The World Bank has threatened to withdraw funding for Kenya’s online cargo clearance system — which was meant to end cumbersome clearing process at the Mombasa port and border points — over delays in rolling out the project. The Bank, which is partially funding the National Single Window (NSW), raised concerns that the government was taking too long in acquiring the software required for the system, which was supposed to go live at the beginning of this year.
NSW is a project of the Kenya Trade Network Agency (Kentrade), an agency created to oversee the implementation of the system. The World Bank, in a letter dated April 17 to Transport Permanent Secretary Dr Cyrus Njiru and signed by Rajashree Paralkar, the then World Bank acting head of office for Kenya, has raised the alarm over the slow implementation of the project, saying that “a quick decision is required since NSW funding remains unutilised in the past five years.”
The World Bank earmarked $3.2 million for the project. Kenya hopes to cut the time it takes to process goods through Customs at ports by half in the project expected to cost at least $6 million. Besides minimising errors in data re-entries, the system will lower other business costs through the elimination of manual processes (transportation to points of service in government ministries and departments), eliminating the need for physical movement to the different departments except to collect goods.
Kentrade admits the delays, saying the project should be operational by next month.
“There have been the delays of logistics of setting up the agency and building capacity of the agency. But in our last meeting with them, we agreed that an open tendering process would conclude the process faster,” said Daniel Kiange, the business analyst at Kentrade.
The procurement of software for the system has been riddled with controversy, with Kentrade apparently focusing on acquiring the software through a single source from a private company in Singapore, but the World Bank insisting on an open competitive tendering process. “It seems Kentrade has focused on the Singapore/Kenya bilateral agreements whose timeline for signing is yet to be determined.”
The letter goes on to say that in the absence of clear timelines and commitments, the World Bank has proposed that Kentrade should invite bids for the software since there are many electronic single window providers in the market.
“[The government of Kenya] should advise the [World] Bank so that earmarked funds can be used to support other institutions that are keen to install their own electronic single windows.”
But Mr Kiange says that going with the Singapore provider was not a decision of Kentrade. “Kentrade was established in 2011; before this, the national single window project was under the Vision 2030 Secretariat. The initiative to go through Singapore was already in place by the time Kentrade took over — it was an inherited decision,” he said, adding that Kentrade intends to do the procurement through an open tendering process.
The country aims to cut cargo clearance times at the port of Mombasa to a maximum of three days from the current 7-14 days, and at Jomo Kenyatta International Airport to one day. For goods being moved by road, cargo clearance times should drop to just one hour from the present two days.
It is estimated that the streamlined procedures resulting from the single window will save the Kenyan economy $150 million to 250 million in the first three years, and thereafter between $300 million to $450 million every year.