Kenya’s growing importance as a global hub for trade explains why the nation has been experiencing the fastest rise in foreign direct investment in the continent.
Thrust on perishables exports According to a recent report, Kenya earned much more from flower and other perishable exports in the last three years than before. “The earnings from exports are slowly growing and a promise of a better future.
A number of multinational freight forwarders are acquiring Kenyan companies to tap into the lucrative perishables market. Recently, the world’s third largest logistics company, Japan’s Nippon Express, launched a subsidiary office in Kenya. Nippon Express has been making use of local agents for the export of home-grown (Kenyan) cut flowers and roses.
The firm announced that it will be putting in place a structure to meet the needs of customers in Kenya and the rest of East Africa, where sustained growth is expected.
Tapping into the vast potential in the Kenyan perishables market, global freight forwarder and logistics group Panalpina acquired Kenya-based Air Connection last year, this follows Panalpina’s acquisition of another Kenyan perishables forwarder, Airflo, which was completed in 2016. Air Connection’s perishables business has operations near Jomo Kenyatta International Airport in Nairobi and in Mombasa, and is now merged with Panalpina Airflo. With this acquisition, Panalpina Airflo’s combined cold-storage capacity will increase to 4,200 square meters as the combined business expects to handle about 70,000 tonnes of perishables airfreight per year. The company has also begun construction to increase its cold-storage space in a project that should be completed by 2018, according to the company statement.
KQ Direct US flights
Now that Kenya Airways (KQ) has finally been cleared to make direct flights to the United States, the move is expected to help the airline grow revenues as well as enable local industries increase exports to the American market and boost tourist numbers from the key source market. Direct flights between the two countries will open a window of opportunity, especially to Kenya, with the US being one of Kenya’s largest trading partners.
Last year, Kenya exported Sh43 billion worth of goods to the US. In return, America imported Sh47 billion worth of goods. Kenya hopes to increase the amount of goods exported to the US market, especially through the African Growth and Opportunity (AGOA) window, which exempts from taxes, certain goods from some African countries including Kenya.
Emirates carried 28K tonnes of Kenyan flowers
Emirates SkyCargo transported 28,000 tonnes of flowers from Kenya in the year 2017-18. This volume was transported in the 12 months since the launch of Emirates’ offering for perishables – Emirates Fresh.
Since April 2017, Emirates SkyCargo has carried close to 400,000 tonnes of perishables under the three different Emirates Fresh service categories.
Fruits and vegetables were the largest category of perishables transported by Emirates SkyCargo. In the last year, the air cargo carrier transported over 150,000 tonnes of fruits and vegetables globally. More than a fifth of the total volume of fruits and vegetables carried on Emirates SkyCargo were transported from India. Nearly half of the fruits and vegetables from across the world were imported into the UAE, which has a thriving international food scene catering to a large expatriate population. With the onset of the export season for mangoes from the Indian subcontinent and the start of Ramadan, Emirates SkyCargo will be going through one of its busiest seasons in the year for transport of perishables from May 2018 onwards.
Over 50,000 tonnes of fresh flowers and plants were also transported on Emirates SkyCargo between April 2017 and March 2018. This includes flowers transported directly from some of the world’s most important flower producing regions such as Kenya and Ecuador on freighters to Amsterdam – the hub of the global floriculture market.
“Since its launch last year, we have received extremely positive feedback on Emirates Fresh from our customers,” said Nabil Sultan, Emirates divisional senior vice president, Cargo. “The three different service levels of Emirates Fresh allow us to respond to the varied needs of perishables exporters. We continue to work with our customers and to invest in and develop Emirates Fresh as well as our other sector specific offerings. This is what helps us stay ahead of the game,” he added.
Turkish Cargo keen on Kenya
Turkish Cargo attended the IFTEX (International Flower Trade Expo), held in Nairobi, the capital of Kenya, one of the prominent flower producers of the world.
Having attended said exhibition, which is attended by more than 120 flower producers and international flower buyers on yearly basis, Turkish Cargo held meetings with various producers and buyers, and hosted Mr. Ahmet Cemil Miroglu, the Ambassador of Turkey in Kenya. Some conversations were held with the Esteemed Ambassador in respect of performance of effectual logistic activities for the floriculture industry.
Turkish Cargo operates direct air cargo shipments for 7 days a week to Nairobi, to which flights (pax) are operated also by Turkish Airlines on 7 days basis. The flowers, arriving at the cargo terminal by air-conditioned vehicles, are shipped at 2°C + 8°C. If and when vegetables and fruits are also transported within the same shipment, then the flowers are loaded in different compartments in order to avoid the flowers becoming affected by the ethylene gas, generated by such fruits and vegetables, during the flight, and thereby, any and all actions and measures are taken as required.
Rail infrastructure gains steam
Kenya Railways Corporation, a government-owned rail operator, launched its cargo service on the new Standard Gauge Railway (SGR) in January 2018. The new Standard Gauge Railway (SGR), also called the Madaraka Express, connects Mombasa Port, the largest port in East Africa, and Nairobi. This 472km-long line is the first phase of the SGR project that aims to connect Kenya, Uganda, Rwanda and South Sudan and create around 30,000 jobs during construction.
