Global maritime trade is set for further growth, according to a 2018 UNCTAD review that points to stronger world economic activity and rising merchandise volumes. The same outlook is being reflected at the Port of Mombasa, where the Kenya Ports Authority says it had already exceeded its annual container target by early December.
In its Review of Maritime Transport 2018, the United Nations Conference on Trade and Development said sea trade should continue rising in the short and medium term. The report projected global GDP growth of more than 3.0 percent over the 2018–2023 period, with merchandise trade volumes expected to rise by 4.4 percent in 2018 and 4 percent in 2019.
UNCTAD said world seaborne trade would grow at a compound annual rate of 3.8 percent during that period, based on IMF growth forecasts for 2018–2023. It added that containerised cargo and dry bulk commodities were likely to post the fastest gains, while tanker trade would also rise, though at a slower pace.
At the local level, KPA managing director Daniel Manduku said the port had hit its annual target of 1.2 million twenty foot equivalent units, or TEUs, by December 5. He said the authority had also met its target for conventional cargo volumes.
“As of December 5, KPA had hit its annual target in terms of container and conventional cargo volumes. Although we have received fewer ships than the previous years, we are receiving bigger vessels at the moment and we have hit now 1.2 million Teus,” said Dr Manduku.
He said the authority now measures performance not only by ship calls but also by TEUs, dead weight tonne, and key performance indicators. On that basis, he said, KPA had already gone beyond target and expected to finish the year at least 8 percent to 10 percent above plan.
Manduku said KPA was also turning its attention to the Great Lakes region, with Rwanda, Burundi and Congo among the markets it wants to grow further. He said the authority planned a marketing mission to Rwanda, Burundi and Eastern Congo by January 2019.
But some traders said port operations were still being slowed by government measures introduced from January. Car Importers of Kenya chairman Peter Otieno said the changes had created confusion and increased demurrage costs.
“The business is good only for shipping lines who smile all the way to banks thanks to demurrages because of the confusion that was brought by the government from January,” he said.
Otieno said importers had been denied the chance to nominate cargo to their preferred Container Freight Stations because of the use of the SGR. He said the result was heavy container demurrage charges, which he said went directly to shipping lines.
He also argued that the arrival of larger vessels had not translated into the level of cargo movement traders expected. In his view, KPA handles loading and offloading, while the Kenya Revenue Authority collects taxes and should not direct where cargo is cleared.
“Secondly, the Kenya Revenue Authority (KRA)’s mandate is to collect taxes irrespective of where the container is going to. They are not supposed to direct where that cargo should be cleared from,” Mr Otieno said.
Inter-Governmental Standing Committee on Shipping acting secretary general Kassim Mpaata offered a more positive assessment, saying business across member states remained strong. ISCOS was formed in 1967 by Kenya, Tanzania, Uganda and Zambia to protect their shared shipping, maritime and logistics interests.
Mpaata said cargo movement in the region had increased for the past three years, with higher volumes recorded at Dar-es-Salaam and Mombasa. He said member states had responded by investing in port capacity.
“Cargo flowing to the region has been on the increase for the last three years. We have registered increased cargo in Dar-es-Salaam and Mombasa ports,” he said.
UNCTAD’s report said dry bulk commodities were projected to grow at 4.9 percent annually between 2018 and 2023, while containerised shipments were expected to rise by 6 percent. It also forecast crude oil trade growth of 1.7 percent over the same period and combined petroleum products and gas growth of 2.6 percent.
The report said the outlook could be supported by trade liberalisation measures, including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, the European Union-Japan economic partnership, the EU-Singapore trade and investment agreements, the Regional Comprehensive Economic Partnership, and the African Continental Free Trade Area. UNCTAD said the African pact could lift the value of intra-African trade by 33 percent.
Even so, the agency warned that the shipping outlook faces risks from rising trade tensions, while digitalisation, e-commerce and the Belt and Road Initiative could reshape shipping routes and operations. It said the industry’s value can no longer be measured by scale alone, but also by how well it uses technology to improve efficiency and cut costs.
