The government has announced significantly reduced customs clearance fees for public-owned cargo, with charges now set at less than 0.6 percent of the total Cost, Insurance, and Freight (CIF), a substantial decrease from the 1.5 to 6 percent typically levied by private clearing and forwarding firms.
This strategic move, spearheaded by the State Department for Shipping and Maritime Affairs through the newly revitalized Government Clearing Agency (GCA), is projected to save the government more than Ksh1.5 billion annually.
This initiative is set to streamline logistics for all public-owned cargo at various entry points across the country, aiming for the GCA to handle all government consignments.
A circular dispatched to all heads of ministries and Semi-Autonomous Government Agencies (SAGAs) detailed the new cost-effective services.
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For goods valued above Ksh20 million CIF imported via shipping lines, railways, and roads, the GCA will charge 0.2 percent of CIF, while those below Ksh20 million will incur a 0.4 percent charge. Airfreighted cargo valued above Ksh3 million will be cleared at 0.4 percent of CIF, and those below Ksh3 million at 0.6 percent. This sharp reduction in fees is expected to create considerable pressure on private cargo clearing agents.
Despite the government’s ambitious plans, concerns have been raised by the Kenya International Freight and Warehousing Association (Kifwa).
Fredrick Oloo, Kifwa’s national chairman, expressed reservations about the GCA’s capacity, citing potential inefficiencies.
“When the directive was issued last year, the agency had only three staff, and as they recruit more, we understand some would have retired or been sacked, hence the issue of human resources still beleaguers the agency.
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We have contracts with the government and we are yet to get communication on the new changes,” Oloo stated.
Data from the Kenya National Bureau of Statistics indicates that approximately 52 per cent of all cargo cleared at various border points belongs to the government and its Ministries, Departments, and Agencies (MDAs).
At the Port of Mombasa alone, government cargo accounted for over 20 million tonnes out of 36 million tonnes handled in 2023. This shift follows the Central Bank of Kenya’s March 3, 2025, report showing the state spent Ksh110.9 billion in 2024 on imported goods, with most clearances handled by private agents charging between 1.5 and 4 percent in service fees.
By Cornelius Korir
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