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IMO wants port staff designated as offering essential services

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Shipping & Logistics

IMO wants port staff designated as offering essential services

Workers at the Port of Mombasa
Workers at the Port of Mombasa. FILE PHOTO | NMG 

The International Maritime Organisation (IMO) has called on United Nations (UN) system agencies to support its bid to categorise seafarers, port personnel and maritime workers as crucial key personnel to ensure they are not limited in their movements and to ensure ships deliver goods on time during the coronavirus (Covid-19) pandemic.

IMO Secretary-General Kitack Lim has asked all countries especially port states to include the group among those offering crucial services and by doing so, ship delays will be cut significantly during this period.

Addressing other UN chiefs and the UN Secretary-General António Guterres during virtual meeting last week on the impact of Covid-19, Mr Lim said among other things, disruption and restrictions to travel of such groups has affected trade flows, global logistics, supply of food, pharmaceuticals and medical equipment.

“Since Covid-19 was declared pandemic, major travel restrictions to crew are being increasingly imposed by governments, this has caused ship delivery delays and its a big concern to us, especially those offering essential goods,” he said. He added, “Seaborne trade is still flowing but challenges are growing due to restrictions being introduced by port States.”

Mr Lim highlighted the importance of welfare and well-being of maritime personnel and particularly seafarers and the significance of crew changes to support the global supply chain.

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The organisation has made a series of recommendations for governments and relevant national authorities, proposed by a broad cross-section of global industry associations representing the maritime transportation sector.

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The circular letter specifically calls on governments to designate professional seafarers and marine personnel, regardless of their nationality, as ‘key workers’ providing an essential service. Referring to the issue of crew changes, it says professional seafarers and marine personnel should be granted any necessary and appropriate exemptions from national travel or movement restrictions to allow them to join or leave ships, and that governments should permit professional seafarers and marine personnel to disembark ships in port and transit through their territory (that is, to an airport) to allow crews to be changed and seafarers to be repatriated.

In the Circular Letter, the Secretary-General referred to the outcome of the G20 Leaders’ Summit on Covid-19 on 26 March 2020, in which the G20 leaders committed to continue working together to facilitate international trade and co-ordinate responses in ways that avoid unnecessary interference with international traffic and trade.

Mr Guterres stressed the need for coordinated global, but also regional and local, approach to address the crisis and appealed to all UN-system agencies to work together.

More than 34 countries out of 54 in Africa have imposed full border closure while some having introduced partial lockdown and curfews. During this period, only groups categorised as offering essential services are allowed to freely conduct their businesses. In Kenya, for instance, the Kenya Ports Authority (KPA) workers, seafarers and maritime personnel are not categorised under this group hence they are limited to travels hence causing ship delays.

Due to this, operations at the port of Mombasa have been scaled down with workers only operating between 6am to 4pm thus affecting time of ships delivering cargo at the facility due to delayed clearance of vessels.

The KPA management has since cut the number of shifts from four to two and has also asked the majority of staff to work from home since March 27 when the 7pm-to -5am curfew was imposed.

Operations at the Port of Mombasa may be reduced further this week after two more KPA staff tested positive for Covid-19 apart from the one who succumbed to the disease a week ago.

Acting KPA Managing Director Rashid Salim has confirmed in a letter seeking accommodation at Bandari Maritime Academy to quarantine 16 staff who were identified as having interacted with one of the patients.

“The KPA has had two of its staff test positive for the Covid-19 and it has therefore become necessary that 16 other staff who were working with one of the affected to quarantine,” read a section of the letter.

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Kenya set for trade talks with Britain

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Economy

Kenya set for trade talks with Britain

United Kingdom
United Kingdom Prime Minister Boris Johnson. FILE PHOTO | NMG 

Kenya will soon start negotiations on a second bilateral trade pact with the United Kingdom following its exit from European Union (EU).

The two countries have previously been trading through the EU. However, Kenya lost market access after Britain left the union in what was known as Brexit.

Under the EU, Kenya benefited from duty-free and quota-free market access to all member states for industrial and agricultural products, including beef, fish, dairy, cereals, fresh and processed fruits and vegetables.

The talks mean Kenya and the UK will have to renegotiate the terms for a trade pact.

The announcement comes after the government kicked off negotiations for Kenya-US bilateral agreement on July 8.

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“Kenya will also be launching a bilateral agreement with the United Kingdom following their exit from the EU in the coming days,” said Trade secretary Betty Maina said during the launch of the Sunquick Fruit Drink Concentrate production line at BidCoro Africa last week.

The Brexit heightened debates on its impact on Kenyan trade ties and investments, with analysts claiming it would result in major loses to the country.

Kenyan exports to the UK were recorded at Sh40.08 billion in the 12 months to December 2019, representing 30 per cent of Sh133.39 billion total exports to the EU in the period.

Kenya National Bureau of Statistics data shows the volume of trade between Kenya and EU in the first three months, which excluded the UK after exiting the union in February 2020, was valued at Sh94.35 billion compared to Sh106.13 billion recorded in a similar period in 2019.

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Factories risk fine for illegal tea buying

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Economy

Factories risk fine for illegal tea buying

A tea picker in Gathehu Village
A tea picker in Gathehu Village, Nyeri County. PHOTO | JOSEPH KANYI 

Tea factories risk Sh10 million fine for buying and ferrying produce from unregistered small-scale growers in a proposed law that seeks to weed out hawking.

Amendments made to the Tea Bill of 2018 in the National Assembly introduces penalties for factories that buy the commodity from unregistered farmers or dealers.

Those in breach face a fine of Sh10 million, a 10-year jail term or both.

The penalty is expected to limit against tea hawking and theft of the crop in farms, which has ultimately hurt farmers’ earnings.

“A person commits an offence if the person manufactures tea for sale in contravention of this Act, buys, sells, offers for sale, transports or has possession of tea, which to the person’s knowledge or belief has been grown, manufactured or processed otherwise than in accordance with this Act, is from a non-registered grower or dealer of such crop,” says amendments to the Tea Bill.

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“A person who commits an offence under subsection (1) shall be liable, on conviction, to a fine not exceeding ten million shillings or to imprisonment for a term not exceeding five years, or both.”

Tea Bill of 2018 was passed by Senate last year and is now before the National Assembly because it also affects the National government.

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Theft of the tea leaves through break-ins at factories and illegal plucking on the farms are some of the biggest challenges facing the sector.

Farmers in Bomet and Kericho counties have been grappling with theft of tea at night since last year as thieves target the green leaves that are in turn sold to other factories.

Brokers have also been buying the crop from farmers on the cheap for sale to factories, depressing farmers pay.

The stiff penalties come amid growing concerns of farmer exploitation where tea growers continue to grapple with diminishing earnings due to exploitation by unscrupulous traders and factories.

Lawmakers have also directed that tea growers provide all information to the factories to weed out those who have scaled up to growing the crop on large-scale.

The proposal is meant to kick out cartels buy tea from farmers and sell it to factories, purporting it has come from their farms.

Farmers who will fail to provide updated information that includes the size of their farms risk a Sh1 million fine or two years in jail if found in breach of the requirement.

Tea sector has in recent years hit lows mainly on diminishing returns to farmers with the State targeting the giant Kenya Tea Development Agency (KTDA) in reforms meant to increase farmers’ earnings.

President Uhuru Kenyatta earlier in the year ordered an overhaul of the giant KTDA that manages 69 tea factories — processing and selling tea on behalf of the 612,000 small-holder growers affiliated to it.

Lawmakers have also set their eyes on plantation tea farmers and imposed a Sh2 million fine or two years in jail on all growers who fail to register their factories with the yet to be established Tea Board of Kenya.

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Equity Group eyes Sh50bn long-term debt in three years

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Companies

Equity Group eyes Sh50bn long-term debt in three years

Group CEO James Mwangi
Group CEO James Mwangi. FILE PHOTO | NMG 

Equity Group #ticker:EQTY is eyeing up to Sh50 billion from international financiers in the next three years as it seeks to boost its liquidity and capital positions.

Group CEO James Mwangi told investors in a recent virtual annual general meeting that the board wants to reinforce the lender’s liquidity and capital positions through a mix of medium-term and long-term debts.

This will take the group’s borrowed funds beyond the Sh56.7 billion it has in its books at the end of December 2019. Borrowing stood at Sh45.1 billion in the preceding financial year.

“We anticipate we shall be able to get up to Sh50billion of liquidity through debts as it was demonstrated by World Bank releasing Sh5 billion to help us support SMEs,” said Mr Mwangi.

Equity’s Sh22.89 billion loan or about 40 per cent of its current borrowings will mature by March 2023, the information in its latest annual report shows.

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The Kenyan banking subsidiary of Equity Group is in line to receive a $50 million (Sh5.3 billion) loan from International Finance Corporation (IFC), the private sector arm of the World Bank.

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The IFC money, a senior debt, will be used for onward lending to small businesses hurt by the global Covid-19 pandemic.

Equity has taken a cash preservation strategy in the wake of Covid-19, including recalling Sh9 billion in dividends and dropping the purchase of four banks outside Kenya.

“Forfeiture of dividends was a good gesture to all our partners that we are also in need as we called on them to support our customers,” Mr Mwangi told investors.

He said the bank had taken a proactive management strategy of preserving capital and liquidity as the group anticipates Covid-19 and its impact to last for at least 18 months.

Equity had borrowed a cumulative Sh17.4 billion from IFC as of December 2019, making it the largest lender to the group.

The upcoming credit line will raise the total to Sh22.7 billion.

Other top lenders include the African Development Bank (Sh10.7 billion), KFW Deg (Sh10.4 billion), ResponsAbility (Sh2.56 billion) and European Investment Bank (Sh2.34 billion.)

Local banks are increasingly taking substantial loans from global funds such as the IFC, European Investment Bank and Agence Française de Développement, attracted by relatively more favourable terms of the debt including lower interest rates and longer maturity.

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