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Tazara potential in boosting inter-regional trade underused

TANZANIA and Zambia Railway Authority (TAZARA), needs increased investment to upgrade the railway infrastructure and rolling stock that will unlock its potential for boosting intra-regional trade, a key pillar for regional integration in southern Africa.

The Tazara Managing Director, Bruno Chingandu told the `Business Standard’ that the 1,860 kilometre-long bi-national railway owned by Tanzania and Zambia was vital in boosting intra-regional trade as it joins southern Africa and Eastern Africa through its railway transport network.

“There can be no better regional integration facilitator,” he said in an interview which appeared in a SADC magazine published by Tanzania Standard Newspaper (TSN), on Sunday.

“From the Port of Dar es Salaam in the East African Community (EAC), TAZARA links members of the Southern African Development Community (SADC) and the Common Market for Eastern and Southern African Community (COMESA), thereby forming a critical infrastructure backbone to ease the movements of goods and people amongst the three regional blocks,” he said.

“The Port of Dar es Salaam, where TAZARA links, also forms the gateway to the vast market in Far East and Middle East.”

With TAZARA’s railway infrastructure capacity estimated at two million metric tonnes per year TAZARA is ably poised to handle huge volumes of cargo arising from regional economic integration efforts,” he said.

The TAZARA railway line is designed with a 1,067mm-gauge, which allows through traffic operations with other Southern African railways, such as Spoornet of South Africa, Botswana Railways, National Railways of Zimbabwe, Zambia Railways Limited Namibia Railways, Mozambique Railways and Societe Nationale Des Chemins De Fer Du Congo Sarl (SNCC) of the DRC. Essentially, all railway networks in the Southern part of Africa can be accessed by TAZARA.

With a designed capacity of over two million tonnes of freight per annum, TAZARA has been handling traffic for the Southern African Development Community (SADC), as well as the Common Market for Eastern and Southern Africa (COMESA), thereby providing a vital regional link amongst Southern, Eastern and Central African regions with the rest of the world through the port of Dar es Salaam.

However, the railway which is an important route for copper exports from Zambia and the Democratic Republic of Congo DRC), Africa’s top producer, is operating far below its potential capacity.

According to the 2018 Annual Report, the annual freight traffic for 2017/18 financial year was 220,818 metric tonnes, up from 171,000 metric tonnes in 2016/17.

TAZARA plans to transport 300,000 metric tonnes of freight and 800,000 passengers in the 2019/20 financial year in what reflect the current performance of the Authority based on the available resources.

“There is a lot of potential, considering the available volumes of traffic on the Corridor which TAZARA services, that is currently estimated to handle in excess of three million metric tonnes,” said Mr Chingandu.

He said there was need for concerted efforts to increase investments towards the improvement of the railway infrastructure and equipment in order to increase the volume of traffic and passengers that use the railway infrastructure.

Despite operating below capacity there are positive trends which fuel optimism about future prospects.

The railway is recording significant improvements since 2016 after it halted falling-trend of annual freight figures that were nose-diving since 2017.

According to 2018 Annual Report, the volume of freight traffic that was transported increased by 29 per cent, thanks to intensified marketing efforts and enhanced operational execution.

Freight traffic rose from a low of 88,000 metric tonnes in 2014/15 financial year to 130,000 metric tonnes in 2015/16 financial year, 171,000 metric tonnes in 2016/17 financial year and 220,818 metric tonnes in 2017/18 financial year.

Other key factors include injection of some working capital in the form of payment of salaries to employees and provision of fuel revolving fund by shareholding governments.

Which resulted to minimal disruptions of operations and the allocation of revenues generated from operations to priority areas in track and rolling stock maintenance which resulted in improved transit time and relatively better wagon turn-round.

Besides, the removal of VAT on auxiliary services on transit goods at the Dar es Salaam port resulted in improved port competitiveness opening up the flow of chemicals such as fertilizers and sulphur which the customers had diverted to other ports in the region.

TAZARA railway was built between 1970 and 1975 to give landlocked Zambia a link to the Dar es Salaam port, as an alternative to export routes via rail lines to Rhodesia (now Zimbabwe), South Africa and Mozambique.

The railroad was a turnkey project financed and executed by the People’s Republic of China. Total costs were about US$500 million, making it the largest single item foreign-aid project ever undertaken by China.

THE private sector credit grew ...


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