Maritime PS Urges Investment Surge to Unlock Kenya’s Blue Economy Potential

Kenya’s Blue Economy holds vast potential, yet it remains largely untapped despite the country’s strategic location along the Indian Ocean coastline and access to abundant marine resources. The Maritime and Shipping Principal Secretary, Geoffrey Kaituko, recently underscored the need for urgent investment and collaboration between the government, development partners, and private sector players to fully realize this potential. His remarks were made during the Blue Economy Innovation and Investment Summit in Mombasa, where he emphasized that the sector is at a critical juncture, poised to drive Kenya’s economic growth if given the necessary support.

At present, Kenya’s Blue Economy contributes about 2.5% to the country’s Gross Domestic Product (GDP), generating Ksh178 billion annually. However, industry experts believe this figure could soar to as much as Ksh500 billion per year if the sector’s opportunities are properly harnessed. Kaituko’s call for increased investment aims to close this gap by unlocking the potential of Kenya’s maritime sector, which has long been underutilized.

The Untapped Potential of Kenya’s Blue Economy

The Blue Economy encompasses a range of activities, including fisheries, aquaculture, maritime transport, offshore oil and gas, tourism, shipbuilding, and ocean energy, among others. Despite the breadth of opportunities, Kaituko noted that Kenya has barely scratched the surface in terms of realizing the benefits from these sub-sectors. Speaking at the summit, which was themed “Building an Inclusive Blue Future,” Kaituko remarked, “In Kenya, we are barely scratching the surface.”

Kenya’s maritime resources offer a significant economic frontier that could create thousands of jobs and boost the livelihoods of coastal communities. Kaituko highlighted that the Kenya Maritime Authority (KMA) — the regulator of the maritime sector — could be generating 20 times more revenue than it currently does if more strategic investments are made, particularly in areas like ship recycling, shipbuilding, and maritime transport.

For instance, a recent tender awarded to a local company to build a vessel for Uganda led to the creation of 400 jobs. This is just one example of the many opportunities that exist in the sector. According to Kaituko, Kenya could position itself as a hub for maritime transport and shipbuilding in East Africa, yet it loses an estimated Ksh600 billion annually due to a lack of involvement in both international and local shipping activities. By increasing investment in these areas, Kenya could drastically reduce these losses and stimulate economic growth.

Shipbuilding and Ship Recycling: Key Opportunities

Kaituko pointed out that one of the most promising sub-sectors is shipbuilding, which has already demonstrated its potential to create jobs and stimulate economic growth. The example of the Ugandan vessel project shows that local shipbuilding capabilities can be scaled up to meet both domestic and regional demand. Ship recycling is another area that offers significant potential, as it could create jobs while reducing the environmental impact of old ships being decommissioned improperly.

“We need to open up our registry and become a serious flagged state. Additionally, areas like ship recycling and shipbuilding present significant opportunities,” Kaituko said during the summit.

He also compared Kenya’s performance in the maritime sector to that of Ghana, a country with a much shorter coastline but one that generates ten times more revenue through its maritime activities. This comparison underscores how much Kenya stands to gain if it adopts a more aggressive approach to maritime investments.

Capitalizing on Maritime Transport

Maritime transport plays a crucial role in international trade, and Kenya’s strategic location along the Indian Ocean gives it a natural advantage. However, the country has not fully leveraged this potential. The lack of investment in maritime infrastructure and involvement in international shipping has cost Kenya approximately Ksh600 billion, a loss that could be mitigated through strategic investments in ports, shipping lines, and related infrastructure. The government and private sector need to work together to capitalize on this untapped potential by building the necessary infrastructure to facilitate maritime transport.

Kaituko emphasized that Kenya has a strong historical presence in maritime transport, and with renewed focus, it can regain its position as a key player in global maritime trade. He recalled Kenya’s past prominence in the sector, stating, “We can easily become a key seafaring nation.”

Strengthening Regulatory Frameworks and Capacity Building

One of the key obstacles to unlocking the Blue Economy’s full potential is weak enforcement of regulations. The Kenya Maritime Authority (KMA), the sector’s regulator, has the tools and regulations necessary to govern the sector, including the KMA Act of 2006 and the Merchant Shipping Act of 2009. However, according to Kaituko, KMA has been weak in enforcing these regulations, a situation that has hindered the sector’s growth.

“If KMA can enforce regulations like the KMA Act of 2006 and the Merchant Shipping Act of 2009, we will unlock the sector’s full potential,” Kaituko remarked.

Investing in capacity building is also critical for the Blue Economy to thrive. Developing human resources, providing training for maritime professionals, and enhancing the capabilities of local institutions will ensure that Kenya has the expertise needed to manage and grow the sector.

EU Support and the Go Blue Project

The European Union (EU) has been a key partner in supporting Kenya’s Blue Economy initiatives. The EU’s Ksh3.2 billion Go Blue project has provided much-needed funding and resources to strengthen Kenya’s maritime capabilities. During the summit, EU Ambassador to Kenya, Henriette Geiger, reiterated the importance of the Blue Economy not only in Kenya but across Africa. She emphasized that many countries, including Kenya, have not fully exploited their marine resources, and more needs to be done to integrate Blue and Green economies for sustainable development.

“We aim to integrate both Blue and Green economies, recognizing the need to manage land and sea together,” Geiger said.

The EU’s support has extended to the provision of critical resources, including the recent handover of five search and rescue boats to the Kenya Maritime Authority. These boats will enhance surveillance and safety in Kenya’s territorial waters, improving the country’s capacity to manage its marine resources. However, Geiger also stressed that the EU’s support alone is not enough to fully realize the potential of the Blue Economy. She urged both national and county governments to create a conducive environment for investment and to prioritize the development of infrastructure and regulatory frameworks that will attract private sector investments.

The Role of County Governments

County governments along the coast have a significant role to play in the development of the Blue Economy. Kaituko encouraged county governments to build on the foundation laid by the Go Blue project and collaborate with the national government and development partners to unlock the potential of the maritime sector. Coastal counties are strategically positioned to benefit from maritime activities, and by investing in infrastructure, capacity building, and regulatory enforcement, they can spur economic growth in the region.

Conclusion

Kenya’s Blue Economy is a critical sector with the potential to drive the country’s economic growth and create thousands of jobs. However, this potential remains largely untapped due to a lack of investment, weak regulatory enforcement, and inadequate infrastructure. Maritime and Shipping PS Geoffrey Kaituko’s call for increased investment is timely, as it highlights the need for collaboration between the government, development partners, and private sector players to unlock the sector’s full potential.

By investing in key sub-sectors such as shipbuilding, ship recycling, and maritime transport, Kenya can position itself as a hub for maritime activities in East Africa. Additionally, strengthening regulatory frameworks, building local capacity, and enhancing infrastructure will ensure that the country can fully capitalize on its maritime resources.

The support of partners like the European Union is crucial, but Kenya must take ownership of its Blue Economy initiatives by creating a conducive environment for investment and ensuring that national and county governments work together to achieve the sector’s full potential. The time is ripe for Kenya to unlock the vast opportunities within its Blue Economy and chart a course toward sustainable economic growth and development.