Faridah Kulabako
10 November 2009
Neither the long distance nor the high transport costs is the reason for shunning the Southern Corridor route.
Port handling constraints at Dar-es-Salaam including delays in off loading, clearing and border crossing at the Tanzania-based port coupled with poor infrastructure of the Northern Corridor are responsible for its failing to beat its competitor - Mombasa Port in neighbouring Kenya.
The Northern Corridor [Mombasa to Kampala] is still seen as the most viable route to the sea by many traders given its moderately developed rail and road network as opposed to the central corridor [Dar-es-salaam to Kampala] which is longer with poor infrastructure.
The Northern Corridor contributes almost 90 per cent of Uganda's exports and exports with only 1 per cent coming in through the port of Dar es Salaam.
The Kenyan route is also said to be the shortest way to Indian Ocean for both Eastern and Central African countries (1,300Kms) and turn around time for a train from Kampala to Mombasa is four days as opposed to 19 days from port of Dar-es-salaam to Kampala which is close to 2, 000Kms.
Cargo dwell time at the Tanzania-based port is estimated to be about 13 days arising from delays in cargo processing and handling.
A trader's experience
Mr Ali Kiwanuka, a trader at Majestic Plaza, told Buisness Power last week, that using the Mombasa port for his imports is convenient to him because he could not stand the slow clearing system at the port of Dar-es-salaam that always cost him precious business time.
"There is only one crane to off load all the containers and that wastes a lot of time," he said.
By May 2009, the dwell time at the container terminal at the Dar port had reached an average of 25 days per container and for some transit traffic it was 35 days.
As a result, many business people from landlocked Uganda, Burundi, Rwanda and Congo who formerly imported goods through the Dar port decided to use Mombasa Port.
Trucks queue at the Malaba customs yard which early last year was boycotted boycotted by drivers because of the long queues. FILE Photo
Mr Kiwanuka said traders are forced to pay extra money for additional days the ship spends before docking.
"A ship takes more than two weeks in the ocean before docking and all the expenses for the extra days are incurred by the trader," Mr Kiwanuka said. "After off loading, containers are again taken in a ware house where you have to pay $200 [Shs380, 000] to get them out."
He said unlike the port of Mombasa where transport fees are paid once for the whole journey to Kampala, at the port of Dar-es-salaam, traders pay to transport their goods up-to Mutukula and from Mutukula to Kampala.
"There is only one crane to off load containers and getting a car to carry your goods is another stress," he said.
Importing a tone of cargo from Mombasa to Kampala costs $294.1 (Shs546,840) while from Dar-es-salaam it costs $300 higher(Shs561,000).
Climatic effects
In a recent interview with Business Power, Mr Everest Kayondo, the vice chairman of Kampala City Traders Association (Kacita) said the Tanzanian route is seasonal and normally affected by rains, which sometimes collapse bridges cutting off trade completely.
"The long route would not have been a big problem but the fragile bridges which normally collapse during rainy seasons discourage traders," said Mr Kayondo.
He, however, said developing the infrastructure and working on delays at the Dar-based port would decongest the Mombasa port, which is currently overwhelmed by goods to Uganda, Southern Sudan, Rwanda and Burundi.
However, in June, the Tanzania Port Authority embarked on a number of measures including the use of information technology and streamlining the documentation procedures in cargo clearance from the port, auctioning of overstayed cargo and improving performance of terminal operators with better equipment.
Mr Kayondo said the Ugandan government should liaise with is Tanzanian counterparts to workout a lasting solution for the poor roads that deter proper trade between the two countries.
"The negative attitude by our Tanzanian brothers needs to be worked on because they seem to be in no hurry whether at work or not," said Mr Kayondo.
The State Minister for Trade, Mr Gagawala Wambuzi, said the Tanzanian government and other southern Africa countries were implementing long-term plans to construct the Dar-es-salaam route of rail and road and make it attractive to importers and exporters to the East and Southern Africa countries of Uganda, Rwanda, Burundi, DR Congo, and South Sudan.
"The Ugandan govern is going to build the road from Kampala, through Masaka up to Mutukula border to ease transport," said Mr Wambuzi.
The Southern Corridor had been redundant to most traders until the January 2008 post election violence in Kenya that the Ugandan business community started using it. But still, that was short lived.
"Ugandans are comfortable to react to something that has already occurred other than pro-acting," said Mr Kayondo.
Though the route is popular among traders, Mr Kayondo affirms that 50 to 60 containers are lost to highway robberies on the Mombasa Kampala route annually.
The Dar-es-salaam port has 11 berths and the Mombasa port has 19 berths.
Having been designed to handle 250,000 twenty-foot equivalent units (TEUs) - a measurement used for capacity in container transportation - the Dar port is smaller than its Mombasa counterpart, which handles 615,733 TEUs.
Recently, the Kenyan government wanted to privatise berths 11-14 at the port of Mombasa, a move which was opposed by Dock workers saying a second container terminal under construction would cater for the growing container traffic to about 2.8 million TEUs in 2012.
Charges and need for incentives
However, last week, the port of Mombasa cut tariff charges for scanning, verification, inspection and associated stripping that had initially been pegged at $75 (about Shs150,000) and $110 (about Shs210,000) for the 22 and 40-foot containers respectively to avoid loss of business to rival ports.
Mr Peter Ochieng', Kobil Uganda's marketing and operations manager told Business Power that the government needs to put incentives to encourage traders to use the Southern Corridor route since the Mombasa port was overwhelmed by big numbers of cargo to East Africa's landlocked countries.
"Traders need to be encouraged to use the southern route through incentives like tax holidays because the Mombasa port can no longer handle Uganda's needs in time," said Mr Ochieng'.
Mr Wambuzi, however, said the government can't provide any other incentive apart from modernising the infrastructure and creating an alternative trade route.
Mr Ochiege' attributed the persistent shortages of fuel in the country to the inability of the Mombasa port to clear cargo in time saying that the port has become too small to handle all the Ugandan goods contributing to shortages in the country.
Importation of a cubic metre of oil from Dar-es-Salaam costs $200 (about Shs400, 000) yet importing a similar quantity from Kenya costs $50 (about Shs100, 000). This means that the extra cost will be passed on to the consumer.
Though eastern DR Congo, Rwanda, Burundi and Southern Sudan use Uganda as a shorter route for transiting their cargo from Mombasa, they (Burundi and Rwanda) are, however, planning to complete a 500 kilometre road linking them with Tanzania in four years time.
This means that although cargo, which transits through Uganda is a very small percentage, if Rwanda, Burundi, the DRC and Southern Sudan stopped cargo transits through Uganda it would hurt the economy.
A transit license costs Shs300, 000 a year per transit cargo truck going through Uganda.
Statistics from Uganda clearing and forwarding agents indicate that between four hundred thousand and seven hundred thousand Transit Entry Units (TEU'S) to the hinterland passed through Uganda last year. Most of this traffic was from the port of Mombasa and not Dar-es-Salaam.
Mr Wambuzi, however, said the sinking of the Uganda Railways ferries - MV Kabalega and MV Kawa was sabotage from Uganda's enemies of development who wanted to disorganise Uganda's trade with Tanzania.
MV Kabalega, the Uganda Railways cargo ferry ship carrying goods worth millions of dollars from Mwanza in Tanzania to Uganda collided with MV Pamba, which was heading to Mwanza Port in Tanzania and sank to the bottom of the Lake Victoria in 2005.
"There is no way the two ships could have sank at once, someone is behind it," he said.
Since then there has been problems of under carriage because of lack of capacity for shipment of goods, putting much pressure on the already overwhelmed road and rail transport.
If no modern alternative trade route is put in place, Uganda's trade with its neighbours may be on a thread since there are concerns over the usability of Jinja Owen Falls Bridge that is reportedly cracked and could collapse anytime if remedial measures are not undertaken. The closure of the bridge would cut off the south-eastern part of the country, the main import-export route, from the Mombasa.
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