TRATADOS Y CONVENIOS INTERNACIONALES SOBRE MIGRACIÓN

3.6.1 Composition of the Transport Sector

The transport sector in Tanzania comprises of four modes of transport namely road, railways, air and maritime. The road transport is the most widely used and is mainly operated by the private sector. On the other hand the maritime transport is instrumental as far as the carriage of international trade is concerned. Overall responsibility rests with the Ministry of Communications and Transport (MCT). However, responsibility over the road infrastructure rests with the Ministry of Works (MOW) and the Prime Minister’s Office (PMO). The MOW looks after Trunk and Regional roads while the PMO is responsible for urban, district and rural roads. There are two railway systems, one under Tanzania Railways Corporation (TRC) and the other under the Tanzania Zambia Railway Authority (TAZARA). Seaports are under the Tanzania Harbours Authority (THA) whereas the Tanzania Railways Corporation operate inland waterways in Lakes Tanganyika, Victoria and Nyasa. The country has one national air line, Air Tanzania Corporation. The air mode also consists of three international airports at Dar es Salaam, Kilimanjaro and Mwanza. 3.6.2 Maritime Transport Sector

The Tanzania Harbours Authority operates three major ports of Dar es Salaam, Tanga and Mtwara. In 1994, THA in corroboration with the World Bank concluded a

plan, which focused in improving physical, commercial, operational and financial efficiency of the port. This was followed by the commercialisation study in 1996, which looked into the ways of making the organisation to be more commercially oriented as well as identifying areas for privatisation. In line with government resolve to transform THA into a landlord status and giving to private operators all the operational activities of the port, the study recommended establishment of business units for a concession to private sector developers. The first candidate for privatisation is the container terminal business unit, which is due to be concessioned towards the end of 1999. Meanwhile, a study on the concession of the Container Terminal explaining its status and recommended privatisation options has just been concluded. Follows up studies are to be conducted to enable THA to conclude concession agreements of the remaining business units.

3.6.3 Railways

Tanzania Railways Corporation (TRC) operates the main railway line from Dar es Salaam to Kigoma is the main link to Burundi, Rwanda and eastern parts of the Democratic Republic of Congo. There is also a branch at Tabora, which links to Uganda through Mwanza. TRC also have lines connecting the agricultural rich regions of Tanga, Kilimanjaro and Arusha. TRC also operates Inland Waterways Services in lakes Victoria connecting Tanzania, Kenya and Uganda, in Lake Tanganyika, which provide services for DRC, BURUNDI, Rwanda and Zambia and in Lake Nyasa with services to Malawi. Beginning 1997, TRC entered into a performance contract with the government, which gave it autonomy for it to operate on commercial principals. A restructuring programme was commenced implementation in 1991 for commercial viability and rehabilitation of infrastructure. Strategy for TRC is to privatise the marine services through sale of shares, which were not doing well operationally and concession out the operational activities.

The Tanzania Zambia Railway Authority(TAZARA) on the other hand is under joint ownership of the governments of Tanzania and Zambia. The privatisation is not being managed by PSRC but through the council of Ministers. The two governments have granted the corporation autonomy to operate commercially. Discussions are going on with Zambia Railways and South African Railways towards enhancing greater co-operation both commercially and technically for possible joint ventures. The strategy for the TAZARA is deregulation and sale of non- core assets (Hostels, Quarry).

3.6.4 Air Transport

In the air transport sector, privatisation involves Air Tanzania Corporation (ATC) and the three international airports of Dar es Salaam, Kilimanjaro and Mwanza currently under the Directorate of Civil Aviation (DCA). In 1992 the government liberalised the domestic air transport services thus opening up doors for private operators, which hitherto was the monopoly of ATC. Since then the number of private air transport operators has been increasing year after year resulting in competition and improved services. Privatisation strategy for ATC is sale of shares to private operators. Meanwhile, ATC’s subsidiary, the Dar es Salaam Airport Cargo Handling Company (DAHACO) has been privatised by sale of shares to the South African Airlines. During 1995, a company by the name of African Joint Air Service (AJAS) was formed under joint venture between Uganda, South Africa and Tanzania to undertake international air transport services.

The divestiture programme being implemented in the airports started with the privatisation process for the Kilimanjaro International Airport (KIA) on a pilot basis. A concession agreement with a newly formed company namely Kilimanjaro Air Port Development Company has been signed. The government has retained 24% of the shares and the remaining shares are to be given to the private sector.

3.6.5 Road Transport

In the road transport sector, private operators control both freight and passenger services with more than 90% of the market share. Private operators have also taken advantage of the ongoing reforms to increasingly become involved. Government involvement in this area has been through the National Transport Company (NTC), which was established to provide transport services where private sector participation was lacking or inadequate. Thus the government established Regional Transport Companies (RETCOs) in 10 regions and the Usafiri Dar es Salaam (UDA) to provide urban transport services in Dar es Salaam under the NTC. Privatisation strategy for UDA is to form joint venture. The privatisation of the RETCOs through sale of shares currently in progress will put almost the entire freight transport market in private hands. As for the roads sector, private participation is through semi- autonomous agencies that are to be created under the umbrella of TANROADS. These will be responsible for the management of operational functions including the administration of the road fund to be used sorely for repairing and maintenance of trunk roads.

3.7 Conclusion

For quite some time now, provision of transport infrastructure and services has been the domain of the public sector. However, as has been explained in this chapter, it would seem that there is emerging a shift for the public sector from investing in infrastructure partly due to changed priorities and also lack of funds. But the private sector has the money and is looking for attractive opportunities for investment. There is also considerable pressure from the industry for ports to be more efficient in terms of service offering, costs, prices, new services etc. Ports are also experiencing increased competition in the context of globalisation following more countries becoming aware of the benefits of free trade whereby more and more countries are now opening their economies to the world markets and removing tariff and non tariff

barriers to trade. Through global investments developing economies stand to benefit due to their comparative advantage in terms of low labour costs and natural endowments that can be utilised to produce goods and services that can compete in the world market.

The problem now, however, is how to transfer the ownership from the public to private and continue to command the investments that have been made for a very long period from tax payers’ money and giving it to private at a low price. What is the fair price to the investment and how do we go controlling a private monopoly that will emerge out of the privatisation. None the less, privatisation of the port industry should go hand in hand with privatisation in other related sectors particularly railways, road services, multi-modal transport operators, etc.