The Kenya Shippers Council (KSC) at KAM, in collaboration with Fresh Produce Exporters Association of Kenya (FPEAK), are assessing the impact of piracy on the economy.

The emergence and increase of piracy cases has increased the cost of sea freight through the Gulf of Aden.  As a result, shipping lines are avoiding the region for fear of attacks, choosing to take a longer more costly route via the Cape of Good Hope in the South. This has increased time and cost for shippers in the region.

The cost increase is recorded in such areas as Sea freight Rates; Insurance; Time (longer Voyage); Operational (in case of perishables and refers); Surcharges (piracy, Deviation, war risk etc); Socio-economic (resulting from job losses); Opportunity costs; and Loss of Markets.  The risk of declaring the East African coastline a “War Risk Zone” is attracting huge insurance premiums.

“This has led to our exports becoming less competitive and our inputs (from imports) becoming more expensive, leading to higher costs of production, higher transport costs and ultimately uncompetitive products,” notes Mr. Gilbert Langat, Chief Executive Officer of KSC.

As a major shippers’ organization representing key importers/exporters, KSC is collecting information from companies to help develop a position paper on the impact of piracy on the economy.  The position will be discussed with the Government and the International Community specifically the EU and America who have expressed interest to assist in mitigating the effects of piracy on Eastern Africa importers and exporters.

As a major shippers’ organization representing key importers/exporters, KSC is requesting companies for information that will help build a case for business to Government and the International Community specifically the EU and America who have expressed interest to assist in mitigating the effects of piracy on Eastern Africa importers and exporters.

It is in this regard that KSC is requesting KAM members to submit relevant data in the format tabulated below, for compilation of a comprehensive position for joint presentation. Submissions should be sent to Mr. Gilbert Langat on Email info@kenyashippers.org by 22nd January, 2010.

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