Kenya scraps Shs11m deposit fee on Uganda-bound containers

The Kenyan government has announced that it is to remove deposit fees on containers carrying Ugandan goods at Mombasa port.

Kenya Ports Authority has been charging $3,000 (about Shs11m) per container, which the Ugandan business community has always opposed, saying it increases import costs.

The decision to scrap the fees was reached at in meeting between Ugandan and Kenyan authorities at Mombasa Port yesterday.

In a statement issued yesterday, Capt William K. Ruto Afni, the managing director of Kenya Ports Authority, said the scrapping of the fees will ease trade between the two countries.

“Capt Afni said Uganda remains a key trade partner for Kenya as its exports and imports passing through Mombasa are increasing. Almost 50 percent of the costs incurred by most Ugandan traders go into handling port and transport expenses. If these costs were mitigated price levels would fall significantly,” the statement reads in part.

According to the existing rules, importers face a $40 daily charge 15 days from the time their goods reach the country, besides the $3,000 deposit paid to the shipping line.

If the trader fails to return the container on time, he or she forfeits the deposited amount.

The Permanent Secretary in the Ministry of Foreign Affairs, Mr Vincent Bagiire, who led the Ugandan delegation, also called for removal of all regional trade barriers between the two countries.

“Bagiire said it is important for member states to remain committed in developing regional transport infrastructure as it will promote regional integration and trade. He said the cooperation and commitment will eliminate the remaining non-tariff barriers to trade thereby making the region competitive for business and investment,” the statement read in part.

Appeal

Mr Bagiire said the improvement of infrastructure by the regional partners will enable the region benefit in trade.

“The Permanent Secretary also recalled the 2013 Summit Directives of the Partner States of NCIPs that agreed to among others, undertake infrastructure development projects in coordinated mechanisms within the Northern Corridor countries for the economic growth and development of the region,” the statement added.

The chairperson of Kampala City Traders Association (Uganda), Mr Thadeus Musoke Nagenda, welcomed the development, saying it is going to ease trade between the two countries.

“This is a good development. Our traders have been losing a lot of money because of those fees. Now that the fees are going to be removed, it gives us hope that there is going to be promotion of businesses,” Mr Musoke said.