Economic Zone and Free Port
Projected Cost: Kes. 210 bn (US$ 2bn)
Projected Cost: Kes. 210 bn (US$ 2bn)
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 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.
More..Kenya on Wednesday unveiled a grand industrialisation roadmap that seeks to make Mombasa a food processing hub targeting the export markets even as it locks in the billions of dollars East African nations spend on imports.
“We want to take advantage of the Mombasa port to serve the regional and global markets with processed food,” Mr Mohamed said during the launch of the blueprint in Nairobi.
Execution of the plan is set to start with the creation of a local processing hub at Mombasa’s Dongo Kundu special economic zone to be followed by another hub at the one million-acre Galana-Kulalu irrigation scheme in Tana River and Kilifi counties.
Mr Mohamed said construction of the necessary infrastructure for the hubs would start next June, paving the way for private investors to build plants on the 3,000-acre Dongo Kundu free trade area.
Under the arrangement, the special zones will process both locally sourced and imported raw materials for re-export – a move that could improve Kenya’s current account and create jobs that would help reduce the high unemployment rates currently standing at 40 per cent.
The Cabinet has approved the development of a Special Economic Zone (SEZ) in Dongo Kundu, Mombasa, targeting to boost job creation and regional trade.
The facility will be developed as an industrial and commercial hub with potential for the creation of jobs for the youth, a dispatch from State House said.
A blue print by the Industrialisation ministry showed that the plan included the establishment a free-trade zone (FTZ) within the 1,326 hectares SEZ facility.
“2018 is the target year for the launch of Mombasa SEZ at Dongo Kundu,” the ministry said in the document adding that it forecasts a population of 27,000 workers within the SEZ.
The FTZ project will be established on a site of between 300-500 acres of land that is available to investors.
It will host wholesale and retail trading, breaking bulk, re-packaging logistics, warehousing and handling and storage of goods among others.
Unlike the current practice at Mombasa port, where all goods are subjected to slow customs procedure, a FTZ creates a haven where goods on transit face less strict customs regulations.
The area will be reserved for re-exports to the 400 million-people Common Market for Eastern and Southern African (Comesa), allowing for transshipment of cargo without inspection or paying customs duty.
THIS IS A SURE KILLER. WE HAVE BEEN WAITING FOR FAR TOO LONG I WONDER WHY THE GOVT IS KEEPING PRODUCTIVITY ON HOLD WHEN THIS IS A PRIORITY!!!!This project is a low hanging fruit that has better prospects than Lamu port. but the GOK and local Kenyan investors are sleeping.
The GOK has been shifting goalposts every year since 2011 withholding development. Unleash this project and Kenya can give Dar a competitor in The coast.
The Japanese saw the potential of this long time ago, Now they are hanging around pretending to be drawing diagrams ever anticipated feasibility studies.
The Brits are interested thus financing the Moi international Airport road while keeping their eyes on the developments.
The French are watching this space thus they are funding Mwache dam with their eyes wide open
The Chinese have boldly included SEZ with the port expansion project.
This is an easy plug to pull.
What to do:
1. Publish the SEZ master plan (if Cytonn can draw such good drawings for Newtown I wonder what GOK can do with such a parcel)
2. Start recruiting a group of investors IE like what Tatu city is doing and Keep it open highlighting big names, you will see many apparel manufacturers booking spaces.
3. Fast track the Dongo Kundu Phase 2