Construction of the first berth of the Mombasa Special Economic Zone (SEZ) is expected to start in 2016 as Kenya prepares to launch its logistics and industrial hub in the coastal city.

The berth construction, expected to take three years, will be done parallel to the development of the free port, a free trade zone and setting up of the initial industries in the 3,000- acre owned by the government.

The SEZ to be located in Dongo Kundu is the government’s attempt at creating an economic engine in the region and a regional production hub.

“The port provides logistics functions directly linked to the special economic zone and to be developed by KPA (Kenya Ports Authority) on the opposite shore of the existing Mombasa port,” says the SEZ Strategic Environmental Assessment report presented to the National Environment Management Authority (Nema).

“The port facilities such as berth, container yard, container freight station, gantry crane and cargo handling equipment will be installed and offer the key function as the logistic gate of Kenya as well as EAC and beyond.”

The report shows that the SEZ will be divided into multiple zones which will include the port itself and the free port— a bonded area next to the port in which imported goods can be exempted from duty.

In the free trade and industrial zone, businesses will enjoy relaxed regulations and exemptions from certain taxes.

“In particular, manufacturers importing raw materials and producing goods in SEZ, and exporting them at port will be able to trade goods at a globally competitive price as a result of reduced handling time and cost,” the report adds.

“In the free trade zone, the light industry such as packaging will benefit from lower tax compared to tenants in industrial park.”

The targeted industries include steel mills, machine and motor vehicle assembly, pharmaceutical industries, mineral processing and light industries like agro-processing and furniture making.

These labour intensive industries are expected to create thousands for jobs for the area and county residents.

Other planned zones include an enterprise area, a zone for business-based tourism (meetings, conferences and exhibitions), a residential area and a utility area for a power substation and other common utilities.

The Mombasa Southern bypass road is expected to be completed by 2018 and will be the link between the SEZ and Mombasa city.

It is expected that construction of the second berth will commence in mid-2022 with development of the various zones being undertaken in phases.

The SEZ is planned to be fully operational by 2030.

The Mombasa county government is expected to provide the external infrastructure and service for transportation and sanitation as the fully functioning SEZ will attract sizable population exerting considerable pressure beyond its confines.

Source: Business Daily

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