TAZARA with progress and improvement
The Tanzania-Zambia Railway Authority (TAZARA) Board of Directors, comprising the Permanent Secretaries responsible for Transport in the United Republic of Tanzania and the Republic of Zambia, Dr. Leonard Chamuriho and Eng. Misheck Lungu, Chairperson and Co-Chairperson, respectively, together with four other Board Members from both countries, Prof. Razack Lokina, Mrs. Rukia Shamte, Mr. Stanslous Sichalwe and Mr. Peter Kazhila, virtually held the 115th Board Meeting via the e-Government platform, on the 30th Day of September 2020.
The Board reviewed the performance of the Authority for the Financial Year (FY) ended 30 June 2020 and noted a four percent (4%) improvement in freight traffic compared to the previous FY, ended 30 June 2019. The Board observed, however, that the performance was suppressed by limitations arising from insufficient and unreliable rolling stock (locomotives and wagons) and two natural disasters (landslide/wash-aways) that occurred during the FY, forcing the closure of the line for considerable periods.Freight traffic volumes transported by TAZARA for the year increased from 175,597 metric tonnes in the previous FY 2018/2019 to 182,302 metric tonnes in the FY 2019/2020. With the addition of 196,676 metric tonnes moved by Calabash Freight Ltd, through Open Access operations, the total line capacity utilisation for the FY aggregated 378,978 metric tonnes, up by 4.5% from the cumulative volume of 362,710 metric tonnes recorded in the previous FY.
Passenger traffic, on the other hand, declined by nine percent (9%), negatively impacted by the COVID-19 pandemic, which compelled the suspension of cross-border passenger trains from March 2020 up to now, inducing a decline in passenger volumes from 3,046,002 passengers transported in the previous FY to 2,778,708 in FY 2019/2020.
In financial terms, the above performance resulted in overall revenue earnings of US$27.52 million for the FY ended 30 June 2020, including US$4 million earned from other non-operational income as well as Open Access Fees paid by Calabash Freight Ltd, the private operator plying on the TAZARA line.
Budget for the Financial Year Ending 30 June 2021
The Board considered and approved the budget proposals for the transportation of 400,000 metric tonnes of freight traffic and 3,400,000 passengers for the FY ending 30 June 2021, from which US$48.27 million operational and non-operational income is projected to be generated to cover the Authority operations for the year.
The Board was happy to note the repair and addition of seven (7) Diesel Electric Mainline Locomotives to the current average running fleet of eight (8) Mainline Locomotives for freight traffic, following the shareholders’ grant subventions in the last three years. With this enhancement in motive power, the Board expects the challenges that the Authority had been grappling with to subside forthwith.
In view of the boost in motive power, the Board anticipates further operational improvements and, hence, found it feasible to task the Management to double the annual freight traffic from last FY’s 182,302 metric tonnes to 400,000 metric tonnes in the current FY ending 30 June 2021.
The Board reviewed and authorised the proposed Revitalisation Bankable Business Plan (RBBP) with an investment outlay of US$558 million, which will be immediately submitted to the shareholders for approval and funding, through the TAZARA Council of Ministers.
The Board is confident that the RBBP provides a strong short-to-medium term blueprint for the required transformational actions that are anticipated to turnaround the operations of TAZARA and firmly put the Authority on a positive business trajectory, with the desired outcome being the achievement of full operational profitability and self-sustenance by the end of the FY 2021/2022.
Open Access Operations
The Board noted that the involvement of the private Open Access Operator in the transportation of cargo on the TAZARA line so far had contributed to a substantial diversion of freight traffic away from the roads and, therefore, aided in slowing down the deterioration of the roads in both countries.
In this regard, the Board directed the Authority to contract more private operators in the transportation of freight traffic on the TAZARA line through Open Access.
The Board also resolved to incorporate the Land Transport Regulatory Authority of Tanzania and the Government Inspector of Railways of Zambia in setting out regulatory procedures and benchmarks for TAZARA’s open access operations.
