Kenya logistics industry

Kenya’s warehousing market is projected to exceed USD 700 million by 2023 according to Ken Research. The country should consider building more Inland Contained Depots to account for the shift in cargo handling form the Coast to Nairobi, an SGR driven move.

The research foresees congestion at Nairobi’s ICD, a problem for port authorities and logistics firms. Such a difficulty could create inefficiencies for supply chains that depend on the facility, and ultimate customer dissatisfaction.

In a measure, the Nairobi County government has announced plans to reduce levies for foreign investors as it seeks to transform the city into a global investment destination. Kenya has also promised global investors facilitation to acquire land for setting up SEZs. The SEZs will be established in Mombasa (including Dongo Kundu Free Port), Lamu and Kisumu.

Accounting for the International Trade Agreements, bilateral and free trade agreements with various countries, along with involvement in initiatives such as COMESA, ACP, AGOA and the recent Pan-African Trade act (AFCTA), the research foresees a substantial improvement in trade.

These could accelerate demand for industrial property over the next few years which could make for a boom in logistics property. Already, there’s not enough quality warehousing space to enable firms move things around according to industry sources. Modern warehousing in Kenya is largely underdeveloped since the country’s logistics industry is still at the growth stage.

Analysts at Ken Research in their latest publication “Kenya Warehousing Market Outlook to 2023 – By Closed Normal, Open Yard, Closed Ac and Cold Storage; Contract and Owned Warehousing; Industrial Warehouses, ICD and Cold Storage” believe that the Freight Forwarding market in Kenya is expected to grow due to increasing foreign trade, market entry of international players and the booming horticulture industry.

RelatedGlobal logistics property sailing steady

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