South Sudan has suspended a deal with Nairobi Freight Terminal that had been given exclusive rights to handle all its cargo passing through the Port of Mombasa.
In a letter dated July 28, South Sudan Minister for Transport Madut Biar said the arrangement had led to an increase in freight rates, charges and delays in clearance of cargo that had resulted in skyrocketing prices of goods in his country.
“Concerns of the business community and general outcries from consumers of high prices in the markets were discussed in South Sudan Parliament on July 26, 2022,” said Mr Biar, adding that a committee would be established to look into the issue afresh. Mr Biar said in a letter to Transport CS James Macharia that South Sudan Parliament resolved that the directive to deliver cargo through Nairobi Freight Terminal be suspended.
According to the list released by the South Sudan Commissioner of Customs Mr Akol Madut, the companies that were to clear that country’s cargo are Safina Merci Company Limited, Met Connection International Company Limited, Nimbus Company Limited, Safinass Company Limited, Le Comex Afrique Limited, and Manzil Developers Company Limited.
In a letter dated April 25, addressed to Kenya’s Commissioner of Customs and Border Control Ms Lilian Nyawanda, Dr Madut said the said six firms were authorised to handle all South Sudan cargo moved to the Nairobi Freight Terminal.
“This authorisation applies to and covers all goods that are transported through Nairobi Freight Terminal, arriving on trucks or rail but destined for South Sudan and this authorisation remains valid, subsisting, and continues until revoked. Further to that, this supersedes all previous authority letters issued in respect of authorising other companies to clear goods destined for South Sudan,” wrote Dr Madut.
On June 13, the Association of South Sudan Manufacturers (ASSM) wrote to the Trade and Industry CS expressing disappointment at the cargo haulage order, noting that it would raise transport cost by $1,500 (about Sh175,500) per container following double handling in Mombasa and Nairobi, as well as rail charges. ASSM chairman Adam Kubanja argued that most traders and manufacturers in South Sudan had invested in trucks to transport cargo, but were forced to pay extra costs for transportation by rail to Nairobi.