Dar, Lusaka plan TAZARA revival

Tanzania and Zambia have started discussions on recapitalisation and overhaul of operations and management structure of the Tanzania-Zambia Railway Authority (TAZARA) to turn-around the fortunes of the firm, which is currently in bad shape.
The Council of Ministers, which comprises ministers for Transport, Finance and Commerce from both sides, will meet again in June to make clear resolutions on the future of the railway firm, including options for private sector participation.

The Tanzania-Zambia Railway Authority (Tazara) Managing Director, Mr Akahambatwa Mbikusita Lewanika, told the 'Daily News' recently that the two governments have shown commitment to restore the firm's glory.

"It is gratifying to note that after two years, the Council of Ministers of TAZARA finally met in December 2012 and are again due to meet in June 2012," he said.

In his New Year greetings last month, Mr Lewanika said the firm needed about 770.11 million US dollars (1.2bn/-) to stand on its feet again.

TAZARA's performance hit the lowest point with the annual performance in terms of freight going down to 383,055 metric tonnes of cargo transported in the financial year 2008/2009, necessitating the revamping of the railway line, dubbed Uhuru Railway.

Mr Lewanika said the management has since reversed the regressive trend in freight service performance whereby the performance improved to 522,966mt during the 2009/2010 financial year and to 533,964 metric tonnes during the 2010/2011 financial year.

"This performance could be better but the company faces so many challenges, the most critical one being lack of recapitalisation, whose consequences include dilapidated machinery and equipment, like locomotives and wagons," he noted.

The reforms may touch on the system that requires a TAZARA MD to come from Zambia and his deputy from Tanzania, an arrangement that is likely to be shelved to give room for private sector investments and management.

The 1,860-kilometre TAZARA-run railway line, stretching from Dar es Salaam to Kapiri Mposhi in Zambia, was constructed between 1970 and 1975 by the Chinese government through a loan estimated at 985 Million Chinese Yuan (245bn/-).

According to Deputy Transport Minister Athumani Mfutakamba, half of the debt was recently written-off by China. Mr Mfutakamba said the restructuring and capitalisation of TAZARA was inevitable but some things needed to be agreed upon by the governments of Tanzania and Zambia prior to implementation.

He noted, for instance, that some issues needed change of laws in the two shareholding countries before changes are effected.

Under Protocol 14, China has extended a loan worth 40 million USdollars (60bn/-) to TAZARA through the shareholding governments for the purchase of 90 wagons (they arrived in December 2011) and six locomotives due to arrive in April.

An official in the Chinese Embassy in Dar es Salaam said his country will only be too happy to see TAZARA improve and that country will not mind whether the firm will be entrusted to other investors.

"The two governments (Tanzania and Zambia) have mentioned the intention to invite investors but it is up to the higher authorities in Beijing to decide," he said.
Source: The Daily News,www.dailynews.co.tz
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