25 February 2013

Zambia: Tazara Challenges Stakeholders

TANZANIA Zambia Railway Authority (TAZARA) Managing Director Akashambatwa Mbikusita-Lewanika has challenged stakeholders to come up with a comprehensive and conclusive resolution to the company's crippling financial structure and corporate governance, in order to attain its vision.

This is according to a statement released by company head of public relations Conrad Simuchile in Lusaka at weekend.

Mr Mbikusita-Lewanika said during the Board of Directors and Council of Ministers meetings in Lusaka that, the challenge of the bi-national railway system was one of re-engaging, redefining and re-capturing the founding vision of TAZARA.

"In terms of capacity and performance, this is a vision of "inter-linking with other railway systems in Southern, Central and Eastern Africa towards a more effective integrated rail services that will reduce the cost of doing business and promote a more cost effective and trading regime," Mr Mbikusita-Lewanika said.

He revealed that an independent consultant engaged with the assistance of the Common Market for Eastern and Southern Africa (COMESA) and Trademark Southern Africa, has concluded that, the most critical operational and capacity constraint of TAZARA, is poor availability and perennial unreliability of locomotives, wagons and other pieces of equipment.

Mr Mbikusita-Lewanika said that "this fundamental constraint triggers a vicious cycle germinating from a shortage of operations and re-investment funding."

He contended that this leads to inadequate and untimely provision of fuel, spares and other operational materials.

The managing director added that all the problems over the last three decades, constituted a hindrance and handicap of deficiency of tools and resources for effective management.

He, however, said that, there were well identified solutions to the problem of limited capacity and poor service levels, through the rehabilitation of possessed stock of equipment, leasing of good condition equipment and purchasing of new equipment, which could be achieved through securing and applying for recapitalisation and working capital funds.

Mr Mbikusita-Lewanika said that TAZARA management has since tabled a proposed way forward through a three phase strategy comprising an immediate injection of US$ 32 million working capital, a medium term investment capital of US$100 million and a long term investment capital whose exact cost is to be determined in due course.

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