliable and efficient transit and transport system remains critical for transiting and landlocked developing countries in general, and for Northern Corridor Member States in particular, to be able to reduce transport costs and enhance the competitiveness of their exports to regional and global markets.

“High transport and trade transaction costs of imports and exports for Northern Corridor Member States are partly attributed to the existence of inefficiencies translating in uncertainty and Non-Tariffs Barriers (NTBs)”, reveals Donat M. Bagula, Executive Secretary of the Northern Corridor Transit and Transport Coordination Authority (NCTTCA), “thus the elimination of NTBs remains an urgent priority for all stakeholders along the Northern Corridor region”.

“Currently, assures Bagula, some of them are now part of history thanks to high level commitments and concerted efforts to reduce the NTBs in order to facilitate trade along the Northern Corridor”.

Since June 2013, Heads of State

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in Northern Corridor Member States embarked on speeding the Infrastructure projects along the Northern Corridor region through what was dubbed as Northern Corridor Integration Projects Summit to provide direction on deepening regional integration projects.

The Government of Kenya has also rolled out a raft of measures aimed at smoothening transport and facilitating trade along the Northern Corridor region. Those measures to reduce NTBs include but not limited to fitting the High Speed Weigh in Motion (HSWIM) at weighbridges to reduce the delays and fight corruption. The HSWIM are so far fitted at Mariakani, Mlolongo, Gilgil and Webuye weighbridges.

Northern Corridor Performance indicators The Northern Corridor Transit and Transport Coordination Authority (NCTTCA), implementing the overall directives of the Northern Corridor Member States and with the support of different partners, has already established a dedicated

systems of monitoring NTBs at the Port of Mombasa, weighbridges, en route and border posts dubbed as Transport Observatory and Northern Corridor Performance Dashboard.

In December 2012, the NCTTCA, with the support of Trade Mark East Africa (TMEA) and partnership with the Kenya Transporters Association (KTA), launched the Transport Observatory Project (TOP), an evidence-based online platform capable of monitoring, measuring and tracking up to 25 key performance indicators related to volume and capacity, transit time and delays, rates and costs, efficiency and productivity in the region.

“Since then, the Northern Corridor Transport observatory has achieved tremendous improvements in monitoring key corridor indicators and had continued advising the Decision makers, regulators and users in order to improve the performance of the Corridor”, declares Donat M. Bagula, Executive Secretary of NCTTCA. In 2014, the Observatory has been enhanced and is now tracking thirty one (31) performance indicators.

Nine (09) of these indicators are tracked on a weekly basis and the results posted on the Northern Corridor Performance Dashboard (www.kandalakaskazini.go.ke).

The Mombasa Port Community meetings held every Friday at the port of Mombasa provides a forum to discuss and validate the results.

The NCTTCA has initiated the process of incorporating a GIS component to the Transport Observatory and the work will be complete in the third quarter of the financial year.

Through the northern corridor observatory, various stakeholders and policy organs have identified areas that need improvement and initiated projects and initiatives to address challenges.

Other improvements can be evidenced from the following highlighted indicators generated from the Transport Observatory and Corridor Performance Dashboard.

Cargo Dwell Time at the Port of Mombasa Dwell time is the measure of the time that elapsed from the time the cargo arrives in the Port to the time the goods leave the port premises after all permits and clearances have been obtained.

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From the figure below, the average time taken by a container at the Port of Mombasa has been improving since 2009 as shown by the trend line. The figure shows that dwell time has dropped by 78.5% from 242 hours (more than 10 days) in January 2009 to 52 hours (2.16 days) in August 2014, the lowest dwell time ever registered. This is considered a big improvement from the baseline of 105 hours (4.3 days) and the drawn target container dwell time of 72 hours (3 days).

It is worthy also to mention that, in 2013, the Port of Mombasa handled a total of 22.3 million tonnes of general cargo up from about 21.9 million tonnes in 2012, registering a growth of 1.8 per cent.

Transit Time within the Port after Customs Release This time is arrived at by taking cargo removal time at the gate from port minus release order time. The figure below shows a decreasing trend on transit time after customs release at the Port of Mombasa.

Sometimes it takes on average between 40 and 90 hours for transporters to pick cargo after customs release which is still considered too high compared to the 24 hours benchmark.

However, the baseline for picking cargo by transporters should be 42 hours as an acceptable norm.

Traders and transporters are therefore encouraged to actively cooperate with other stakeholders and spearhead the process of evacuating their cargo from the port area as fast as possible in an efficient manner once they have been cleared by the customs.

The trend line shows that transit time after customs release will continue to decrease in the long run. One of the mechanisms to reduce this time wastage is to clear truck drivers while inside the truck to ease congestion in the waiting area.

Transit Time within the Corridor The case of Rwanda: With the improved custom clearances at the port and within the transit routes, it is expected that transit time in Rwanda will continue to decline in the near future.

The figure below shows transit time in Rwanda. The indicator is measured by the difference between date and time when cargo exit and enter the border.

The time node covers the distance between Akanyaru-Haut (AH) on the Burundian side and Gatuna The Transporter

Average Cargo Dwell Time in Mombasa Kenya

SOURCE: KPA, JAN 2009-AUG 2014

Transit Time Within the Port after Customs Release

SOURCE: KPA, JAN 2009-AUG 2014

Average Transit Time in Rwanda

SOURCE: RRA, JAN 2013 -JUL 2014

(GA) from the Ugandan border.

The figure demonstrates that on average it takes 26.8 hours and 44.9 hours to transport a 20’ TEU container from Gatuna to Akanyaru Haut and vice versa respectively.

Weighbridge Compliance Axle load compliance and Gross weight compliance for weighed trucks passing through Mariakani and Athi-River gradually increased during the period of July to midSeptember 2014.

Mariakani weighbridge

compliance showed a consistent improvement though still below the set benchmark of 90% and the target of 100% level while Athi-River has a remarkable improvement recording the highest compliance level of 95% in the second week of September 2014.

According to Donat M. Bagula, the Executive Secretary of NCTTCA, “implementation of high-speed weigh in motion has definitely had an impact in ensuring effective risk management on implementing axle Contd. in page 41 ISSUE 25 VOL. 1

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Cover Story

Weigh-in-motion

REVOLUTION “Overloading kills roads, so does uneven distribution of the load along axles. If you lie down and I stand on you, you’ll feel the weight of my 100 kgs. But if I put on high-heeled shoes and stand on you, you’ll feel excruciating pain. That’s what axle overloading does to roads.” – Albert Stockell, Managing Director of SGS Kenya.

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The Transporter

K

enya’s trucking industry entered the fast lane in October last year with the official commissioning of High Speed Weighing in Motion (HSWIM) Weighbridge at the Mariakani Weighbridge station, during a ceremony officiated by Cabinet Secretary (CS) for Transport and Infrastructure Mr Michael Kamau.

Mariakani weighbridge is 35km (20 miles) northwest of Mombasa, and the first along the Northern Corridor that serves more than 3,000 trucks ferrying goods from Mombasa port to various destinations in Kenya and its East African Community (EAC) neighbours.

The other sites where the HSWIMS have been installed are Athi River, Gilgil and Webuye. This new weighbridge technology is expected to speed up freight, save taxpayers millions in road repairs and reduce the opportunities for parasitic corruption.

“This is the start of a new era for road freight,” says Albert Stockell, Managing Director of SGS Kenya, which imported and installed among other high-tech equipment, High Speed Weighing in Motion (HSWIM) system including number plate recognition (NPR) cameras for automatic vehicle identification, traffic control systems, and multideck scales among other systems and equipment for the Kenya National Highways Authority (KENHA).

“The HSWIMs should stop the truck overloading that wrecks the roads yet expedite movement of compliant trucks through the weighbridges by screening the trucks on the highway and allowing conforming trucks to proceed with their journeys without diverting to the weighbridge station. This will save the taxpayers’ money, make the highways safer, and ultimately, reduce ingrained corruption and help cut the cost of goods for consumers.” In addition, SGS and KENHA are upgrading five other locations – Mtwapa, Isinya, Juja, Busia and Rongo – as part of a drive to modernise transport with automation, camera technology and other innovations to stamp out the corruption that preys on trucking.

Altogether SGS is bringing world class

The Transporter

weighbridge technology to 11 sites including electronic “loops and loggers” that will be used to count vehicles, standard and infrared cameras for taking photos at night, Automatic Number Plate Recognition software, CCTV, traffic lights, signals and booms to automate the weighing of trucks and eliminate the human element.

Another innovation is six mobile weighbridges that will stop and weigh trucks between weighbridge stations to stamp out the growing practice of “lighters,” – pickups and other small vehicles, which offload overweight trucks between weighbridges for a fee and then help reload them once the truck has cleared the weighing station. The mobile scales will also take care of the road network not served by the 11 weighbridges.

The target of this multi-million dollar operation is overloading of trucks, either accidental or, more often, deliberate, that wrecks highways. Overloaded trucks not only destroy the road infrastructure, but pose a road safety threat to the general public.

The steering and braking mechanisms of overloaded trucks do not functioning as designed and can cause the vehicle to run out of control.

“Overloading kills roads. So does uneven distribution of the load along axles. If I ask you to lie down and then stand on you, you’ll feel the weight of my 100 kg on your chest.

But if I then put on high-heeled shoes and stand on you, you’ll feel something altogether different, excruciating pain. That’s what axle overloading does to roads,” says Stockell.

The HSWIMs are a revolution in Kenya and a key technology to modernise transport practices under a privatisation drive. There is a 5 per cent tolerance limit built into the weighbridge system, but only on axle overloading. Overloaders are asked to unload excess freight, redistribute it if axle weight is the problem, or face court, and fines.

Transport operators overloaded on the gross vehicle weight (GVW) are prosecuted, fined

ISSUE 25 VOL. 1

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Cover Story

“The law makes provisions forthe control of vehicle loads, and establishes a framework for the protection of the regional road network.”

and have to shed the excess weight before being allowed to proceed with their journey.

Until now every truck had to be weighed to prevent overloading or dangerous distribution of their loads, causing delays and long queues and creating opportunities for the operators, police and middlemen to circumvent load restrictions through bribery.

This is no more. The beauty of the HSWIM system is that trucks are weighed as they cruise the highways, and only those suspected of overloading or bad distribution will be filtered off and checked at the four weighbridge locations between Mombasa and the Ugandan border – Mariakani, Athi River, Gilgil and Webuye along the Northern Corridor.

In 2001, when 24 HSWIMs

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were introduced on South Africa’s lifeline truck routes, 38 per cent of the trucks were found to be overloaded.

Twelve years later, that has fallen to less than 3 per cent.

“Africa doesn’t need more weighbridges. It just needs more efficient ones, and WIMs are the way of the future,” says Stockell.

“The HSWIM system rewards truckers who don’t overload by letting them sail past and stops those suspected of carrying more freight than legally allowed by having them pull over for weighing or even be instructed to redistribute their loads more evenly.”

Axle load is critical to preserving highways and taxpayers’ money. Badly distributed loads cause the rutting seen on Kenya’s

highways. In one recent case, a truck was found to be carrying 158 tonnes against the statutory and EAC-wide limit of 52 tonnes. This can’t be allowed to happen.

“Overloading is deliberately done. It’s not an accident. So we have to be deliberate and systematic in eradicating it to save our roads and to get the industry to understand that there is no alternative but to abide by the rules and laws,” says Muita Ngatia, Axle Load Manager at KENHA. But what do the truckers and truck owners think? Few would give their names to their opinions for this article but only a few were supportive of the WIM revolution or the current weighbridge system.

“I got weighed at Mariakani and it was fine,” says one trucker on The Transporter

Overloading is deliberately done. It’s not an accident. So we have to be deliberate and systematic in eradicating it to save our roads and to get the industry to understand that there is no alternative but to abide by the rules and laws.

Muita Ngatia, Axle Load Manager, KENHA

WEIGH IN MOTION EXPLAINED Weigh-in-motion or weighing in motion (WIM) devices are designed to capture and record axle weights and gross vehicle weights as vehicles drive over a measurement site. Unlike static scales, WIM systems are capable of measuring vehicles traveling at a reduced or normal traffic speed and do not require the vehicle to come to a stop. This makes the weighing process more efficient, and, in the case of commercial vehicles, allows for trucks under the weight limit to bypass static scales or inspection.

Especially for trucks gross vehicle and axle weight monitoring is useful in an array of applications including size and weight enforcement, legislation and regulation, and administration and planning.

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his way to Kampala. “But when I get to Athi River I am stopped and told that I am overloaded.

Something is wrong here, and the person who suffers is me, my boss and my clients.”

Fred Nyale, the SGS Manager responsible for this operation says it may be that the truckers’ load shifted during the drive from Mariakani or that his clearance certificate at Mariakani was “bought rather than given”. He acknowledges that corruption, and potential for corruption, is rife.

“At all weighbridges it’s the police who decide what trucks are pulled in for weighing.

Especially at night, for reasons you can correctly guess police let trucks go past (bypass the weighbridges) without weighing and there is not much we can do about it except get clerks to take their registration numbers and keep a log of “transgressors,” says Nyale.

Altogether 70 staff were sacked at Mariakani and Gilgil between 2010 and 2012 for “reasons of integrity” Nyale says, adding that over 100 more have been given marching orders between January 2013 and December 2014. This is a demonstration of strong commitment to eradicating corruption from within their ranks. However, the involvement of the other parties such as the police, brokers and the transporters

and shippers who are the main perpetrators of the vice need to be checked. Truckers have registered their opposition to weighbridges in recent months by queuing outside Mariakani causing massive congestion, irritation and disruption in an attempt to get waived through without checks. Transporters tend to organise bunching as they leave their loading points either at the port, freight stations or other loading sites and head to the weighbridge at Mariakani in the afternoon each day so as to put pressure on the weighbridge system.

KENHA has banned trucks stopping within three km of a weighbridge to try to prevent not only congestion but the ability of police, officials and truckers to mingle and negotiate ways of bypassing the rules.

Despite privatisation of the weighbridges, corruption and inefficiency continued to thrive under the former weighbridge system. The new technology which was employed with the main objective of enhancing axle load control enforcement will greatly reduce cases of corruption by eliminating human intervention in decision making at various stages of the weighing operation and expedite easy passage of compliant trucks through the weighbridges.

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Profile

INNOVATION & TECHNOLOGY drives One 2 One

LOGISTICS LIMITED “We have a committee of drivers that deliberates on all issues and suggest ways of resolving them. It is important to note that with an asset estimated at over 17 million on the highway in the hands of a driver, he is supposed to be the boss of the transporter and not the other way round...” – One 2 one Logistics Limited operations director Newton Wang’oo.

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The Transporter

I

n the recent past, the transport sector has faced a myriad of challenges, with most of the firms experiencing a downturn in business and stiff competition from other players. For a small company to grow from scratch to make a mark in the industry, it calls for innovation, doing things right and a lot of patience.

These are some of the qualities that operations director at One 2 One Limited Newton Wang’oo espouses.

And as we found out during a chat with him recently, this is not all: Wang’oo has a burning drive to ensure that whatever he does, he gives it his best shot.

The company prides in efficient operations, a young, professional and committed work force and use of modern technology, attributes that have won One 2 One Limited an ISO certification, a feat that has eluded many heavy commercial transporters despite operating for several years.

After only seven years of operation, the company was awarded ISO 9001: 2008 certification on 20th August 2014 by QAS International.The new certification, according to Wang’oo, will place the transport firm that relies on international clients at a more competitive edge.

“Today, clients are very knowledgeable and with such an international certification, they will surely feel that they are dealing with a company that will leave them satisfied,” Wang’oo says.

This is a huge feat given that many transporters shy away from seeking this kind of certification.

“The world is changing. We took this route upon realization that in the current business environment you have to move with the global trends if you want to survive.

You stand still, you have chosen to move backwards,” he adds.

Based on the stiff competition the industry is experiencing today, according to Mr Wang’oo, the only way to remain relevant in business is to adopt new approach in doing things.

Started with only three trucks, the company has built its reputation, recording a dramatic growth.

Currently, the company – which is

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part of the bigger Dawda Group which has invested in a number of business chains – boasts of a fleet of 70 trucks with plans to increase the number to 100 by close of this year.

The company places a lot of emphasize on modern technology and was among the first transport firms in Kenya to employ a GPRS system of tracking cargo. The web based system which can be accessed by the client is also able to track movement of cargo besides the truck. This, he notes, is very comforting to a client since they are able to know the position and condition of their goods.

Unlike many other transporters who were at loggerheads with the Kenya Revenue Authority (KRA) on who to bear the cost of installing Electronic Cargo Tracking System (ECTS) with the matter at one time ending up in court, One 2 One, according to Wang’oo, did not support this move but instead installed the gadget in 2010 at a cost of Sh120,000 per unit, risking huge sums of money in an equipment most operators said was not their responsibility but that of the customs since their business was not to track cargo.

“What many did not realize was the fact that the benefits far much outweighed the cost because the transporter also has a responsibility to monitor a client’scargo,” he says, adding that the gadget gave his company and other transporters who had installed ECTS a lot of flexibility allowing them to use the same

Today, clients are very knowledgeable and with such an international certification, they will surely feel that they are dealing with a company that will leave them satisfied.

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Profile

INNOVATION & TECHNOLOGY drives One 2 One Logistics Limited

fleet to haul both transit and local cargo, one of the incentives the taxman used to lure transporters to invest in the venture.

A crucial aspect of success in trucking business that many transporters have not realized, according to Wang’oo, is treating their drivers well. In fact, the company has branded itself One 2 One, signifying its approach on close working relationship between senior management and all the staff, drivers included.

As a sign of the importance the company places on the role of the junior staff, Wang’oo, who says he is a hands-on manager, spends most of the time at Miritini, the location of the yard where The Transporter caught up with him for this interview. One would have expected him to be enjoying the comfort of the company’s air conditioned offices located in the up-market Nyali estate.

“One of the

most serious mistakes managers in the transport industry do is to be aloof with the lower cadre members of staff especially drivers. I love to be on the ground because this is where business takes place and not in those high offices,” he says, adding that this comes with huge results since workers feel that the management cares for their welfare. Indeed, according human resource experts, the amount of money a worker is paid may not count much and they recommend a human relations approach to staff management.

“We have a committee of drivers that deliberates on all issues one-on-one and suggest ways of resolving them. It is important to note that with an asset estimated at over 17 million on the highway in the hands of a driver, he is supposed to be the boss of the transporter and not vice versa.

We also carry out intense training on safety and good business practices,” Wang’oo says. This is the reason, he believes, the company has experienced an extremely low turnover over of drivers for the last seven years.

The company upholds transparency, which Wang’oo says has also been a strong rallying point.

“In spite of many hiccups that are likely to emerge due to the nature of our business, customers will still come back.

There is need to share the correct

information with them, even if it is negative.”

The other serious challenge to transporters and government agencies is overloading. Though optimistic that the measures the government has put in place such as installation of weigh in motion scales and stiff penalties for offenders will curb overloading, Wang’oo says it is still a major challenge to the compliant truckers. By overloading and not meeting other requirements, unscrupulous transporters are able to adjust rates downward to a great disadvantage to their compliant counterparts.

Last year, transporters also signed a code of conduct for selfregulation, committing themselves to adhere to axle load weight limits.

This, according to Wang’oo, is very encouraging because most of the industry players have realized that overloading does not only destroy the road network but is also not beneficial to the transporter in the long run.

On insecurity, the company does not transport cargo at night and the trucks – which are locked at a speed of 65 kilometres per hour instead of the recommended 85 to guarantee safety – leave Mombasa in a fleet of at least three.

Wang’oo also believes that the planned Standard Gauge railway line will not drive truckers out of business as has been feared in some quarters.

“If one is flexible and provide good services, things will be okay. There are many other destinations that the railway will not cover which will provide an opportunity for transporters. Look at many of the developed countries and you notice they have well networked rail and yet immense road transport business still thrives,” he concludes.

One of the most serious mistakes managers in the transport industry do is to be aloof with the lower cadre members of staff especially drivers.

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The Transporter

Infrastructure

T

he World Bank has pledged a 1.2 billion US dollar loan to East African nations to improve integration within the region.

The financier also vowed to support infrastructure development and to boost the competitiveness in the East African Community (EAC) by providing additional resources for regional infrastructure in the next three to seven years.

“We are partnering with the EAC governments, other development partners and the private sector to invest in regional infrastructure and to help deepen policy integration and reduce barriers to trade in the EAC,” said Philippe Dongier, World Bank country director for Burundi, Tanzania and Uganda.

“We are preparing investments to revive the

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region’s inland waterways on Lakes Victoria and Tanganyika, and to enhance the capacity and efficiency of the two main EAC ports on the Indian Ocean – Dar es Salaam in Tanzania and Mombasa in Kenya.”

The funds will also be used to invest in particular transport links to enhance the connection of landlocked countries of Burundi, Rwanda, Uganda and South Sudan to the Northern and Central corridors. This will improve access to the ports of Mombasa and Dar es Salaam as well.

In conjunction with the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA), the bank said it will focus on reforms and policies crucial to the development of regional integration through enhanced efficiency of

infrastructure investment and financing.

Oumar Seydi, IFC director for Eastern and Southern Africa, said, “Working with private sector partners, IFC is already investing more than 1.0 billion dollars annually in sub-Saharan African infrastructure to spur economic growth and improve living standards.”

“IFC intends to do more to support ports, power, rail, transport and other key infrastructure projects in the East African Community in the years ahead,” he added.

The bank is already supporting the EAC’s regional integration agenda with investments of 2.3 million US dollars in 17 regional projects in roads, railways, energy, information and communications technologies, finance and trade, among others.

The Transporter

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ISSUE 25 VOL. 1

Regulation

Lack of a coordinated approach has in the past been blamed by the industry players for overloading. The charter was developed by agencies involved in cargo clearance after realization that the punitive fines were not deterrent enough to root out overloading.

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The Transporter

Transport stakeholders in Kenya last year made a strong statement against overloading by signing a charter that will bind all players to required axle load weight limits.

Fourteen agencies, both in public and private sectors, developed the self-regulatory Charter to check weight limits along the Northern Corridor.

The initiative, they believe, may help address challenges of overloading more effectively since the charter assigns each player duties and responsibilities that will be carried out and promoted by each party. This will be possible through cooperation rather than legislation, enforcement and sanctions which have been there over the years yet the vice has continued to thrive, partly due to corruption.

“This event is very important for the sector and despite some transporters going against the rules, we know that we are going to win the war. Such people who are used to benefiting from excess weight should know that there is no more such business along this route,” said Michael Kamau, Transport and Infrastructure Cabinet Secretary who presided the signing ceremony at Mariakani.

Mr Kamau said the Kenya National Highways Authority (KeNHA) would mount mobile weighbridges at strategic points to

catch truckers who avoid weight check stations. The CS also said the ministry was developing regulations similar to those in the public transport sector that would require transporters to be members of a recognized organization such as Kenya Transporters Association (KTA) to obtain operating licenses.

Lack of a coordinated approach has in the past been blamed by the industry players for overloading and by working together, there will be an easier flow of information between various cargo interveners.

The charter was developed by agencies involved in cargo clearance after realization that the punitive fines were not deterrent enough to root out overloading.

The document, which seeks to commit stakeholders to avoid overloading, was signed by chief executive officers of fourteen organizations including Shippers Council of Eastern Africa (SCEA), Kenya International Freight and Warehousing Association (KIFWA), Container Freight Stations Association of Kenya (CFSA) and KTA. Others were KeNHA, Ministry of Transport and Infrastructure, National Transport Safety Authority (NTSA), Kenya Maritime Authority (KMA) and Kenya Ports Authority (KPA).

“We don’t want a situation where we have signed the document today and tomorrow we continue with the same old business. This charter should be at the bottom of our hearts because by implementing its contents, there will be less accidents and we are going to engage in fair business practices.”

KTA Chairman Paul Maiyo

Development of the charter was spearheaded by the Northern Corridor Transit Transport Coordination Authority (NCTTCA) and KTA, funded by the SSATPWorld Bank through the Multidonor Trade Facilitation Facility (TFF) trust fund.

KTA chairman Mr Paul Maiyo who was also the chairman of the drafting committee told the agencies that had appended their signatures to live up to the challenge, noting that signing alone would be meaningless.

“We don’t want a situation where we have signed the document today and tomorrow we continue with the same old business.

This charter should be at the bottom of our hearts because by implementing its contents, there will be less accidents and we are going to engage in fair business practices,” he said.

Mr Maiyo said KTA had embarked on training of drivers and truckers at their institute, in a move expected to improve awareness on the dangers of overloading.

The problem of overloading has generated a lot of controversy in the past, with transporters at one time urging the government to expand the bracket of responsibility and also charge cargo owners.

A recent survey conducted by the Northern Corridor

“This event is very important for the sector and despite some transporters going against the rules, we know that we are going to win the war.

Such people who are used to benefiting from excess weight should know that there is no more such business along this route.”

Transport CS Michael Kamau

Regulation

WHAT CHARTER SAYS Transport Transit Coordination Authority (NCTTCA) shows that an overwhelming majority of Northern Corridor users – 94 per cent and 91 per cent respectively – believe that overloaded vehicles are a traffic hazard and compliant trucks, overtime, are more efficient and profitable than overloaded trucks.

However, over 89 percent of respondents interviewed from

various stakeholders cited desire to earn more revenue per trip as the reason for overloading. The NCTTCA is also carrying out a campaign which targets to change this pattern, bringing together all agencies involved in cargo clearance and transportation.

According to officials at the NCTTCA, the campaign will be extended to other countries who are members of the Northern Corridor, including Rwanda, Uganda, Burundi and South Sudan.

The Authority has also been monitoring performance of the Northern Corridor, including compliance at weighbridges through the Transport Observatory Project (TOP).

The self-regulatory initiative follows the EAC Vehicle Load Control Bill which was passed in May 2013

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and which harmonizes the gross vehicle weight (GVW) limit to 56 tons across the region. A truck is allowed a maximum of seven axles with 10 tons for each axle.

According to the law, overloading attracts a fine of US$ 60,000 (Sh5.1 million) or imprisonment for three years or both.

Initially, Kenya had a maximum allowable weight of 48 tons, Tanzania 56 while Uganda,

Rwanda and Burundi allowed a maximum of 53 tons. The various measurements were a source of conflict and confusion among the Northern Corridor states.

Governments within the EAC have committed to adopting a unified approach to issues of common interest in the transport sector, of which overload control is critical.

On June 30, President Uhuru Kenyatta witnessed the signing of the Mombasa Port Community Charter which brought together 25 agencies – public and private – which are engaged in clearance of cargo the port.

It is hoped that the two charters will complement each other in the development of consiousness by sector players, aimed at facilating faster clearance of goods at the port and its movement along the Northern Corridor.

Kenya Ports Authority (KPA) is required to share information in advance with the other cargo inspectors on the weight of the containers received based on ship manifests.

Cargo that exceeds the allowable limit of 56 tonnes to be released only through the rail Weighbridges will be installed at all cargo loading points in Mombasa.

Kenya National Highway Authority (KeNHA) will be required to second its staff to the CFSs to ensure that the cargo weighed at the stations will not be weighed along the corridor.

Kenya Maritime Authority (KMA) to develop regulations that will compel shippers of containers to verify their gross weight prior to release at various loading points.

The Transporter

SGS PRESS STATEMENT SGS Kenya Ltd. is appointed by the Kenya National Highway Authority (KeNHA) for upgrading and managing their network of axle load control weighbridges throughout Kenya.

SGS is committed to delivering its services in an effective manner to meet its contractual obligations to KeNHA and protect Kenya's highways from overloading by unscrupulous transporters while at the same time facilitating trade.

In carrying out its mandate for KeNHA, SGS has had to face the enormous challenge of well-entrenched corruption that has existed at the weighbridges for many years.

SGS has taken several actions to combat the problem of corruption at the weigh bridges including the installation of advanced technology which removes discretion by the police and operators at the weighbridge stations, such as, high speed weighing in motion systems for automatic selection of trucks for static weighing, robust weigh bridge software which does not allow for manual entry or manipulation of weight results, automatic number plate recognition cameras, other cameras for recording truck details and activities at the weighbridges, installation of lighting and fencing, employment of security guards, traffic control equipment, traffic census loops, etc.

In February 2014, SGS approached the Ethics and Anti-Corruption Commission (EACC) for their assistance in carrying out undercover investigations of illicit activities at the weighbridge stations and has cooperated and worked together with the EACC to identify all parties involved in the facilitation of overloaded trucks to bypass the axle load weight control.

We are pleased that our close collaboration with the EACC has started to bring results as confirmed by the recent sting operation by the EACC, at the Athi River and Mariakani weighbridges. This confirms SGS's commitment to deal with this vice regardless of who is involved. With KeNHA's support and the support of other government agencies, this collaboration between SGS and the EACC will continue until the problem of corruption at the weighbridges has been eliminated.

Albert Stockell Managing Director SGS Kenya Ltd.

Railway

SGR to boost Kenya’s

GDP GROWTH T

he International Monetary Fund projects that construction of the Standard Gauge Railway (SGR) will help boost Kenya’s economic growth to 6.9 percent in 2015. The IMF said in a statement that the initiation of the highspeed railway project is a major step for Kenya and for the East Africa region.

“The SGR’s initial construction work will contribute to higher real Gross Domestic Product (GDP) growth, projected to rise to 6.9 percent in 2015 from 5.3 percent in 2014,” the organization said.

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China has agreed to fund the first phase of a standard gauge railway line, linking the East African nation’s port city of Mombasa to Uganda, Burundi and South Sudan.

China Exim Bank will fund 90 percent of the 3.6 billion U.S. dollars for the first phase of the project that will cover 485 kilometers from the port of Mombasa to Nairobi. The Kenyan government will provide the remainder of the funding.

The IMF said Kenya’s fiscal monetary policy will aim at preserving debt sustainability while

providing room for the execution of the railway project.

“The SGR will boost integration across East Africa by reducing transport costs significantly, bringing down the cost of doing business and improving standards of living for the population, helping Kenya move closer to the medium-term goals outlined in its Vision 2030 plans,” the IMF said.

According to the fund, imports of equipment for the SGR project combined with continued investment in oil exploration are expected to keep the external current account deficit relatively The Transporter

high at around 8.5 percent of GDP in 2015, albeit a slight decline from a projected 9 percent deficit in 2014 thanks to lower international oil prices.

The contractor, China Road and Bridge Corporation, has already said it plans to employ 30,000 locals at the peak of the project while 40 percent of the work would be sub-contracted to local companies with construction materials being sourced locally.

The SGR is to be constructed in line with the Chinese railway building standards, and its viability is dependent on the assumption that it will be part of a seamless railway system linking Kenya and Uganda, and at the same time serving the landlocked countries of Rwanda and Burundi.

The IMF said the precautionary loan facility it reached with Kenya would accommodate the SGR project and other initiatives launched by the government to remove hurdles to growth, while reducing vulnerabilities and preserving a sustainable debt position.

The SGR is intended to reduce the cost of doing business by reducing the cost of transport, a move that will see Kenya become a competitive business hub for the East African region and beyond.

Passenger trains will operate at a speed of 120 kilometers per hour while those for freight will be designed to move at 80 kilometers an hour.

Analysts say the realization in East Africa is that a common approach to such a project could win if approached jointly. The region expects to use the rail to meet its transportation needs from the port of Mombasa.

Construction of the camps and factories that will manufacture raw materials has been completed along the proposed SGR route.

Two factories that will be used to lay the rail line, produce reinforced concrete sleepers, T- beams and ballast have been completed at Emali and Kathekani- with similar sites planned in Samburu, Mtito The Transporter

Andei and Nairobi.

Most of the issues have since been resolved with the government setting aside Sh10 billion to compensate those who will be affected by the construction. The SGR completion date has been brought forward to from 2018 to June 2017.

Already, the government has started compensating those who have been affected by the project. Recently, Kenya Railways Corporation Managing Director Mr Atanas Maina announced that the government had released Sh5.5 billion to be paid out to land owners.

Mr Maina said land owners in Kwale and Taita Taveta counties will receive about Sh2.5 billion while those from Makueni and Kajiado will receive similar amounts.

“The cash has already been released from the Railway Development Fund. The National Land Commission has furnished us with their bank accounts and we have started depositing the money in these accounts,” Mr Maina told journalists at a press briefing recently.

At the same time, the County government of Kwale and Standard Gauge Railways officials in early January agreed to form an adhoc committee to address the issue of employment.

This followed complaints from residents of Kasemeni, Mwavumbo, Samburu and Mackinnon road wards that they are not given consideration on employment.

Speaking at Mariakani after a meeting with SGR officials, Kwale governor Salim Mvurya said issues of corruption, land compensation and violation of human rights are among concerns that had been forwarded to him.

“This project covers almost 71 kilometers within Kwale County therefore as leaders we have to address these issues before they escalate,” he said.

Give locals priority in ongoing SGR project: Uhuru President Uhuru Kenyatta has directed that half of the over 30,000 jobs to be created by the ongoing construction of the Standard Gauge Railway (SGR) project be sourced in areas where the railway line passes. The rest of the opportunities, he said, should go to youth from other parts of the country since the SGR is a national project. He said he has already agreed with the Chinese government that all employment opportunities arising from the project that do not require foreign expertise be set aside for Kenyans. He was speaking when he visited Mtito Andei in Makueni County to assess progress made on the 485 kilometre MombasaNairobi railway line.

He was speaking when he visited Mtito Andei in Makueni County to assess progress made on the 485 kilometre Mombasa-Nairobi railway line.

Kenyatta said the Government will do everything within its means to ensure the milestone project is complete as soon as possible due to the huge economic benefits it portends.

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Technology

Online system facilitates

CARGO CLEARANCE “In 2005 clearing a container at the port was taking 17 days but now it is only taking an average of one to five days depending on the type of cargo...

If documentation is made faster, this will increase efficiency at the port and enhance revenues,” – KenTrade CEO Alex Kabuga.

T

he Kenya Trade Network Agency (KenTrade) has said an online cargo clearance system has helped to facilitate quick handling of imports and exports at the country’s entry points.

KenTrade chief executive officer Mr Alex Kabuga said although the National Electronic Single Window System has been done on phased implementation approach, much had been realised in terms of reduced congestion at the port of Mombasa. The agency is the one implementing the system, officially known as the Kenya TradeNet.

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“The single window system has drastically changed how we conduct business at our airports and port cargo terminals,” he said. This exposure, he pointed out, was the basis of trying to change the system of handling imports and exports at the port to boost returns for faster services.

“In 2005 clearing a container at the port was taking 17 days but now it is only taking an average of one to five days depending on the type of cargo,” he said, noting that whenever delays or congestion happened at the port the authority bears the brunt of the

The Transporter

blame without considering that other stakeholders could be the problem. Other agencies involved in clearance of cargo are Kenya Revenue Authority (KRA), Kenya Plant Health Inspectorate Service (Kephis) and the Kenya Bureau of Standards (KEBS).

Citing corruption as another impediment, Mr Kabuga said unless it was addressed and eradicated completely it would continue to affect port or airports’ operations in the country. “If documentation is made faster within the single window system, it will increase efficiency at the port and enhance its revenues,” he told delegates during the 10th PanAfrican Ports Cooperation (PAPC) late last year at Leisure Lodge, Diani, Kwale County.

For the integration of the East African regional bloc, Mr Kabuga said there were plans to introduce the system to member states so that they could partner easily in trading or business exchanges.

This, according to him, would not only lower the cost of business but also ensure efficiency in cargo handling in the regional economic bloc.

His agency has already trained about 5,000 clearing and forwarding agents in the country to implement the single window system especially from Malaba entry point and other border posts.

Mr Kabuga spoke even as KRA announced it would only accept declaration documents lodged through the single window platform. This was after KenTrade successfully piloted with over 70 firms that have been granted Authorized Economic Operators (AEO) status.

AEOs started lodging Import Declaration Forms (IDF), permits and other documents through the single window platform from October 1 last year.

The system, developed by Crimson Logic, a leading provider of e-government solutions and services headquartered in Singapore, was first launched on pilot basis with the processing The Transporter

of pre-clearance documentation from eight agencies. The system was fully rolled out to importers from 1st December 2014.

According to KenTrade’s General Manager in charge of Operations Mr. Amos Wangora, the system is able to process export and import permits issued by KEBS, KEPHIS and Department of Veterinary Services. Other permits include those issued by Horticultural Crops Development Authority (HCDA), Pharmacy & Poisons Board and Port Health.

According to an implementation status report released in September last year, eight more agencies were expected to start issuing export and import permits by the end of October this year. These include Kenya

have started the process of full integration.

“It is a core mandate of KenTrade to facilitate trade and we are assisting other government agencies to re-engineer their business processes, seek finances and fully embrace ICT” Mr Wangora said.

Those organizations that have not automated are likely to cause delays since they will rely on manual processes to give approvals before the information is fed into Kenya TradeNet system.

Arising from a survey conducted in 2000, the savings to the economy will be between US$ 150million and US$ 250million per annum in the first 3 years and thereafter between US$ 300m to US$ 450m per annum once the system is fully

The single window system has drastically changed how we conduct business at our airports and port cargo terminals...

Wildlife Services (KWS), Kenya Sugar Board (KSB), Kenya Dairy Board (KDB), National Biosafety Authority and Ministry of Mining.

Other agencies include Coffee Board of Kenya (CBK) and Kenya Radiation Protection Board.

When the system is fully operational, 25 government agencies involved in clearing cargo and issuing import and export documents will be operating through the platform.

At the same time, the agencies are not required to be fully automated to interact with the system since there is a provision where even with an e-portal, any agency, clearing agents and associations engaged with logistics can be linked.

Despite automation of public agencies being still low, with the support of KenTrade and government, many of them

operational.

The specific objective is to reduce cargo dwell time at the port of Mombasa to a maximum three days and a maximum of one day at the Jomo Kenyatta International Airport in a period of two years after operationalisation.

With the country’s annual trade volumes exceeding US$22.4 billion, according to CIA World Factbook based on 2013 trade estimates, Single Window Systemis a flagship project under Kenya’s Vision 2030 programme to position the country as a key trading hub in Africa.

At the border posts, the system is expected to reduce cargo dwell time for both transit and intraregional trade consignments to a maximum of one hour. Today, truckers wait for up to 24 hours to pass the Malaba border point.

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39

Ports

KPA hits a record

1 MILLION TEUs MARK The 13 agencies that signed the charter pledged that the initiative would transform the port and remove bottlenecks that have hindered smooth movement of goods.

K

enya Ports Authority attained a throughput of one million Twenty Foot Equivalent Units in the year ending 31st December 2014.

Applauding the move, managing director Gichiri Ndua said the massive growth significantly strengthens the status of Mombasa port in the league of the best performing ports in the world.

“You may recall that in 2013, having handled 894,000 Teus, KPA was ranked among the top 120 ports in the world out of over 5,000 Ports. Indeed with this current milestone, Mombasa port has the potential to be ranked even higher in the prestigious list of the World Top Container Ports,” Mr Ndua said.

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The port of Mombasa first handled 1,298 TEUs in 1975 and although this figure looks meager compared to today’s 1,000,000 TEUs, it nevertheless kick-started an ambitious plan for KPA to develop a dedicated container terminal, added Mr Ndua.

In 1980, the dream of constructing a modern container terminal was realized. In the first year alone, it handled a throughput of 30,385 TEUs. It was not until 1985 that the port managed to surpass the hundred thousand mark registering 103, 362 Teus and doubling this a decade later to post 200,537 Teus in 1995.

By the year 2007, KPA broke the half million mark. This translating to 585, 367 Teus was an indicator

to KPA that the one million target was in sight and could be overcome with much more effort.

Naturally, statistical expectation was that KPA could conquer the million Teus in 2013.

“However this proposition faltered at the expense of the low business activities witnessed during the electioneering period of 2013 which saw a negative 1 percent decline,” Ndua said.

In the past few years, the government has deliberately sought to increase efficiency at the port. Amongst the most notable was the commitment to streamline and synergise port operations so that the port of Mombasa could efficiently handle cargo within acceptable standards.

The Transporter

In the months of January to June 2014, KPA handled 463,920 Teus compared to 415,948 in the year 2013 reflecting a growth of 11.5 percent. Similarly, July to November 2014 returned 441, 775 Teus compared to 394,379 Teus recorded in 2013 mirroring a growth of 11.8 Percent.

There are number of notable milestones that back up this progress. For example, the Container dwell time has so far reduced to 3.7 days last year from 5.8 days in 2013. Equally, truck transit time has reduced from an average of 7 days to 4 days. Average vessels turnaround time however has maintained 3.4 days as in 2013 despite having handled more ships and volumes than last year.

“KPA also embraced Port Automation upgrades so that our customers enjoyed carrying out their business from the comfort of their offices.

The port has continued to acquire modern cargo handling equipment to match with the business growth,” the MD said.

Last year, KPA acquired 9 new Reach Stackers, 12 Terminal Tractors and 12 Rubber Tyred Gantry cranes (RTGs).

“To complement ship and shore handling at the Container Terminal, we have ordered for more 3 Ship to Shore Gantry cranes. These positive trends and achievements and many more should not make us complacent but encourage and put us in a better position to perform even better in the New Year,” Mr Ndua added.

The Transporter

NORTHERN CORRIDOR:

A promising efficient and smart economic corridor Contd. from page 21

Mariakani Weighbridge Compliance Level

load and gross weight regulations”.

The Vehicle load control campaign program in Kenya is being spearheaded by the NCTTCA in conjunction with the Kenya Transporters Association (KTA) and with the support of SubSaharan Africa Transport Policy Program (SSATP) of the World Bank.

A Campaign action plan for Kenya was drawn during a meeting of Stakeholders in Kenya held on 27 January 2014 and the activities for the campaign culminated in the launch of the Vehicle Load Control SelfRegulatory Charter on 13 October 2014.

“As the Vehicle load control self regulation campaign is bearing fruits in improving the performance, safety and certainty of the corridor, said Donat Bagula, “the program is now being progressively rolled out in the remainder of the Northern Corridor Member States of Uganda, Rwanda, Burundi, DR Congo and South Sudan for great effective implementation and efficient

enforcement leading to regional integration”.

By piloting the Axle Load Control charter in Kenya, the region stand a chance to improve on Vehicle Load Compliance at various weighbridges and will further lead to reduced cost of road maintenance and a decline in the numerous accidents due to overloading within the region.

“Among other issues to be harmonised, added Bagula, include the Transit road user charges which currently have the potential of double taxation to users. Thus there is need for their review in order to enhance the competitiveness along the Northern Corridor region”.

Other ongoing initiatives listed include the regional electronics cargo tracking and single window, the self regulatory initiatives in order to foster the green channel by developing integrated management information systems along the Northern Corridor.

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41

Ports

African inland infrastructure woes

COST SHIPPERS DEARLY

A

frica’s inland freight network is so troubled that it costs roughly seven times more to ship a container from Mombasa, Kenya, to Burundi, in central Africa, than to ship a container from Shanghai to the major Kenyan gateway, an APM Terminal executive said.

Shipping a standard 40-foot container from Shanghai to Mombasa, Kenya costs less than $1,000, according

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to a study by the African Development Bank. Moving that same container from Mombasa to Burundi, a distance of about 1,200 miles, costs a shipper $7,000. The ocean voyage from China to Kenya takes 28 days, while the road trip inland to Burundi takes 40 days, Moussa Diop, commercial director for inland services West Africa, said at the TOC West Africa Market Briefing conference last week.

The lack of road and rail

options for African importers is taking its toll on the continent’s trade growth, which is being driven by some of the fastest-growing economies in the world, Diop said.

“It is critical to establish inland capabilities and operations that serve adjacent and hinterland markets, including dry ports and cargo depots,” Diop said in his speech. “Effective intermodal transportation The Transporter

and inland services involves logistics, trucking, stevedoring, warehousing, storage, cargo handling, storage, container depots and refrigerated container operations.”

To help facilitate inland transport, carriers and terminal operators have made the rare move of creating their own inland infrastructure.

APMT operates 35 inland service facilities, with some facilities as far inland as Uganda and Mali. CMA CGM has warehousing and depot operations in Senegal and Cameroon, and is constructing additional facilities in Ghana and Mozambique.

“We need to be able to go deep into Africa and hand boxes to importers who are working in the bush,” CMA CGM Africa Lines Vice President Mathieu Friedburg told JOC.com. “In the U.S., there are 10 ways to get to one destination. In Africa, that’s not true. When boxes hit inland Africa, there are some regions that are logistical nightmares, with inflation and customs issues, and a logistically poor environment when it comes to roads.”

Most countries have invested in their ports, but their road networks are spotty. Railroads only reach a handful of population centers.

“You can start from the tip of North Africa, and coming down, there are pockets of stability, but it’s unreliable,” Chris Palmer, director of global projects for thirdparty logistics provider Crane Worldwide told JOC. com. “Right now, typically shipments terminate at the port or the airport, where cargo is handed off to the buyer’s custom broker or a transport specialist.”

Among foreign investors, the Chinese are leading the charge

The Transporter

to invest in the continent’s freight infrastructure. China signed a $12 billion rail deal in Nigeria in November to build a 1,400-kilometer line long that parallels the Nigerian coast from Lagos before turning inland to the oil fields of eastern Nigeria. Nigerian transport officials say the rail is just the first piece of a nationwide rail system.

Foreign investors other than the Chinese are also stepping up their game. Financing for a $865 million rail system in Ethiopia will come from commercial loan banks in Europe, Africa, the U.S. and the Middle East. A $415 million complimentary cargo facility is backed by a Swedish creditor,

Law360 reports. The rail line will be built over the next three years and will connect the central and northern parts of the country.

Several other projects are also in the works, ground carrier DHL Africa said. The $1 billion North-South Africa corridor will add 10,000 kilometers of roads in the coming years, connecting South Africa to Zambia and the Democratic Republic of the Congo, and running from Botswana to Malawi. The Mombasa-Kigali railway in East Africa will add 2,935 kilometers of rail, and link Kenya with Tanzania, along with the landlocked countries of Rwanda and South Sudan.

SHIPPING 40-FOOT CONTAINER FROM

CHINA TO BURUNDI VIA MOMBASA

CHINA TO KENYA OCEAN VOYAGE

28 days 6,981 n. miles <$1,000

CARGO DWELL TIME AT MOMBASA PORT

3.7 days

KENYA TO BURUNDI ROAD TRIP

40 days 1,200 miles $7,000

ISSUE 25 VOL. 1

43

Logistics

New roads to ease traffic jams

IN MOMBASA

Congestion especially along airport road has been blamed for delays caused to travelers driving to the airport, with some missing their flights. The government will focus on improving roads on the mainland, including a key six kilometer link from the new container terminal to the southern by-pass.

T

he congestion crisis facing Changamwe, one of the busiest areas with several yards owned by transporters is set to ease after the government announced plans to construct a dual carriage way from Moi International Airport to Changamwe roundabout.

Transport Cabinet Secretary Engineer Michael Kamau in a recent Coastal tour said that funds for the project had been secured after Trademark East Africa (TMEA) approved $15 million (Sh1.3 billion) while the Government factored the remaining balance of $24million (Sh2.1 billion) in its 2015/2015 budget. According to Kenya National Highways Authority (KeHNA), the time for completion of works is 36 months.

Speaking at Changamwe where the airport road joins Magongo

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road, coast regional manager Mr Kevin Nyabuto said a flyover would be constructed at the junction, to allow proper flow of traffic from both sides.

Construction of the dual carriage is one of the five Sh52 billion infrastructural projects that the Government intends to undertake, some of which are in the tendering stage while others are under construction to enhance Mombasa’s East and Central Africa transport hub status.

Besides the airport road, the government has already advertised the tender for the construction of the first phase of the Dongo Kundu road, which entails building of another dual carriageway from Miritini to Kipevu with interchanges at Miritini and an arm joining the second container terminal that is being constructed at Mombasa port.

Transport and Infrastructure Principal Secretary John Musonik said the government had received a loan facility of Sh25 billion from Japan International Cooperation Agency (JICA), in honour of an agreement signed in June 2012, in readiness for the project kick off.

“The project will be implemented in three packages. The first is Miritini to Kipevu link road, Mwache to Dongo Kundu which includes construction of long span bridges over the creeks and DongoKundu to Kibundani to link with Likoni-LungaLunga road,” Mr Musonik PS said.

He said the first phase of the project would be completed in three years, and provide an important link between the new container terminal at Mombasa port, whose first phase is due for completion mid this year.

The road will start from Kipevu where the terminal ends and The Transporter

join Mombasa-Nairobi highway at Mwache, Miritini, about 14 kilometres from Mombasa town, where there will be an interchange with plans to relocate the railway line at this point to allow construction.

“Construction of this phase is critical since currently there is serious congestion on the section especially between Jomvu and Mwache. Motorists spend several hours on a 10 kilometre stretch,” he said.

Mombasa port stakeholders have in the recent past expressed concern over congestion at the port’s precincts, which has resulted to choking of the facility’s exits, causing frequent pile up of cargo.

“We expect to open the bids soon and have the work commence immediately because there is an urgent need to clear the congestion around the port and improve its competitiveness. We have a lot of expansion projects going on at the port and we need roads to handle the extra capacity,” a Kenya National Highway Authority (KeNHA) official said.

The Dongo Kundu by-pass will be constructed under the Mombasa Port Area Road Development Project (MPARD) that aims at curbing traffic congestion. The road will pass through south of

the Moi International Airport and west of the Port Reitz harbour before turning south. It will link Miritini on the mainland to Ng’ombeni in the south and include four bridges, and connect the Likoni-Diani highway.

Two large bridges will be constructed, including a 495m span over water at Mkupe and a 1,360m span at DongoKundu, according to KeNHA. In the second phase of the project, the government will focus on improving roads on the mainland, including a key six kilometer link from the new container terminal to the southern by-pass.

The by-pass will be a major relieve to transporters in Mombasa who have been experiencing serious challenge due to the poor condition of the roads and increased cargo volumes. During pick hours, trucks take over an hour to do the three-kilometre road stretch between Changmwe and Miritini on the Mombasa-Nairobi highway.

This has also increased the cost of maintaining the trucks due to the frequent breakdowns, robbing truckers huge profit margins, according to Kenya Transport Association (KTA).

More than 1000 containers are loaded out of the port every day. The problem of congestion

is compounded further by the construction of dozens of Container Freight Stations (CFSs) along the Mombasa-Changamwe road and parking of heavy commercial vehicles including oil and gas tankers on road reserves.

Mombasa port’s Gate 18 is currently dedicated to containerized cargo while gate 10 and 12 are used for conventional cargo and vehicles. Gate 18 joins the main highway at Changamwe and has been a major cause of traffic jam at Kibarani and Airport road.

“With DongoKundu by pass in use, the trucks will easily avoid Changamwe circuit by joining the highway at Miritini,” Bernard Osero, the corporate communications manager at Kenya Ports Authority (KPA) said in a recent interview.

The growth in cargo volume requires an efficient evacuation from the port. The volumes recorded a growth of 12.8 per cent in the better part of last year due to the ongoing expansion in capacity and enhanced efficiency.

According to KPA Managing Director Mr. Gichiri Ndua, besides the increase in overall cargo output, the volume of transit goods in Uganda has risen this year.

He attributed this performance to the opening of berth 19 in August

Second Nyali bridge to be built soon, says Transport CS Plans are at an advanced stage to build a second Nyali Bridge, to link Mombasa Island to the North Coast, Transport Cabinet Secretary Michael Kamau has said.

The new bridge is expected to ease traffic on the current 400-metre Nyali Bridge, which is the only major connection to the North Coast.

Kamau said the bride will be constructed through a public-private partnership.

Nyali bridge serves thousands of motorists on the Mombasa-Malindi highway and residents living in estates in the northern part of the island.

These include Nyali, Bamburi, Kisauni, Mshomoroni, Shanzu and Mtwapa in Kilifi county.

Kamau said the team includes transaction experts from the national government who will lead in identifying the most appropriate location for the bridge.

“We will be commencing construction of the second bridge very soon,” he said.

He was speaking on at the Kenya Ports Authority headquarters.

Present were Treasury Cabinet Secretary Henry Rotich and Principal Secretary Nduva Muli.

The Mombasa government has been under pressure from residents and the business community to fast track construction of a second bridge to ease congestion on the Nyali Bridge. Mombasa County transport executive Abbas Mohammed said the World Bank has agreed to fund the project.

The Transporter

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45

Integration

Ugandan traders not aware of

SINGLE CUSTOMS

TERRITORY

A

study commissioned by the ministry of finance shows that most of the Ugandans are not aware of the Single Customs Territory (SCT). The study, sponsored by Trademark East Africa (TMEA) stood at 41 percent.

According to the between September and November last year showed that the level of awareness among Ugandans study, some Ugandans are losing out on the advantages of the SCT whose implementation commenced in July last year.

SCT seeks to reduce the cost of business as well as increasing market access among other objectives.

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Paul Bagabo, the lead consultant explained that due to lack of awareness, firms will not demand for better provisions that can help them access raw materials. They can also not effectively demand for the removal of certain barriers if they are limiting access to markets.

“This implies that Ugandan firms will not enjoy the benefits of SCT and for any policy maker, the low percentage cannot influence policy or design of appropriate interventions to help when the situation goes bad,” Bagabo said.

The outcome of the analysis showed that most people involved in the process know about the revenue management, either because URA has done good

awareness or that people know about paying for import taxes and the procedures involved like bonding, warehousing, among others.

Mr Bagabo however notes that most people do not know about the processes or provisions to do with free circulation. “These are the new provisions that need to be clearly understood if they are to benefit Ugandans,” he said.

According to Bagabo, for SCT to have impact, there is need for a critical mass of people to know most of the issues especially on trade facilitation and free circulation of goods so as to benefit.

SCT ensures that taxes of goods transported through East African The Transporter

SCT EXPLAINED A Single Customs Territory is described as a stage towards full attainment of the Customs Union which is achievable by the removal of restrictive regulations and /or minimization of internal border controls on goods moving between the Partner States with ultimate realization of free circulation of goods. The EAC SCT covers Partner States namely Burundi, Kenya, Rwanda, Tanzania and Uganda.

Community member countries are collected at the point of entry. The process of initiating SCT followed the EAC Heads of State Summit in April 2011 that directed the Council of Ministers to do a feasibility study for the attainment of a Single Customs Territory.

In its findings, the council reported to the Heads of state who on 25th June 2013, held a Tripartite Summit in Entebbe and directed among other things the collection of customs duties by Uganda and Rwanda before goods are released from the port of Mombasa. Burundi and Tanzania joined the other three countries last year. For the goods destined for warehousing, importers continue remitting security bonds.

It is expected that once SCT becomes fully operational, it will be at par with other customs unions such as the South African Customs Union and the European Union.

The union is supposed to facilitate the elimination of restrictive regulations such as Non-Tariff Barriers (NTBs) as the corridor becomes one region for customs purposes. This means that goods can move across the borders with minimal controls.

The Transporter

New roads to ease traffic jams

IN MOMBASA

2013, improved cargo handling infrastructure and removal of non-tariff barriers.

The total cargo throughput (all cargo passing through the port) between January and June 2014, rose by 12.8 per cent to 11.9 million tons from 10.5 million tons in a similar period in 2013.

Similarly, container traffic grew from 415,948 Twenty Foot Equivalent Units (TEUs) in 2013 to 463,920 TEUs in 2014, representing 11.5 per cent growth, which is above the global average growth rate of eight per cent per year.

Imports grew by 11.7 percent posting 10.06million tons compared to 8.90 million tons registered in 2013. At the same time, exports rose by 13.9 per cent to 1.65 million tons up from 1.45 million tons in 2013. Kenya is a net importer of goods mostly crude oil, machinery and agricultural inputs.

“The above performance is attributable to continued application of the best management practices, well-coordinated effort of all port cargo interveners, improvements in cargo handling facilities and removal of non-tariff barriers along the Northern Corridor,” said Mr Ndua.

The MD says that transit traffic recorded an impressive 9.6 per cent growth to stand at 3.53 million tons up from 3.22 million tons in 2013. “Uganda,

our biggest transit market, has continued to increase its usage of the port,” he added.

According to Mr Musonik, as part of the development of a system of ring roads and bypasses to decongest Mombasa city, designs were underway for the proposed Mombasa Northern Bypass linking Mazeras to the Mombasa-Malindi road in North Coast.

He said other initiatives include development of a second Nyali Bridge under Public-Private Partnership arrangements and to provide a more reliable link to the South Coast, plans have commenced for the development of the Likoni Bridge to replace the Ferry.

“We know that coast residents have suffered due to poor infrastructure but we assure the public that their concerns are being addressed. All these projects are now a reality and whoever comes back to Mombasa five years from today will be shocked at the transformation of the city,” he added.

Congestion especially along airport road has been blamed for delays caused to travelers driving to the airport, with some missing their flights.

Tourism stakeholders have over the years complained over these delays, saying poor infrastructure within the coastal resort city was a hindrance to growth of the tourism sector.

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Truck

world

A quick look at what’s happening in the truck industry and what manufacturers are up to.

Daimler sells nearly 500,000 trucks in 2014

MAN eyes 11% French Japanese truckmakers to truck market share in 2015 export more Asian output

Daimler Trucks sold nearly 500,000 trucks in 2014. Despite partly difficult market conditions, the world’s leading manufacturer of commercial vehicles succeeded in increasing deliveries to 445,300 units in the first eleven months of 2014, an increase by 3% over the same period last year.

Based on first Dec figures, Daimler Trucks expects to finish 2014 with a considerably positive sales growth reaching nearly 500,000 units. Final worldwide sales figures will be published at Daimler’s annual press conference on Feb 5, 2015.

In 2013, Daimler Trucks sold about 484,200 vehicles of the Mercedes-Benz, FUSO, Freightliner, Western Star, Thomas Built Buses and BharatBenz brands.

“Our intense efforts in all regions are paying dividends. Despite many economic challenges in some key markets, we can look back on 12 successful months. With almost 500,000 trucks sold we are already coming very close to our target envisaged for 2015,” said Daimler AG management board member Dr Wolfgang Bernhard.

For commercial vehicles, 2014 was dominated by developments that varied widely by regions. Weak economic prospects but also political uncertainties put a strain on the market development in Latin America.

The German manufacturer is confident in its ability to grow in the French truck market this year.

In a market segment that witnessed a drop of sales by 13% last year - the aftermath of the end of life of Euro 5 trucks – MAN Trucks & Buses saw its market share grow to 10.2% compared to 2013. In the last quarter alone, the brand’s market penetration rose to 11.7%. Trucks that meet the new Euro 6 standard accounted for nearly 70% of its sales in the yaer in review.

Two segment were particularly dynamic for MAN Truck & Bus last year: the tractor on which the manufacturer had weighed 10.3% market share, and the special vehicles, where it achieved a share of 9.7%.

In the market for carriers, the German manufacturer maintained its penetration at 10.2%.

On a French market heavyweight, estimated to be around 40,000 units in 2015 MAN Truck & Bus is expected to grow and command 11% of the market share.

The manufacturer will be building on the innovations presented at the last show in Hanover, such as new engines available on the tractor range, the launch of the D38 or the TGX EfficientLine 2 and its service offering.

Japanese commercial-vehicle manufacturers are exporting more of their Asian output to the rest of the world in order to stabilize production volumes and cultivate new markets in Africa and elsewhere.

In Thailand, Isuzu Motors will increase exports of light commercial vehicles by 30 per cent to a record 89,800 units in the current fiscal year through March 31. The vehicles will be shipped to Australia and Europe as well as Saudi Arabia and other parts of the Middle East.

In addition to assembling the vehicles, Isuzu’s Thailand operations also supply parts modules to other assembly plants in Asia, Africa and South America. Total exports, including both the vehicles and the modules, is expected to increase 27 per cent on the year to the equivalent of 168,900 units, surpassing output of 143,400 units for the Thai market. With exports offsetting a decline in the home market, overall production will expand 4 per cent to 312,300 units.

UD Trucks is planning to mass-produce the Quester, a truck designed for emerging markets, in Thailand and will ship the vehicle to Latin America, Africa and the Middle East. The company will set up a dedicated building within the premises of an existing site of Swedish parent Volvo.

Volvo acquires 45 percent of Chinese truck manufacturer AB Volvo completed the purchase of 45% of Chinese automotive manufacturer Dongfeng Commercial Vehicles for approximately $884 million.

Volvo signed an agreement in January 2013 with Dongfeng Moto Group to acquire 45% of its commercial vehicle subsidiary, which includes most of DongFeng’s operations in heavy-duty and medium-duty commercial vehicles. To complete the transaction, approval had to be granted from the Chinese competition authority and other regulatory organizations.

The acquisition strengthens Volvo Group’s position in mediumduty trucks and will make the Volvo Group one of the world’s largest manufacturers of heavy and medium-duty trucks, according to the company. The Chinese truck market is the largest in the world, amounting to 774,000 heavy-duty trucks and 286,000 medium-duty trucks in 2013.

Dongfeng was the leading manufacturer in both markets with sales of 120,600 heavy-duty and 51,000 medium-duty trucks and a market shares of 15.6% and 17.8% respectively.

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The Transporter

Global MINNESOTA

GREENBELT

SYDNEY

Road transport joins the online auction world in Europe

Commercial vehicle demand softens in China, ACT reports

Transportation Department officials have said that Mexican trucking companies will soon be able to apply to make long-haul trips into the United States, ending a protracted dispute.

The policy change is expected to open up more trade between the two border countries and lead to the permanent termination of more than $2 billion in annual retaliatory tariffs on U.S. goods.

U.S. officials cleared the way for Mexican trucks to apply after a three-year pilot program determined that Mexican carriers could meet the safety levels at least as high as the U.S. and Canadian trucking firms.

“Opening the door to a safe crossborder trucking system with Mexico is a major step forward in strengthening our relationship with the nation’s third largest trading partner, and in meeting our obligations under NAFTA [North American Free Trade Agreement],” said Transportation Secretary Anthony Foxx.

The department also submitted a report to Congress on Friday with findings from the pilot program.

Dutch company Cargotrax has introduced, claiming to be the first company in Europe, an online auction service for freight (truck loads). The company claims to have 400,000-plus truckers and more than 2.5m freight senders on its network.

This auction is intended exclusively for B2B: carriers, forwarders, wholesalers and manufacturers can place their loads at the auction with the maximum as the starting price.

After this price European transport companies can place a lower bid.

Subscribing companies on the Cargotrax website initially receive 20 free credits that they can use to put ten free loads or bids on freights.

Placing a load and, the lowest bid on a load, will cost five credits. The owner of the load can decide from which European countries they want to receive bids.

The advantages of the auction are claimed to be that the owner of the load gets the lowest price, and it also saves them a lot of negotiating time.

The pace of China’s economy tapered in the third quarter, leading to a slower rate of growth in truck demand, according to the most recent quarterly China Commercial Vehicle Outlook, published jointly by ACT Research Co. and China’s State Information Center.

“Investments, which drive truck demand, were relatively strong but experienced some cooling” in the quarter, Frank Maly, ACT’s director of commercial vehicle transportation analysis and research, said in a statement.

“Heavy- and medium truck markets will remain subdued in the near-term,” he said, adding that “renewal of [Chinese] government subsidies supporting alternative energy buses will buttress the alternative-fuel share of that market in the future.”

China’s third-quarter gross domestic product growth was 7.3% — down from 2013 full-year GDP growth of 7.7%. The country’s GDP rose 7.8% in 2012, 9.3% in 2011 and 10.4% in 2010.

www.thehill.com

www.tandlnews.com.au

www.ttnews.com

Cheap oil will fuel global economy: World Bank www.smh.com.au BEIJING: The slump in oil prices is set to boost the global economy, with crude-importing countries expected to substantially benefit, says the World Bank.

A 10 per cent drop in oil prices would increase gross domestic product in oil-importing countries by 0.1 percentage points to 0.5 percentage points, World Bank research said.

Oil has slipped more than 50 per cent since its 2014 peak, and while the World Bank scenario cannot simply be multiplied, economic growth in oil-importing countries is likely to see a significant boost.

The World Bank’s most recent forecast for global growth in 2015 came out in October, predicting a rise of 3.2 per cent.

In China, a 10 per cent drop in oil is expected to lift the growth by 0.1 to 0.2 percentage points, so the current slump will likely boost the world’s second-largest economy strongly.

Fund manager BlackRock said in its 2015 outlook that a $US25 fall in oil prices could lead to an uptick of 0.5 percentage points in Chinese GDP. According to The Transporter

BlackRock, the GDP effect on Australia is negligible.

In China, oil accounts for just 18 per cent of energy consumption, while 68 per cent is coal - yet the country is still the world’s second-largest oil importer. The most oil-dependent sectors in China are transportation, petrochemicals and agriculture.

The World Bank estimates that sustained low oil prices in 2015 will widen China’s current account surplus between 0.4 and 0.7 percentage points of GDP. In other developing economies, lower oil prices can reduce governments’ need to provide fuel subsidies and thus bolster their coffers.

Developing oil-importing economies such as Brazil, India, Indonesia, South Africa and Turkey will all see lower inflation and a reduction in current account deficits thanks to cheap oil.

However, a slowdown in growth from oil-exporting countries could have knock-on ramifications for other emerging and frontier economies, the World Bank warned.

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INDUSTRY NEWS

US opens roads to Mexican trucking firms

49

Truck&Trailer INOVATIONS, TRENDS & DEVELOPMENTS

SAF-Holland expands CBX series

Scania develops smartwatch for truck drivers Scania has collaborated with Sony Mobile to develop the Black Griffin, a smartwatch that’s designed for truck drivers and can display telematics information.

The Black Griffin appears to owe a lot to the design of Sony’s recently released Smartwatch 3, and Scania say that its watch will have similar capabilities. In addition to the regular smartwatch features, Scania says that the watch will allow drivers to see fuel consumption, speed and driving efficiency data on the watch, all sourced from the truck’s telematics.

Scania connected services head Mattias Lundholm acknowledges that the ‘wearables’ trend is in its early stages.

“However, we see exciting opportunities for connecting a wristwatch to the essential information obtainable from a truck’s technical systems, as well as to data from our systems for real-time monitoring and analyses of truck fleets,” Lundholm adds.

Like the Sony Smartwatch 3, the Scania watch requires an android phone to operate.

“We wanted to develop technology that allowed the Scania Watch to truly serve as a friend of the driver.

Existing fleet management apps have primarily targeted transport companies and fleet operators.

The Scania watch, combined with the new app, takes the technology one step further and helps the driver in his or her daily work” Scania project manager Jonas Svanholm says.

Just 999 of the limited edition watches will be made initially, but Scania say that they plan on continuing to develop newer watch iterations as well as new software updates for the existing device. www.fullyloaded.com.au

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SAF-HOLLAND has expanded its CBX Series air suspension/slider axle system with the new SAF CBX46 and CBX50. They offer robust 5.75-in.-diameter axle technology along with increased capacity and cast-steel suspensions, providing what the company calls “the optimal balance of strength and weight” for on/off highway applications.

With 46,000-lb capacity, the SAF CBX46 is available in the U.S. and Canadian markets for moderate- to heavy-duty van and reefer applications. The CBX46 includes a substantial upgrade to the overall slider strength and rigidity, incorporating a thicker 80-KSI high-strength-steel slider sub-frame material shared with the robust CBX69 Tri-Slider Series. The thicker side sill yields a 31% increase in overall structural rigidity over the company’s CBX40 slider.

The CBX46 includes a new trailing arm shared with the SAF CBX23, providing increased strength and load capacity while minimizing overall weight. www.todaystrucking.com

Lightweight trailer suspension RIDEWELL SUSPENSIONS has added new 13,200-lb-capacity trailer suspensions to the RSS-233 product line. They’re designed to reduce weight without sacrificing overall durability, the company says.

Their design includes a compact mounting envelope to simplify installation and a dual-draw-key kingpin design to extend kingpin life. They also feature fully cast axle ends for increased strength and durability and are the only steerable liftable suspension available with a tire-inflation system.

Other features of Ridewell’s RSS-233 13K include 10’-20.5-in.’ ride heights with 13 in. of total travel and a 9.5 in.’ lift. Options include a preplumbed air tank. www.todaystrucking.com The Transporter

The Transporter

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