16 April 2014

Tanzania: Fast Central Corridor Pace Urged

PRESIDENT Jakaya Kikwete has called on partner states to promote the participation of the private sector in investing in infrastructure projects in the Central Development Corridor.

He said in Dar es Salaam that government financing alone, for example, was not enough for the ambitious road and railway infrastructure projects in the corridor. "It's time we encouraged further private sector participation.

It remains an alternative and viable option to minimise the public financing gap in infrastructure development," he told the World Economic Forum Alignment Meeting on Development of the Central Corridor.

Tanzania plans to capitalise on a long coastline and upgrade existing railways and roads to serve growing economies in the land-locked heart of Africa from Uganda on its north border to Malawi in the south.

As East Africa's second largest economy, the country has a long-term plan to upgrade the Central Railway Line to standard gauge in a project running from Dar es Salaam to Isaka.

"In partnership with Rwanda and Burundi, the grand plan seeks to extend the line from Isaka to Kigali and onwards to Keza-Musongati in Burundi in a project estimated to cost a minimum of 4.13 billion US dollars," President Kikwete said.

Tanzania and Burundi have also a bilateral arrangement to construct a 200-kilometre standard gauge railway line between Uvinza in Tanzania and Musongati in Burundi, estimated to cost 550 million US dollars.

Tanzania also has short-term plan to rehabilitate the railway line by reinforcing its formation, strengthening its bridges, removing lighter, old, worn-out rails, fasteners, sleepers and installing new heavier rails, sleepers and ballast.

According to Mr Kikwete, almost 600 kilometres have been done so far. "Government financing alone may not easily raise all the money required. We do not have the money nor can we easily get someone to lend us so much money.

We have tried this option over the years without much success," he pointed out.

The Central Corridor is located at the strategic geographical position, which makes it a natural choice as a major trade route for countries of the Eastern and Central African regions.

Transit demand from these countries is forecasted to increase from 2.7 million to 9.8 million tons by 2030, President Kikwete said. With the recent discovery of enormous deposits of nickel in Burundi, the corridor is about to transport more volumes of heavy minerals within the coming two to three years.

"Our neighbour, Burundi, may in the coming two or three years start exporting between 1.5 million tons and 3 million tons of nickel concentrates a year," he noted. Tanzania also expects two nickel mines in Kabanga and Dutwa in Kagera Region to be operational in the same time span, the president said.

"It is likely that nickel processing would require importation of huge volumes of sulphur per annum. All these volumes are expected to pass through the Central Corridor," he added.

Transport in the central corridor suffers from inefficiency, which contributes to prohibitively high transport costs, hence impeding the region's ambition to realise its overall vision for socio-economic development.

Tanzania has also carried out projects to upgrade operations at the Dar es Salaam port, which include dredging of the entrance channel to the port, construction of Berths 13 and 14 and strengthening and deepening of Berths 1-7 and development of the Roll on - Roll off (RO-RO) Berth at the port.

The government also has signed a framework deal with China Merchants Holdings (International) to construct a new port at Bagamoyo, 75 kilometres north of Dar es Salaam, in a project expected to involve more than 10 billion US dollars.

The construction of the port will also involve building infrastructure for a special economic zone and railway network.

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