This archive report was first published on 14 January 2020.
Kenya's Standard Gauge Railway (SGR) has revolutionized cargo transportation in East Africa, offering a cheaper and more efficient option for landlocked countries. However, the growth of the SGR has resulted in job losses for truckers, who are struggling to adapt to the new reality.
Since its launch in December 2017, the SGR has seen a significant increase in cargo volumes, with the Inland Container Depot (ICD) in Nairobi handling up to seven cargo trains daily. The ICD has also benefited from the move of cargo clearance from Mombasa to Nairobi, with the SGR hauling close to nine million tonnes of cargo in 2019.
Uganda's business community has welcomed the SGR, citing the reduced time taken to clear and transport cargo from one week to a few days. However, a section of Mombasa-based Ugandan transporters has joined Kenyan long-haul transporters and logistics companies to protest the loss of business since the SGR started its operations.
According to Gilbert Lagat from the Shippers Council of Eastern Africa, importers should choose the most convenient, cheap, and secure transport means, and in this case, it is the SGR. The SGR offers a fast mode of transport, hence it's of benefit to importers who want their cargo delivered on time.
However, for truck body-building companies like Trans Trailers, there has been an increase in demand for trucks with low loaders and extendables for abnormal cargo that cannot be ferried by the SGR. Transport firms that have lost business to the SGR are having their trucks fabricated into specialized trucks as they seek to remain afloat.
Other companies have had to take drastic measures, with the Paris-headquartered Bollore Transport and Logistics Group relocating from Mombasa to Nairobi. According to Jason Reynard, the firm's chief executive for East Africa, it was inevitable to restructure the company's operations, including relocating sea freight import operations from Mombasa to Nairobi to survive in the new operating environment.
As of 2020, cargo throughput at the Inland Container Depot (ICD) in Nairobi grew by 61.1 per cent from 257,972 TEUs in December 2018 to 415,650 TEUs, according to Kenya Ports Authority (KPA) latest data. The increased performance is attributable to more daily SGR trains between Mombasa and Nairobi, where an average of 10 trains leave daily for the ICD Nairobi.
