Business & Economy

Work to begin on Kenya’s ambitious LAPSSET project

Artist's impression of Lamu Port
Artist’s impression of Lamu Port

Kenya will begin work this month on a massive regional infrastructure project – the Lamu Port-South Sudan-Ethiopia Transport (LAPSSET) project—that stands to turn the country into the East African energy hub. The project will include a port, new roads, a railway and a pipeline that, by 2030, will give landlocked South Sudan and Ethiopia access to the Indian Ocean. The project is estimated to cost about $25.5bn. In 2013, officials said a consortium led by China Communications Construction Company had won a $449 million contract to build the first three berths of the port.
The port of Lamu will be key in resolving the issues of congestion and delays at Kenya’s main port of Mombasa, which the facility has been facing in recent years. The port of Lamu will aid Kenya’s port of Mombasa, which has been suffering from congestion and delays for some time, with the facility operating well above its annual 250,00TEU capacity. Although Mombasa is itself undergoing expansion, it is hoped that the development of the port of Lamu will relieve congestion and avoid losing out to regional rival the port of Dar es Salaam, Tanzania. Mombasa and Dar es Salaam are in fierce competition with each other due to their proximity and do not only serve Kenya and Tanzania but also act as maritime gateways to the Eastern African hinterland countries of Uganda, Rwanda, Burundi, Malawi, Zambia, the Democratic Republic of the Congo and Southern Sudan.
Although Mombasa has become well known for the delays faced by shipping lines at its port, the facility’s container throughput has historically gone from strength to strength. Between 2008 and 2012, Mombasa’s container throughput expanded by 46.7 percent, an annual average increase of 9.2 percent, reaching a throughput level of 0.9mn TEUs in 2012. Despite Mombasa operating way above capacity, the future is bright for the port’s container throughput over the medium-term, when project throughput levels is projected to expand by 58.4 percent, an annual average increase of 12.4 percent, to reach 1.62mn TEUs.
The development of the port of Lamu as part of the LAPSSET project will be key in relieving the congestion witnessed at the port of Mombasa. This will not be the only benefit of the LAPSSET Corridor. Kenya’s role as a maritime gateway for goods into the landlocked countries of East Africa, and LAPSSET boasts a transport network that will ensure Kenya is able to maintain this role and gain a strong reputation as a port of call for goods into the landlocked East African hinterland.

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