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THE STANDARD GAUGE RAILWAY A BOOST FOR THE REGION’S ROAD TRANSPORTERS

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The Standard Gauge Railway (SGR) is a flag ship project under Kenya’s Vision 2030 development blueprint that seeks to simplify passenger and cargo transport cost effectively across the Mombasa – Malaba. The Kes. 327B railway line is designed to carry 22 million tonnes a year of cargo (approximately 40% of the Mombasa Port throughput) by 2035. The freight trains will have a capacity of 216 containers ferried at an average speed of 80 km/h. The SGR project is proposed to connect Kenya, Uganda, Rwanda and South Sudan. Ultimately, the SGR will inch Kenya closer to the vision’s ambition to make Kenya a middle class economy by 2030. The construction of the 473 kilometres line commenced in October 2013, and latest reports from the Ministry of Transport determine that the railway will be ready for use ahead of its December 2017 deadline.

Contrary to public opinion, the SGR will provide a much needed boost to road transporters in Kenya. The SGR is predicted to enhance efficiency and reduce the time and cost of cargo movement from the busy Mombasa Port. The global standard for cargo freight logistics is 60-40 in favor of rail. However, due to current inefficiencies in the rail system, Kenya is yet to achieve this standard. Job Kemboi, the General Manager in Siginon Global Logistics Tanzania says “The SGR is not a threat but a complement to road transporters. The SGR is most suitable to handle containers destined to Kenya, Uganda, Rwanda and Burundi.”

Currently, the Kenyan transport industry consists of approximately 15,000 trucks that are at times over whelmed by the amount of cargo discharged at the port of Mombasa for onward road transportation to serve customers along the Northern corridor and the hinterland. The SGR will provide an advantage of fast and efficient cargo movement. Along the Mombasa –Nairobi stretch, the SGR will move cargo in 8 hours from destination, a trip that would often take 2 – 3 days if one was using the current rail network. This will lead to the reduction in the cost of transport and ultimately reduce the cost of doing business in Kenya. In addition, with faster movement of goods, there is enhanced cargo security due to reduced handling and exposure while on transit. Job Kemboi adds; “Once the new railway line is in place, it will offer a secure, cost effective and efficient cargo solutions. For us, we will be delighted to ensure our customers benefit from SGR as an alternative to their logistics needs.

With the reduction of trucks plying the Mombasa – Naivasha highway, more trucks will focus on serving customers in the hinterland, away from the Northern Corridor, this will likely result in reduced traffic jams particularly on the Mombasa – Nairobi stretch, which is often been blamed on cargo trucks in the course of business. Siginon Global Logistics is one company that has recently acquired over 100 trucks due to the increased demand for cargo transportation. The additional trucks are a testament to the confidence that truck operators have in their business despite the SGR commissioning. Job adds “We have a number of customers who are located inland, away from the Northern corridor who will still need road transportation. We are confident that the SGR is a partner and not a threat to road transporters.”

It is envisioned that the SGR comes with additional benefits not only for transporters but the regions macro economy. For instance, due to the various stations established along the Northern corridor myriad of employment opportunities will arise with the stations’ construction to running and maintenance. Areas that are positioned around these stations will likely see the development if towns leading to growth of economies and infrastructure development

Job concludes, “Once the new railway line is ready, we expect to have cost effective and more efficient movement of goods and services along the northern corridor. It’s not really about us but about the customer and we are in a position to offer all options.”

 

 

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KENYA’S LOGISTICS INDUSTRY TURNS TO TECHNOLOGY TO BOOST CUSTOMER EXPERIENCE

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Adoption of technology has greatly enhanced the competitive advantage of most organizations. The multiple technology options available deliver customer satisfaction through offering the customer convenience, quick responses, customized solutions and efficient reporting of important information without the need for major human intervention.

The move towards adoption of technology move has seen players in the Kenyan logistics industry embrace digital technology to boost their customers’ experience and build customer loyalty. In Mombasa, Chris Kanoti of Siginon CFS, adds that “We have put in place a broad spectrum of technology that will create a positive customer experience while they’re using our services”. To support efficiency in cargo clearance, Siginon CFS provides her customers with free Wi-Fi services. This enables the customer to access free internet connection through various devices and access documentation required in the clearance of their cargo from the port of Mombasa. Kanoti states; “We realized that our customers need to access the internet frequently to access and lodge the various clearance documents for their cargo. To assist in making the process more efficient, we provided our customers free Wi-Fi to eliminate the need for them to step out to access the single window system in cyber cafés away from the CFS and make our premises a convenient cargo clearance CFS.”

Container Freight Stations (CFS) have also adopted the CFS Pro system to assist in handling containers aboard the various vessels while they’re docked at Mombasa port. The system shares vessel schedules and cargo manifests to the customer via the CFS system. The system facilitates efficient cargo clearance by proactively providing the customer with the cargo manifests thus allowing them to prepare all documentation for clearance and avoid storage charges. Chris asserts; “We are focused on providing our customers with a stress free cargo clearance experience, thus we are proactively providing all the vessel and cargo information so that they are spared the various storage and demurrage penalties resulting from delays in clearance which are sometimes caused by getting this critical information on time.”

The Single Window system launched by Kentrade, an arm of the Kenya government that is mandated to facilitate cross border trade and enhance Kenya’s global competitiveness is also web based. Job Kemboi, the Siginon Global Logistics Divisional Manager states; “The single window system has greatly enhanced the efficiency of clearing and transporting of shipments from the port of Mombasa to the local market as well as those destined for transit. Operationally, it has improved the turnaround times for trucks as there are no delays at the Kenya –Uganda Malaba border as duties are paid up front and exit note issued prior to departure. The reduction in delays has enabled us to make more trips as well as reduced congestion at the border posts and the port”. The Single Window System is an outcome of Kenya’s Vision2030 development blue print that seeks to enhance international trade through encouraging efficiency at the port of Mombasa. Job concludes, “Our customers have also enjoyed the benefits of the Single Window as they are guaranteed their cargo will arrive as expected due without the border delays. This has helped them plan their production schedules as well as make ‘just in time’ orders”.

In line with current market trends, mobile payments have been adopted at both Siginon Global Logistics and Siginon CFS to enable cash less payments for the logistics transactions. Job states “We are accepting mobile payments for fees due to be paid to Siginon. We’ve realized that most customers avoid carrying cash preferring the mobile payment options. Mobile phone payments have proven to be safe and secure and convenient for our customers. We are also paying our drivers allowances through mobile money as they make their various trips.”

The Kenya government has taken conscious steps to embrace technology through the E-government initiative that involves employing ICT to transform both back end and front end government processes in service delivery.  This has encouraged players across the various industries to equally incorporate technology in their operations so as to achieve efficiency, offer the market convenience and achieve global competitiveness.

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DIRECT US – KENYA FLIGHTS WILL BOOST THE AIR CARGO INDUSTRY IN KENYA

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The Kenya air cargo industry stands to experience tremendous growth should direct US – Kenya flights get commissioned. The flights would offer an advantage over the current connecting flights to various airport hubs all over the globe. Coming fast against the back drop of the recently concluded Global Entrepreneurship Summit 2015 (GES 2015) there were many expectations from the United States goody bag issued by the President Barack Obama, amongst these expectations were the commissioning of the direct flights.

Jared Oswago, the Divisional Manager at Siginon Aviation adds; “In Africa currently, there are direct flights between Senegal and South Africa to various US cities. Bringing these US – Kenya direct flights is bound to attract other airlines and more business to Kenya and the region. It is likely that a direct US –Nairobi flight is likely to operate between Nairobi and New York or Washington DC.”.

Kenya is largely importing medical engineering equipment, industrial products, air craft engines and chemicals while largely exports textiles and perishable products such as flowers and vegetables. The export of textiles has largely been supported under the African Growth and Opportunity Act (AGOA) initiative through the various Export Processing Zones (EPZ). Jared adds; “Currently, we’re exporting cargo to the US through various connecting flights. The multiple connections make the trip longer and compromises on on-time performance as there may be connection delays, missed connections   handling in the hubs exposes the cargo to mishandling which at times may reduce or degrade the cargo quality. The cases of pilferage are also prone in the connections.”

 Security concerns have also made it imperative for the players to adopt heightened security measures in their operations as well as evolve into a ‘know your customer’ regime. This involves tracing the cargo right from its source. In the case of perishables cargo this involves interrogating farm produce from where it’s grown or the origin of the meats up to where it reaches the final customer. As a response to market demands to ensure high security levels in air cargo operations Siginon Aviation recently launched operations in its new USD 10 million air cargo terminal in Jomo Kenyatta International Airport (JKIA), Nairobi. The state of the art terminal meets global security standards and has been tailor made to satisfy customer air cargo demands. These stringent security conditions ensure that the cargo ferried from the source up to the final consumer remain safe and fit for consumption. Jared asserts “Our new operation at Siginon Aviation has adopted the latest security technology such as cargo screening machines and located on the airport apron to ensure high security. Our staff undergoes rigorous safety and security training to enable them to professionally handle flights bearing various cargo including those considered dangerous goods or DGR. We have also received various international certifications such as RA3 set by the European Union and IATA Safety Audit for Ground Operators (ISAGO) to highlight our compliance to global safety and security standards in our operations.” Siginon Aviation has been passed to handle various flights plying the US – Nairobi route.

The Siginon Aviation terminal further has placed physical barriers such as manned gates and 24/7 CCTV surveillance as well as access control to ensure the warehouses remain ‘sterile’ and restricts access to only authorized individuals and vehicles. These measures have served as a deterrent to criminal elements and have boosted customer confidence in the services offered.

The Siginon Aviation perishables centre comprises of a unique express corridor that maintains perishable cargo in the specified cool temperatures up to a few minutes prior to loading on to the air craft. Jared concludes “This is a unique service we offer as most of our competitors would expose the cargo to the unfriendly temperatures while awaiting loading onto the air craft. However, our express corridors ensure that the temperatures are maintained as specified and preserve the quality and condition of the perishable cargo until it is loaded in the aircraft”. The express cool corridor can take up to 100 units of palletized cargo and assures her customers that the cargo is maintained in the required

temperatures.

Siginon Aviation forms part of the other 4 air cargo terminals available in Jomo Kenyatta International Airport. Siginon also has another air cargo terminal located at the Eldoret International Airport.

 

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EFFICIENT LOGISTICS KEY FOR THE KENYA-FAR EAST PARTNERSHIP TO THRIVE AND POSITIVELY IMPACT THE KENYAN ECONOMY

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By Meshack Kipturgo,

An efficient logistics chain remains one of the key tools for competitive advantage to be exploited in a growing economy such as that of Kenya. Every thriving economy relies on a backbone of an efficient supply chain that nurtures global trade and embraces global competitiveness.

Efficient logistics is a key contributor to a country’s global competitiveness. Various countries have gained trade muscle and boosted their economies by fully taking advantage and effectively controlling the supply chain to ensure that it nurtures and positively impacts global trade. For instance, Singapore despite being a small country boasts of being the most efficient country in logistics it is no wonder that in the 2011 World Bank Ease of Doing Business Index Singapore was ranked as the best country in the world to do business. Japan has cut its niche as the manufacturer of popular automobiles and electronics globally. Japan is home to 6 of the top 20 largest vehicle manufacturers, with Toyota being the highest sold vehicle globally.

Currently, Kenya in search of diversity amongst her trade partners has set her sights on the east. Asia is the fastest growing economic region and the largest continental economy by Gross Domestic Product (GDP) in the world. China is the largest economy in Asia and the second largest economy in the world.  In addition, Asia is the continent with the highest population with China carrying over 1 billion inhabitants. The potential trade and impact into the Kenyan economy as a result of this new trade partnership is immense. However, the question begs, does Kenya have the capacity to reap the fruits of doing business with this trade giant?

On the Kenyan logistics front, key concerns include existence of the non-tariff barriers, state of infrastructure, security and the rising cost of fuel among others. In Kenya, the high cost of goods is to a large extent attributed purely to logistics. These are critical concerns that have directly impacted the cost of doing business in Kenya and threatened Kenya’s position as the regional business hub in East Africa. Neighboring countries such as Tanzania, Uganda and Rwanda have identified this gap as well and they are working on overdrive to sway investors into their markets by embarking on great infrastructural developments such as the construction of the USD 11B Bagamoyo Port, USD 164 new airport terminal in Tanzania as well as the Tanga-Musoma railway while Rwanda is pursuing investment in the air cargo industry including an airport free trade zone. All these initiatives are set to shift trade flow away from Kenya. Surely, Kenya should not be caught napping.

Thankfully, there are steps that the government has taken to expand our current infrastructure as well as regional partnerships that would smoothen trade amongst the East African community partners. Notably, the recently launched single window system, standard gauge railway, infrastructure development and expansion particularly at the port of Mombasa and the JKIA airport. However, to effectively tackle the current and emerging demands from our international markets the Kenya market needs to provide a safe and convenient environment for doing business to its potential investors. Some interventions include; building a dual carriageway on the Northern Corridor beginning from Mombasa all the way to the Malaba border. Partner countries in Rwanda and Uganda should also be convinced to extend the same dual carriage way. At the same time, there’s need to fast track the construction of the free port to enable Kenya to meet the demands of the growing markets. An airport free trade zone would also greatly boost our air cargo logistics. Regionally, it is prudent that the East African countries partner and negotiate with the global markets as one. Going it alone would overwhelm or literally exhaust the limited resources among these countries.

In the meantime, tackling the current trade hindrances while planning in the long term for business growth will go a long way into attracting more investments in Kenya as well as for East Africa as a vibrant trading region. In the longer term, innovative ideas should be considered for serve Kenya’s traditional markets from the west and the Asian markets.

Meshack Kipturgo is the Managing Director of Siginon Group, a source to doorstep logistics provider offering transport, warehousing, customs clearance, ground handling and container freight station based in Kenya, Uganda and Tanzania. Meshack also serves as the Chairman, Container Freight Station Association (CFSA) and Executive director in Shippers Council of East Africa.

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GLOBAL TERRORISM MAKES SECURITY A CRITICAL COMPONENT IN CARGO HANDLING.

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Global terrorism has now more than ever more created an urgent need for more stringent security measures to avert this threat. Players in the cargo industry are now taking proactive steps to seal security loop holes in their operations by adopting systems and processes that hinder the chances of terror activity in the cargo they handle and within their premises. Moses Wahome, the Siginon Aviation Divisional Manager states “Security is a supply chain issue. The cargo vigilance has extended to verification of the cargo source. For instance, in the case of flowers we want to verify the cargo right from the farm through to the airline and onto its final destination so as to fully secure the cargo chain. The default action is more on pre-empting and preventing security lapses than on curative responses. There’s a lot more profiling moving players to a ‘known shipper regime’ with a preference of individuals who are regulated agents.”

In as much as the threat to security remains vivid today, cargo handlers are more preoccupied with mitigating the myriad of risks involved in their daily operations. The impact of this pre occupation has led most companies to invest more in security related manning and equipment such as access controls, thorough cargo screening and detection of explosives.  David Kiptum, Siginon Aviation Safety and Security Manager asserts “Safety and security remain the focus of cargo processing. We are aware of the threats and we are putting in place measures that are commensurate amongst our staff and also we are acquiring supporting security equipment”.

Siginon Aviation, a ground handler recently opened a new USD 10 million cargo terminal in Nairobi’s Jomo Kenyatta International Airport (JKIA). The state of the art facility boasts of high standards in security to ensure high standards of safety and security in their operations. Moses asserts that security has become an overriding factor in service delivery; “With this new terminal, security is greatly improved. We regularly conduct security risk assessments so as to also tighten all loopholes.” This security awareness has extended to regulators and airline customers who frequently audit ground handlers to gauge the level of security preparedness. David adds; “The JKIA stakeholders have heightened their security awareness to ensure the sanctity of their cargo operation. This is reinforced through elaborate security equipment and rigorous staff training programs that have been put in place to ensure vigilance on security matters. The general security awareness has greatly contributed to a reduction in security incidences” The Siginon facility is equipped with high end security equipment including x-ray machines, advanced CCTV systems and explosives detecting equipment. Operationally, the Siginon staff undergo regular security training, conduct 100% cargo screening including placing strict controls on the access to the airport airside adjacent to the Siginon facility. David adds; “Customer confidence and the general business environment has also improved following the high levels of cargo security.”

David concludes “Terrorism is a global problem that is being collectively handled by all stakeholders. All the players at JKIA have taken the responsibility to play their role in tackling this issue. We are having frequent engagements comprising of the regulated agents, law enforcement agencies, airport operators, catering, airlines, Civil Authorities and other government agencies and regular information sharing to enhance our operating environment and nurture business.”

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KENYA’S LOGISTICS INDUSTRY BOOSTED BY INFRASTRUCTURE PROJECTS IN THE REGION

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The growing East African economy has drawn interest from various multi nationals keen on taking a piece of the infrastructure development pie. Infrastructure wise, the Kenyan budget is the highest within the East Africa region at USD 40 billion which is approximately three times its annual budget. Since 2002, the Kenyan government has taken up ambitious infrastructure projects which in 2008 culminated in the launch of the Kenya Vision 2030 blueprint which seeks to position Kenya as a middle income country by the year 2030. Some of the projects in the Vision 2030 include creation of highways, cities, port expansion, exploiting  of oil and gas all geared to boost and grow the Kenyan economy.

Kenya has looked to the Far East to establish infrastructure development partnerships. China in particular has played a great role in most of the Kenya infrastructure projects through funding as well as in providing expertise and technology transfer. Most notable was the construction of the Thika super highway that was completed in 2012. The 50 kilometre-long highway was funded by the Africa Development Bank (AfDB) and constructed by 3 Chinese firms. The 8 lane highway was built at a cost of Kes. 27 Billion (approx. US$ 330,000,000).

Infrastructure construction and refurbishment calls for importation of a myriad of equipment from key markets considered experts or successful in this area. In Kenya’s case, China was identified as being a key expert in infrastructure development. The logistics of handling the equipment and implements related to infrastructure projects is often referred to as project cargo handling. The handling process largely comprises of clearing and transportation of the infrastructure large, odd sized, heavy, high value or critical goods.Such projects are focused on completion to an agreed standard, contracted time and cost. As such, the logistics around project cargo importation and transportation must ensure that these conditions are adhered to. Lawrence Mangarunyi the Siginon Global Logistics, Divisional Manager adds; “Infrastructure projects are expensive. Project cargo logistics is very sensitive, to the extent that delays in cargo clearance, storage charges or losses cannot be tolerated. All efforts are focused on ensuring that customer’s deadlines are met. It is therefore critical that there is advanced planning and regular communication on all logistics operations. This is through a proactive effort between the customer, the various approval or verification authorities and the logistics provider. The success of a project operation requires that we work as partners with our customers.”

Lawrence further asserts “Due to the nature of imports from various global markets. Siginon Global Logistics is a member of World Cargo Alliance (WCA) whose membership of over 5000 global freight forwarders enables us to collect the cargo from anywhere around the globe and deliver it right to the project site in a safe, cost effective and timely manner.”

As such, various complementing industry sectors have been impacted by this move. The logistics industry in Kenya has seen a spike in business boosted by the increase of imports of project related cargo by air or through sea. Siginon Group, Managing Director, Meshack Kipturgo asserts that the explosion in the project cargo has called for a re-alignment amongst the logistics players due to the opportunity present in the handling of project cargo. For instance, in the Standard Gauge Railway (SGR) project, there is a lot of construction equipment and implements being imported into Kenya to facilitate the construction. Most of the imports are oversized cargo that required specialized equipment as well as well trained personnel to handle the clearing and transportation operations as well as support the customer communication process. Meshack adds “Project Cargo is a key segment that has tremendously boosted the Kenyan logistics industry. To satisfy the needs of our customers in project related business, we have in turn invested heavily in equipment, human resource and systems that are geared to efficiently handle project related cargo.”

Over the years, Siginon has supported a number of Kenyan projects with cargo logistics such as:

  • The Sondu Miriu Hydro Power Project between the years 1998 – 2007.
  • The Turkwell Gorge Hydro Power Project in 1987 – 1991.
  • The Bachuma to Mtito Andei Road project in the years 2000 – 2002.
  • Kiambere Water Dam: 1994 – 1997.
  • China Petroleum Pipeline Bureau- Nairobi – Eldoret Pipeline: 2010 – 2013.
  • Konoicke Water Project – Kapsabet, Narok and Embu: 2010 – 2013

 

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ROAD SAFETY KEY FOR SUCCESSFUL TRANSPORT OPERATORS

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African roads have often been seen as death traps due to the high cases of road carnage. Globally, African countries post the highest accident rates with Kenya’s statistics reflecting an annual loss averaging 3000 lives on the Kenyan roads.

In as much as measures have been taken by the Kenya government to reduce road carnage and enforce sanity on the roads, innocent lives continue to be lost on a daily basis. In response to Kenya’s poor road safety record, transporters have taken proactive measures to provide a lasting solution to preserve road safety. These include; full-fledged safety departments, adopting safety technology as well as running various driver wellness and cargo handling programs to safeguard all road users.

Siginon Global Logistics is a source to doorstep logistics provider that has been in the transport sector for 30 years. Today, Siginon’s transport fleet has expanded its Kenya and Tanzania operations to serve regional customers within the Great Lakes region, East and Southern Africa. The growth of the trucking division has been greatly boosted due to the high safety standards adopted in the transportation division. Job Kemboi, the Transport Manager asserts “All new drivers joining the Siginon trucking team must undergo defensive driving training before they are allowed to proceed on any road trip. It is a mandatory requirement. Through this, we are able to minimize and reduce cases of road accidents that cause loss of life, cargo and the vehicle”

The seriousness of road safety in the transport industry has seen some companies go as far as to establish fully fledged Safety and Security department led by a qualified resource at management level mandated to run a rigorous safety program on the ground. Siginon Global Logistics conduct such safety programs that run throughout the year for all drivers. Mathew Kavehere the Siginon Global Logistics Safety Manager adds, “We have regular safety programs that cater for the drivers’ performance while on the road such as; safety, tool box, defensive and fatigue management meetings for all our drivers. These programs run all year coupled with regular refresher meetings.” In addition, the Siginon drivers are equipped with additional information to cater for vehicle inspection compliance as well as accident preventive maintenance. Due to the varied and delicate nature of the cargo that is ferried by road, the Siginon drivers are further trained on handling of various cargo such as dangerous cargo, lashing equipment and the Electronic Cargo Tracking System (ECTS).

Siginon Global Logistics has also adopted various safety systems and technologies to monitor that all drivers observe high standards of safety while on the road.  These systems are able to track the location of the truck in real time; monitor the speed of the vehicle as well as the driver behavior while on the road. Mathew adds; “We are able to monitor the truck speed by installing speed governors which are limited to 75 km/h which in the interest of safety is 5 km/h less than the statutory speed limit requirement. We can also monitor the position of all our trucks within our operations at any time on a need be basis. We are also able to tell any delays of our trucks both during loading and offloading. In addition, the Siginon fleet management systems are able to monitor the trucking fleet to control or minimize idle time by checking on the driver’s position depending on how long they take at a particular place. Mathew concludes “These systems have managed to help us monitor speed, harsh breaking, truck performance and delays. Also there is a reduction in terms of statistics of various violations and accident since the system was installed. Drivers are also more focused because they know their performance is being monitored and are focused on delivering cargo intact and ultimately give our clients peace of mind.”

Job attributes the success of the Siginon’s positive safety record to commitment by the management team to ensure that there is zero fatality within our business units. “Any road accident or incident is taken very seriously in Siginon. Immediately an accident occurs it is reported to the relevant parties and our Managing Director must be informed within the shortest time possible. Three things must be done immediately, establish the state of the driver, client’s cargo and then our asset which is the truck. The accident is reported to the nearest police station and immediate recovery is undertaken to evacuate the victims in the scene of the accident as well as rescue of the client’s cargo and the truck”

Siginon Global Logistics often sponsors annual road shows on the Northern Corridor between Mombasa and Malaba on road safety in partnership with other industry players and stakeholders. Amongst her peers, Siginon continues to take the lead against her peers on ‘mystery user’ road safety audits conducted by a leading multinational cement company based in Mombasa. The Siginon Global Logistics recently received a safety standard sustainability award by one of her commodity customers due to high safety standards maintained while on the road.

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PERISHABLE CARGO REMAINS KENYA’S COMPETITIVE ADVANTAGE

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Kenya remains one of the most popular countries in Africa in the export of perishable cargo to international markets. Kenya’s climate favors agricultural activity thus nurtures the horticultural sector as one of Kenya’s key foreign exchange earners.  The Kenya Horticultural Council (KHC) states that the horticultural industry is one of the fastest growing sectors in the agricultural industry with a growth of approximately 20% per annum. Horticulture has greatly contributed to the Kenyan economy through generation of income, creation of employment opportunities for rural people and foreign exchange earnings, in addition to providing raw materials to the agro processing industry. The sub sector employs approximately 4.5 million people countrywide directly in production, processing, and marketing, while another 3.5 million people benefit indirectly through trade and other activities.

Over the years, Kenya’s horticultural produce has gained popularity in the international markets due to the quality and variety that Kenya has to offer. Due to its delicate nature, horticultural products are among the items exported from Kenya to the international markets and are referred to as perishable cargo. The perishable nature is largely because horticultural products are highly sensitive to temperature and time exposure, should there be a failure to meet these conditions, the cargo ‘perishes’ or is seen to deteriorate in quality. Some of the perishables products exported from Kenya include flowers, vegetables, fruits, food stuff such as fish. In Kenya, the European Union (EU) is the principal importer of Kenya’s fresh produce with Netherlands importing the bulk of flowers for sale through the auction system. Other European countries such as Britain, Germany, Netherlands and France are major importers of Kenya’s fruits and vegetables while the Middle East market consumes fruits exported from Kenya.

Kenya Airports Authority (KAA) highlight the critical impact of perishables handling on the total volumes of air cargo handled in Jomo Kenyatta International Airport (JKIA). For instance, in July 2014 statistics from the Kenya Airports Authority (KAA) highlight that a total of 13.8 million kilos of cargo was exported out of Kenya. Out of this total, perishable cargo comprising of fresh produce, flowers and miscellaneous perishables products account for 11.3 million kilos. This accounts for up to 82% of the total cargo handled in JKIA. In addition, out of the total perishable cargo exported out of Kenya, 90% of perishables are consumed by the European and Middle East at a ratio of 69% and 21% respectively.

Moses Wahome, the Divisional Manager at Siginon Aviation intimates “Kenya’s popularity in the international market for fresh produce arises from the high quality in our produce. In addition, unlike other countries, Kenya’s climate remains favorable and fairly predictable all year”.

To effectively export perishable products, an effective cool chain is a critical success factor. This includes facilities such as; cold rooms, freezers and refrigerated trucks. In line with the industry trends, air cargo industry players continue to align their products and services to ensure that they are able to meet the demands of the global market. Siginon Aviation is one such provider that recently opened at a new air cargo terminal on the airside of Jomo Kenyatta International Airport (JKIA). The USD 10 million facility was launched to meet customer and market demands for a functional yet convenient air cargo provider. Moses adds; “Excellent cold rooms minimize chances of breaking the cool chain by exposing the perishable cargo to unfavorable conditions for long hours. This ensures that the cargo is delivered in tip top conditions”. In Kenya, perishables handling accounts for over 80% of the air cargo export business. This comprises of about 1000 tonnes ferried daily from JKIA by freighter and passenger operators to the international market. Siginon Aviation handles daily exports comprising mainly of fruits and flowers handled in its air cargo terminal through leading cargo airlines into the European market. Perishables handling is also undertaken in other Kenyan airports such as the Mombasa International Airport with the key cargo comprising of chilled fish and frozen sea food. The Eldoret International Airport, also handles minimal perishables.

Moses asserts; “The outlook for growth in the air cargo business is positive. The potential for handling of perishables in Kenya is set to grow exponentially arising from key initiatives that have been undertaken by industry players as well as the Kenya government. One of the major initiatives is the expansion of JKIA which will attract more and bigger airlines to Kenya. In addition, the conclusion of the thorny issue of the European Union (EU) and East Africa Community (EAC) Economic Partnership Agreement (EPA) on Kenya’s horticultural products has given greater impetus to growth in this industry”

As with any industry, the air cargo industry in Kenya faces great competition from international markets such as South America, Ethiopia and Egypt. As such, players within the Kenyan market continue to benchmark their service and efficiency levels to thwart any major attacks on Kenya’s global market share in the perishables scene. Moses adds “In coming up with the Siginon Aviation air cargo terminal, we have offered our customers a modern facility that takes care of the needs of the exporter, agent and the airline”. The airside terminal boasts of modern facilities, spacious cold rooms comprising of an express cool corridor and free storage for up to 8 hours. “Our excellent cold rooms minimize chances of the breaking cool chain with long hours of exposure.” All the Siginon staff in the handling process are trained and certified by international bodies such as IATA to handle perishable as well as general cargo. Siginon Aviation has been in the market since 1997 in Nairobi’s JKIA airport, since then, the company has grown from strength to strength to its current position as a market leader of air cargo and ground handling in Kenya.

 

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