Kenya Advances Multi-Billion Dollar Port Privatization to Secure Regional Logistics Dominance

Kenya is set to lease out key port assets after its National Treasury approved a feasibility study on the privatization plan. For over a decade now, the East African nation has been considering port privatization to improve efficiency and maintain regional competitiveness in logistics. The approved concession plan is expected to attract about $1.2 billion in private sector investments. The concession is scheduled in phases, each covering different assets in Mombasa and Lamu ports. The first batch of assets to be tendered include Mombasa port berths 11 to 14, Mombasa Port Container Terminal 1, Lamu container terminal berths 1 to 3, and the Lamu Special Economic Zone.

These assets are estimated to require an investment of over $610 million, with the Kenya Ports Authority adding $60 million in co-investment under a public-private partnership model. The second batch of assets will include Mombasa Container Terminal II, Mombasa container terminal berths 23 to 24, cargo terminal berths 1 to 5 and 7 to 10, Mbaraki Wharf, and the Embakasi and Naivasha inland container depots. These assets are expected to attract investments worth over $620 million. With this green light, the Kenya Ports Authority is now set to open the bidding process for interested operators while beginning the recruitment of an advisor to guide the planned concessions.

The privatization plans come at a time when Mombasa port has been operating at almost its full capacity, following rising cargo volumes in the past five years. Last year, the port handled a record 2.11 million TEU, a five percent growth from the previous year. To keep up, the Kenya Ports Authority has unveiled a berth expansion plan worth $150 million, plus port development in the adjacent Dongo Kundu Special Economic Zone estimated at $320 million. In addition, there are ongoing road infrastructure projects to improve connectivity between port terminals, with the success of several projects hinging on partnerships with the private sector.

On the sidelines of a trade summit, French ocean carrier CMA CGM pledged $820 million in Mombasa port modernization, targeting the two container terminals and positioning itself as a potential bidder. Meanwhile, DP World and Kenya-based GulfCap Africa advanced plans to establish a 222-hectare special economic zone near Mombasa port. The development of the Dangote Refinery in Lamu is also seen as a major boost for Kenya second seaport, with vessel calls rising due to the ongoing situation in the Middle East. Last year, Lamu port handled 155 ships and surpassed that pace by mid-May, while cargo volumes have risen by over nine hundred percent since 2024.

Why This Matters

The structured rollout of port concessions in Kenya highlights a deliberate shift toward leveraging private sector balance sheets to manage intense infrastructure demand. As Mombasa operates near maximum capacity and Lamu absorbs surging traffic, mobilizing capital through public-private partnerships allows the state to bypass fiscal constraints while accelerating critical terminal upgrades and inland container depot efficiency.

Integrating major international operators and regional industrial park developers into the port ecosystem creates a tightly bound logistics corridor. This strategic alignment addresses immediate capacity bottlenecks while embedding Kenyan trade infrastructure deeper into global shipping networks, reinforcing East Africa commercial connectivity against the backdrop of shifting geopolitical and maritime routes.

Opportunities

• Infrastructure Contractors: Direct participation in terminal modernization, berth expansions, and road connectivity projects tied to the Mombasa and Lamu port corridors.
• Logistics Operators: Bidding opportunities in the phased concession tenders for container terminals, general cargo berths, and inland container depots.
• Industrial Zone Developers: Investment prospects within the Lamu Special Economic Zone, Dongo Kundu Special Economic Zone, and associated industrial park initiatives.
• Financial Institutions: Advisory and co-investment roles supporting multi-million dollar public-private partnership structures alongside the Kenya Ports Authority.

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