Tea auctioners in the country are staring at huge losses that could run into billions, in the wake of a major system failure at the Kenya Revenue Authority.
According to the traders, the Kenya Revenue Authority (KRA) export payment systems (MSS levy) downtime, the failure of the Port Scanners and the perennial ICMS systems failure have resulted to container mapping challenges.
Speaking to the press in Mombasa, the Board of East African Tea Trade Association (EATTA) Chairman George Omuga stated that the halting of exports will have negative ripple effects at the Mombasa Tea Auction which may further depress tea prices that have recently showed improvements at the tea auction.
"A daily average of 100-150 containers of tea are exported through the Mombasa Port and the KRA system downtime has resulted to enormous losses incurred by the tea producers and exporters resulting to accumulation of unshipped teas." said Omuga.
Adding" This is happening at a time when the global shipping industry have been affected by the suez canal closure and the middle east logistics challenges."
According to Omuga, In the recent past tea exports have encountered myriad challenges from the various Partner Government Agencies (PGAs) that has heavily hindered export, increased the operational and export costs for tea exporters and negatively impacted the tea trade.
Omuga charged "Mombasa Tea Auction offers teas from 10 African tea producing countries and the export inefficiencies at the Port of Mombasa may compel the member countries exporting their teas through the Port of Mombasa to consider using alternative neighbouring Ports in the region.
The tea sector is the largest foreign exchange earner to the Country and contributes significantly to the socio-economic development in the country. In 2023 Kenya exported tea worth Kshs. 186 billion through the Port of Mombasa equivalent to 4% of the GDP.
The traders are now calling on the government to address the issue to avoid more damage and loses.
They stating that they have not been able to ship any container from last week Thursday, revealing that exporters have been incurring huge loses in terms of demmurage and logistic costs
"We risk being black listed as unreliable supplier."
Among the issues they want to be urgently resolved includes rescan of containers which they argue costly and leads to delays, rotation of officers especially Verification Officers (Vos) and Head Verification Officers (HVOs) is done abruptly with the people taking over roles not aware of what is expected of them. The officers are also very few, delays encountered at Kilindini exports office and the frequent downtimes of the ICMS system.
