10 YEAR TRANSPORT SECTOR INVESTMENT PROGRAMME (TSIP) PHASE I 2007/ /12

Transcription

1 THE UNITED REPUBLIC OF TANZANIA 10 YEAR TRANSPORT SECTOR INVESTMENT PROGRAMME (TSIP) PHASE I 2007/ /12 MINISTRY OF INFRASTRUCTURE DEVELOPMENT TANCOT HOUSE, PAMBA ROAD. P.O. BOX 9144 DAR ES SALAAM TANZANIA APRIL, 2008

2 10 YEAR TRANSPORT SECTOR INVESTMENT PROGRAMME (TSIP) PHASE I 2007/ /12 MAIN REPORT i

3 TABLE OF CONTENTS Pages LIST OF ABBREVIATIONS AND ACRONYMS... vi FOREWORD... viii EXECUTIVE SUMMARY... ix CHAPTER INTRODUCTION Background TSIP Goals The TSIP Objectives Preparation of TSIP Structure...4 CHAPTER ECONOMIC BACKGROUND AND PROFILE OF TANZANIA Geographical Location and Natural Condition The Economy...6 CHAPTER TRANSPORT POLICY FRAMEWORK Transport Sector Vision Transport Sector Mission The National Transport Policy and Implementation Strategies Joint Assistance Strategy Joint Infrastructure (Transport & Communications) Sector Review (JISR) PPP Policy and Institutional and Regulatory Framework...8 CHAPTER THE NATIONAL TRANSPORT SYSTEM Road Transport Railway Transport Rail Asset Holding Company (RAHCO) Tanzania Zambia Railway Authority (TAZARA) Maritime and Inland Waterways Air Transport Pipeline Transport Development Corridors Dar-es-Salaam Development Corridor Central Development Corridor Tanga Development Corridor Mtwara Development Corridor Road Transport Corridors...21 CHAPTER INSTITUTIONAL REFORMS AND MAJOR STAKEHOLDERS IN THE TRANSPORT SECTOR Institutional Reforms Major Stakeholders Involved in Implementation of TSIP Key Ministries Other Ministries Regulatory Authorities and Boards Operational Agencies/ Parastatal Organizations Development Partners (Foreign Countries and International Organizations) Financial Institutions Training Institutions...24 ii

4 5.2.8 Private Sector...24 CHAPTER TRANSPORT SECTOR PERFORMANCE REVIEW (2001/ /07) Roads Status of Physical Road Development Works Review of Maintenance Works for the first five year of 10YRSDP (2001/02 to 2005/06) Major Achievements during the Period 2001/ / Challenges, Shortfalls and Weaknesses Railways Reli Asset Holding Company (RAHCO) Tanzania Zambia Railway Authority Weaknesses and Shortfalls of Railways Sub-Sector Strategic targets set for the Railways Maritime Transport Coastal Ports TPA Maintenance costs (2001/ /07) Containerization Inland Waterways Achievements Weaknesses and shortfalls Air Transport Investment and Operational Performance (2001/ /06) Passenger Traffic Cargo Traffic Achievements/strengths Weaknesses / shortfalls of Air Transport Institutional and Capacity Building Measures Funds Allocation for the Past Five Years ( ) Issues for further consideration...43 CHAPTER SCOPE OF THE TRANSPORT SECTOR INVESTMENT PROGRAMME (2007/ /17) Need for TSIP Maintenance of Existing Transport Infrastructure Strategy Road Network Maintenance Air Transport Rail Transport Marine Transport Strategies for Bridging the Maintenance Funding Gap Development Programme Selection Criteria Prioritization Road Sector Prioritization of Projects Air Transport Railways Maritime Transport Sub Sectoral Investment Requirements Roads Air Transport Investment Requirements Railway Transport...64 iii

5 7.4.3 Maritime Transport Investment Requirement Institutional Support Human Resource Development Training Institutions Data Base Development Capacity Building of Local Consultants and Contractors Cross Cutting Issues Safety & Security Environmental Issues HIV/AIDS Gender Mainstreaming First Phase Transport Sector Investment Programme Requirement Public Private Partnership (PPP) in the implementation of TSIP Option The impact of the Proposed TSIP on MKUKUTA...74 CHAPTER FINANCING OF THE TSIP PROGRAMME Infrastructure Development Key to Economic Transformation Financing Strategy of TSIP Through Traditional Sources of Funding Traditional Sources of Funding Road Infrastructure Not Adequate Financing Infrastructure Through Private Sector Participation Roadmap for Private Sector Participation in Infrastructure Development...78 CHAPTER MONITORING AND EVALUATION Approach Compliance of TSIP with the MDGs Compliance of TSIP with Vision Compliance of TSIP with the NSGRP APPENDICES Annex 1: Transport Sector Stakeholders Key Ministries Regulatory Authorities and Boards Operational Agencies/Parastatal Organizations Development Partners (Foreign countries and International Organizations) Financial Institutions Training Institutions Private Sector Annex 2: Proposed Road Projects for First Phase of TSIP Annex 4: TAA Development Projects for first phase of TSIP (USD 000s) Annex 5: RAHCO Development Projects for Phase 1 of TSIP USD In Mill Annex 6: TAZARA's Development Projects Disbursement In USD 000's Annex 7: TPA Proposed Projects (USD '000) iv

6 LIST OF MAPS AND TABLES MAP 2.1: TANZANIA...5 TABLE 2.1: REAL GROWTH FOR VARIOUS KEY SECTORS...6 TABLE 4.1: CONDITION OF TRUNK AND REGIONAL ROADS (JUNE 2007)...9 TABLE 4.3: SUMMARY OF ROAD DENSITIES IN KENYA, UGANDA AND TANZANIA MAP 4.2: THE RAILWAY NETWORK MAP 4.3: SEA AND INLAND PORTS MAP 4.4: EXISTING DOMESTIC AND INTERNATIONAL AIRPORTS MAP 4.5: DEVELOPMENT CORRIDORS TABLE 6.1: A LIST OF CONSTRUCTED / REHABILITATED TRUNK AND REGIONAL ROAD PROJECTS AND BRIDGES IN THE PERIOD 2001/02 TO 2006/ TABLE 6.2: A LIST OF ONGOING TRUNK ROADS PROJECTS WHICH WILL BE TAKEN ON BOARD THE TSIP TABLE 6.4: TREND OF TRUNK AND REGIONAL ROADS CONDITION TABLE 6.5: TRC MAJOR DEVELOPMENT PROJECTS 2001/ / TABLE 6.6: TRC MAINTENANCE PROJECTS 2001/ /06 COST IN TSHS MILLIONS TABLE 6.7: TRC OPERATIONAL PERFORMANCE INDICATORS TABLE 6.14 TRANSIT TRAFFIC THROUGH DAR ES SALAAM PORT (IN TONS) TABLE 6.15: TRANSIT CARGO THROUGH MWANZA PORT BY MSCL VESSELS 2000/04 (IN TONS) 37 TABLE 6.18: MSCL FREIGHT PERFORMANCE (TONNES) TABLE 6.19: NUMBER OF PASSENGERS HANDLED BY MSCL TABLE 6.21: FINANCING FOR TRANSPORT SECTOR (IN TSHS MILLION) TABLE 7.7: INVESTMENT REQUIREMENTS FOR TRUNK AND REGIONAL ROADS (USD 000) TABLE 7.10: SUMMARY OF DEVELOPMENT AND MAINTENANCE REQUIREMENT FOR AVIATION SECTOR (USD 000 ) TABLE 7.11: SUMMARY OF DEVELOPMENT INVESTMENT AND MAINTENANCE REQUIREMENT FOR THE RAILWAYS SUB SECTOR (USD 000 ) v

7 LIST OF ABBREVIATIONS AND ACRONYMS 10YRSDP 10 Year Road Sub-Sector Development Programme AADT Annual Average Daily Traffic AQSRB Architect and Quantity Surveyor Registration Board ATCL Air Tanzania Company Ltd BADEA Arab Bank for Africa Development BOT Build Operate and Transfer CAF Construction Assistant Fund CATC Civil Aviation Training College CIDA Canadian International Development Agency CIDF Construction Industry Development Fund CRB Contractors Registration Board DANIDA Danish International Development Association DFID Department for International Development DIT Dar es Salaam Institute of Technology DRC Democratic Republic of Congo DMI Dar es Salaam Maritime Institute DWT Dead Weight Tonne EAC East African Community EDF European Development Fund EIA Environmental Impact Assessment. EMCU Environmental Management Coordination Unit EPZ Export Processing Zone ERB Engineers Registration Board ERP Economic Recovery Program FINIDA Finland International Development Fund Fiscal Year GDP Gross Domestic Product GoT Government of Tanzania HDM4 Highway Development and Management Model HIV/AIDS Human Immune Virus/Acquired Immunology Deficiency Syndrome ICAO International Civil Aviation Organisation ICT Information and Communications Technology IDA International Development Association IMO International Maritime Organisation IRI International Roughness Index IRP Intergrated Roads Project IRR Internal Rate of Return KADCO Kilimanjaro Airport Development Company KPH Kilometre per Hour KIA Kilimanjaro International Airport LAPF Local Authority Provident Fund LGA Local Government Authorities MDA Ministries Departments and Agencies MDGs Millennium Development Goals MID Ministry of Infrastructure Development MoF Ministry of Finance MOHA - Ministry of Home Affairs MoW Ministry of Works MSC Maritime Service Company MTEF Medium Term Expenditure Framework NCC National Construction Council NDF Nordic Development Fund NEPAD New Partnership for African Development NIT National Institute of Transport vi

8 NMT NPV/C NPRA NRTP NSGRP NSSF NTP OC ODA PMMR PMO-RALG PMP PPF PPP PRS PRSP PSO RAHCO RETCOs RF RFB RUSIRM SADC SDI SEAP SIDA ST SUMATRA T 2 CENTRE TAA TANAPA TANROADS TANZAM TAS TAZARA TBA TEMESA TEU TGFA THA TPA TICTS TMA TPA TRC TSIP TSRP UNDP UN-MDGs URRP VOC Non Motorised Transport Net Present Value/Cost Norwegian Public Roads Administration National Rural Transport Program National Strategy for Growth and Reduction of Poverty National Social Security Fund National Transport Policy Other Charges Overseas Development Agency Performance Based Management and Maintenance of Roads Prime Minister s Office Regional Administration and Local Government Port Modernization Project Parastatal Provident Fund Public Private Partnership Poverty Reduction Strategy Poverty Reduction Strategy Paper Public Service Obligation Reli Asset Holding Company Regional Transport Companies Roads Fund Roads Fund Board Ruvuma and Southern Iringa Road Maintenance Southern Africa Development Community Spatial Development Initiative Structured Engineering Apprenticeship Swedish International Development Agency Surface Treatment Surface and Marine Transport Regulatory Authority Tanzania Transportation Technology Transfer Centre Tanzania Airports Authority Tanzania National Park Tanzania National Roads Agency Tanzania Zambia Highway Tanzania Assistance Strategy Tanzania Zambia Railway Authority Tanzania Building Agency Tanzania Electrical, Mechanical and Electronics Services Agency Twenty Feet Equivalent Unit Tanzania Government Flight Agency Tanzania Harbours Authority Tanzania Ports Authority Tanzania International Container Terminal Services Tanzania Meteorology Authority Tanzania Ports Authority Tanzania Railways Corporation Transport Sector Investment Program Transport Sector Reform Program United Nations Development Program United Nations Millennium Development Goals Urgent Roads Rehabilitation Programme Vehicle Operating Costs vii

9 T FOREWORD his document presents the Transport Sector Investment Programme (TSIP). The TSIP is planned to be implemented in two phases of 5 years each from financial year 2007/08 to 2016/17. The programme takes cognizance of the existing macro-economic development programmes including the Tanzania Development Vision 2025, National Strategy for Growth and Reduction of Poverty (NSGRP), Tanzania Assistance Strategy (TAS) and Millennium Development Goals (MDGs). Towards this end, the programme takes into account the need for integration of all transport modes or sub sectors which include roads, railways, ports, and airports with a view of acting as a necessary input and catalyst for the achievement of aforementioned economic goals. It should, however, be noted that, on going projects under various parallel programmes or plans e.g. regional and other national or sub sectors will be part of the TSIP without disturbing their current implementation arrangements. The TSIP main objective is to operationalise the Transport Policy Implementation Strategies by translating the National Transport Policy (NTP) objectives into time bound actions and activities. The Policy which was approved in 2003 calls for, among other things: (i) Development of effective and efficient seamless transport infrastructure; (ii) Mobilization of local and international resources to speed up integrated transport infrastructure development; (iii) Fostering involvement of public-private sector partnerships in the transport sector investment and management; (iv) Putting emphasis on rural access; (v) Enabling the transport sector to tick and facilitate the growth of key economic sectors including agriculture, manufacturing, mining, tourism and trade and, (vi) Taking cognizance of existing problems and taking measures for improving urban mobility. The programme has been prepared in collaboration with PMO-RALG, and has been highly consultative drawing expertise from transport sector stakeholders with the support of a part time consultant. The cooperation we have so far received from Development Partners through the Joint Technical committee of the Forum of Government/Development Partners is highly appreciated. We urge the Development Partners including the private sector to come out more frontally now to take up the various components of the programme. Tanzania has put in place key mechanisms to ensure that there is very efficient utilization of resources and hence effective implementation of TSIP. The mechanisms include but not limited to Public Procurement Act of 2004 that guide resource utilization through the process of procurement of goods and services; privatization contracts which guide resource collection and their utilization in the privatized parastatals; and formation of regulatory authorities such as the Surface and Marine Transport Regulatory Authority (SUMATRA) and Tanzania Civil Aviation Authority (TCAA), and other executive agencies to undertake activities that were once done directly by the Central Government e.g. Tanzania Airports Authority (TAA), Tanzania National Roads Agency (TANROADS), Roads Fund Board (RFB), etc. which are monitored by the Ministry through Performance Contracts. These mechanisms are a testimony that Tanzania wishes to utilize efficiently resources that are collected basing on the Good Governance spirit. As the saying goes Unity is Strength, I therefore take this opportunity to call upon all stakeholders including the development partners to join hands together with us so that the aspirations of this program can be achieved. Omari A. Chambo PERMANENT SECRETARY viii

10 T 10 Year Transport Sector Investment Programme (TSIP) Phase I 2007/ /12 EXECUTIVE SUMMARY he Transport Sector Investment Program (TSIP) is intended to implement one of the main goals of the 4 th Phase Government in Tanzania of ensuring that transport sector plays its rightful role of facilitating other socio economic sectors to attain their aspirations. In the end this will lead to development and hence poverty reduction in the country. As we are aware, transport plays a crucial role in the growth of the national economy; it facilitates domestic and international trade, contributes to national integration, and provides access to jobs, health, education and other facilities. Its demand is derived and in its own, the transport sector employs a considerable number of people who depend on it for their livelihood. It is in view of these facts that the TSIP was formulated. The programme is a tool for implementing the National Transport Policy aspirations guided by targets of Tanzania Development Vision 2025; National Strategy for Growth and Reduction of Poverty (NSGRP); Millennium Development Goals and other national and regional long term development strategies. This document provides the main frame of the programme. ECONOMIC PERFORMANCE Tanzania's average GDP annual growth rate for the period 2000 to 2006 was 6.0%. In 2006, the GDP grew to 6.2% compared to 4.8% in On average, GDP has been on increase for the past five years and it is expected to increase to reach 7.5% by This has been a result of economic reforms undertaken by the country. Despite the overall increase in GDP, transport sector growth has been fairly constant during the last six years at around 6.2%. This growth should have been ahead of the overall economic performance in order to avoid a situation where it could obstruct other sectors which demand transport services. THE NATIONAL TRANSPORT SYSTEM The current transport system consists of roads, railways, air, water, and pipeline modes. Total Road Network length is about 85,517 km. This includes Trunk and Regional roads (28,892 km) which is managed by TANROADS and the Urban, District and Feeder roads with a total of 56,625 km, managed by Local Government Authorities (LGA). There are also some unclassified roads such as those managed by TANAPA; Mining Companies, and Village authorities whose total length is not easily available. Tanzania railways system has a total length of 3,676 km of which 2,706 km is operated by Tanzania Railways Limited (TRL) and 975 km by Tanzania - Zambia Railway Authority (TAZARA). Tanzania maritime transport is characterized by the presence of major sea ports, which are Dar es Salaam, Tanga and Mtwara, and inland water transport with Mwanza, Bukoba, Musoma and Kemondo ports in Lake Victoria; Kigoma port in Lake Tanganyika; and Itungi and Mbamba bay ports in Lake Nyasa. These ports are managed and operated by Tanzania Ports Authority (TPA). Tanzania has a total of 368 aerodromes which are owned, managed and operated by different entities. Tanzania Airport Authority (TAA) owns, manages, operates and develops 62 airports. There are four International Airports namely; Julius Nyerere, Kilimanjaro, Zanzibar and Mwanza. Out of four International Airports, two of them have been managed by TAA; namely Julius Nyerere and Mwanza International Airports. Zanzibar International Airports is being managed by The Revolutionary Government of Zanzibar. KIA was leased by to a private operator since Pipeline transport in the country is used to transport crude oil products from Dar es Salaam to Ndola refinery in Zambia, a distance of 1,750 km, and natural gas from Songosongo to Dar es Salaam, a distance 232 Km. The crude oil pipeline is owned by TAZAMA while the Songosongo pipeline is owned by SONGAS. ix

11 INSTITUTIONAL REFORMS The Government has made a notable progress in the transport sector institutional reforms. In order to bring about efficiency and sustain economic growth, government departments whose functions were of operational or service delivery nature have been transformed into semi autonomous agencies. Operational Agencies are Tanzania National Roads Agency (TANROADS), Tanzania Airports Authority (TAA), Tanzania Meteorological Agency (TMA), Tanzania Government Flight Agency (TGFA), Tanzania Buildings Agency (TBA) and Tanzania Electrical, Mechanical and Electronic Services Agency (TEMESA). Reforms have also resulted into the establishment of transport regulatory authorities that include Surface and Marine Transport Regulatory Authority (SUMATRA) and the Tanzania Civil Aviation Authority (TCAA). The reforms include increasing Private Sector Participation in the Transport Sector through concessioning, management contracts and/or outright sale of parastatals. Dar es Salaam Port Container Terminal, KIA and TRC operation have been concessioned to the private sector. The National Transport Corporation and the Regional Transport Companies (RETCOs) were out rightly sold. Furthermore, a strategy for the concessioning of the operations of TAZARA as well as the revenue units of Tanzania Ports Authority (TPA) and those of the Marine Services Company Limited (MSCL) is being finalized. The establishment of Roads Fund (RF) and Roads Fund Board (RFB) has shown positive impacts as road maintenance has been improved. The Highway Ordinance has been replaced by the Roads Act, Similarly, the process towards strengthening the TANROADS by giving it more autonomy is being undertaken, and at the same time formulation of the Roads Safety Policy is at its final stages. PERFORMANCE OF THE TRANSPORT SECTOR FOR THE PAST FIVE YEARS In the last 5 years, the Government in collaboration with Development Partners has gradually invested in the transport sector particularly the road sub sector which has markedly improved the condition of roads. Railways, ports and airports authorities have been using their internally generated funds for capital expenditures with minimum support from the government and donor community. The fact that these parastatals were specified under the PSRC meant that investments in them were restricted. The delays to complete the privatization process has led to a lot of deterioration in the infrastructure and hence the services provided by these parastatals. Notwithstanding the low level of resource availability during the past five years, the allocation of funds to the transport sector has kept on increasing from USD million in 2001/02 to USD million in 2005/06. The total investment for the past five years in the transport sector was USD 1,484.7 million. Roads Sub Sector During the 1 st five year period of the 10 YRSDP, it was planned to rehabilitate and upgrade 2,158.7 km of trunk roads at an estimated cost of USD million and development of 3,505 km of regional roads at an estimated cost of USD million. The physical performance for the first five years of 10 YRSDP was rehabilitation and upgrading of 1,168 km of trunk roads which is 54.3% of the target. About 4,184.9 km of regional roads which is 119% of the target were rehabilitated. Good performance in Regional Roads was mainly due to some development partners programs which came in during the implementation of the programme. Estimated cost for trunk and regional roads maintenance operations was USD 508 million. Expected expenditure up to end June 2006 is USD million which is 55.8% of the target. The Major challenges and reasons for shortfalls (especially for Trunk Roads) in achieving targets of the 10 YRSDP in the first five years were: Shortage of plant and equipment for road works in the country Inadequate financing Local Construction Industry Capacity, which is limited in managerial skills and financial capacity. Also poor in equipment management skills and tendering skills. x

12 Institutional capacity of the implementing agency with inadequate contracts management skills among supervising staff and deficiencies in supervision facilities Delay in commencement of the programme due to late introduction and preparation of the programme. The Consultant also delayed in submission of the final report (2002) Delay due to cumbersome procurement procedures in the initial years TSIP has components which will address many of the above shortfalls. Aviation Sub Sector During the last five years, the Government through the Tanzania Airports Authority (TAA) and Tanzania Civil Aviation Authority (TCAA) implemented a number of development projects which were designed to further modernize the airports. The goal has been to make air transport improve and expand air transport infrastructure to foster both domestic and international trade and hence enhancement of socio economic activities. The number of registered air operators in the country has been increasing year after year. The aviation industry has been steadily growing with an average growth rate of 9% annually. This growth rate is greater than the average 4% growth rate of the global aviation industry. Revenue collection from airport operations has increased to TShs 23.0 billion in 2006/07 from TShs 4.34 billion in 1999/2000. Airports infrastructure, services and conditions in Tanzania has also improved to a great extent and has accelerated the need of improving them. Notwithstanding these achievements, air transport sector has not been able to achieve its desired goals. This has been mainly due to the following reasons: Deficiencies in the provision of international air navigation services. Inadequate airport facilities. Low human resources capacity to adequately manage and operate the air transport industry. Inadequate airport planning and management skills. Civil Aviation Master Plan (CAMP) that is in place does not accommodate the changes in policy framework that have taken place nationally, regionally and internationally. Lack of knowledge of the emerging Economic Regulation concept. Inadequate capacity in trained pilots and aircraft maintenance engineers. The lack of a management system that will link the civil aviation headquarters and its centres across the country. Manual collection and distribution of aviation data. It is envisaged that the implementation of TSIP, the proposed air transport sub sector projects will enable the sector to attain the desired goals within the next ten years. Railway Sub Sector Generally speaking the railway sub sector has been performing badly during the last ten years. The infrastructure is dilapidated and services rendered are below standard due to many reasons including old age and outdated permanent way and shortage of locomotives and wagons. The major event towards undertaking corrective measure was the concessioning of TRC services in September 2007 to a company known as Tanzania Railways Limited (TRL). The company is a joint venture between RITES Company of India who owns 51% shares and the Government of Tanzania who owns 49% shares. In terms of services, the number of transported passengers by TRL increased from 615,000 in 1999 to 683,000 in 2003 and dropped to 594,000 in Freight on TRC rose from 0.9 million tonnes in the late 1989 to million tonnes in 2002 and slightly dropped to 1.43 million tonnes in 2003 to million in 2004 and further down to million tonnes in xi

13 Operational efficiency of TRC performance has been constrained mainly by infrastructural problems. There is also growing competition from the road network and the North Corridor from Mombasa to Kampala. The stiff competition from road transport has made TRC to discontinue its passenger services between Dar es Salaam and Moshi. Poor rolling stock, i.e. locomotives and wagons, have also contributed to the low operational performance of TRC. The old outdated narrow gauge and several sequences of wash away of the railway infrastructure by floods has worsened the situation and made the railway system inefficient. TAZARA is facing a decrease in traffic from a maximum of 1.24 million tonnes in the late 1993 to the current average of about 600,000 tonnes a year, which is both caused by internal and external factors such as: Poor performance of the economies and political instability of the land locked countries in the Western part of our country, Change in traffic patterns, Competition from other regional corridors such as North Corridor, Maputo Corridor and corridors through South Africa; and Railway infrastructure and rolling stock weaknesses. Maritime Sub Sector The Government through the Tanzania Ports Authority (TPA) has implemented a number of development projects which were designed to further modernize the ports by providing additional cargo handling equipment, improve and upgrade infrastructural facilities. A total of TShs.54,068 million was invested during the period of which 30% of the financing was from TPA own sources. Notwithstanding the investment done in the past five years, TPA is faced with several challenges to make the ports of Tanzania efficient. These challenges include:- Low capacity of handling containers at the Dar es Salaam Port (250,000 TEUs) compared to an average demand of 300,000 TEUs per annum. Lack of space to increase the capacity of the container terminal at the Dar es Salaam Port. Inability of the Dar es Salaam Port entrance channel to handle ships of PANAMAX size ships. Inadequate transport services from other modes (i.e. some of the port facilities, the railways and road system). Inadequate human resources capacity to adequately manage the maritime transport. THE TSIP PROGRAMME The 4 th Phase Government goals is to ensure that there exist an adequate transport infrastructure and services, which are key factors in Tanzania s efforts to promote growth and reduce poverty, as described in the MKUKUTA - the National Strategy for Growth and Reduction of Poverty (June 2005). The TSIP Goals and Objectives to implement the overall Government Goal are outlined below. TSIP Goals The goals of this programme are to ensure that: (i) Each fundamental element of transport to be provided in the appropriate quality, quantity and form. (ii) All elements of transport are combined in a technologically optimum way for each mode of transport. (iii) Each mode is operated in a most efficient way. (iv) Appropriate mechanisms exist to ensure effective intermodal coordination and communication between the user, the operator, the regulatory agency and the government on all transport questions and issues. xii

14 (v) Transport plays its cardinal role of supporting the development of other sectors of the economy and hence speed up development. TSIP Objectives The objectives of TSIP are as follows: (i) Develop adequate, reliable, cost effective, efficient, safe, environmentally friendly and seamless transport infrastructure. (ii) Carry out timely maintenance on the transport infrastructure to preserve the asset. (iii) Facilitate the mobilization of local and international resources to speed up transport infrastructure development in an integrated manner. (iv) Enable the transport sector to contribute to the growth, leading to better distribution of income and therefore to the struggle against poverty and hence achieve sustainable socioeconomic development and integration. (v) Foster and catalyze the involvement of public-private sector partnerships. (vi) Ensure gender mainstreaming in all issues related to the transport development. (vii) Ensure that transport development takes on board issues related to the disadvantaged groups, e.g. woman and children, physically disabled persons, rural communities, etc. (viii) Enhance efficiency of transport services internationally, nationally and locally. Implementation of TSIP Phase I of the TSIP will be implemented over a period of five years starting 2007/08 up to 2011/12. It will focus on prioritized projects from all transport sub sectors. The prioritization criteria are as follows: (i) The on going projects which will necessarily have to come on board the program. (ii) Studies that are required to determine viability of identified projects. (iii) Projects which already have feasibility studies in place and whose financing has been identified. (iv) Projects of regional nature (i.e. projects which promotes regional integration) including development corridors. (v) Projects which improve urban mobility. (vi) Projects which enhance agriculture productivity promote food sufficiency, enhance export promotion, and those which support and enhance manufacturing. (vii) Projects that enhances multimodal transport. (viii) Projects focusing on attracting foreign investments enhancement such as mining and tourism. RESOURCE REQUIREMENT FOR TSIP (PHASE ONE) The programme resource requirement for the Phase One of the TSIP is USD 6, million for implementing various development projects, maintenance of existing facilities, institutional support and cross cutting issues. This amount will be distributed over the five years period according to plans for implementing the different projects. This TSIP programme has taken into account the current MTEF at least for the first year of its implementation. The Government will put extra efforts to identify other sources of funds to implement the other projected programme interventions beyond 2007/08. xiii

15 Table 7.21: Summary of the Transport Sector Investment Requirement (USD Millions) Phase 1 of the TSIP. SN Programme Component 2007/ / / / /12 Total 1 Roads , , Air Transport Railways Maritime Transport Institutional Support Cross Cutting Issues Grand Total , , , , , Source: MID According to a World Bank on-going Study entitled Africa Infrastructure Country Diagnostic: Transport: Roads, Railways, Ports, Airports, Urban Transport 1, it is estimated that Tanzania will need to invest at least USD 12,989 million in order to meet the basic scenario i.e. accessibility standards applicable to developed and Middle Income developing countries that will increase Tanzania s competitiveness of the economy and to improve social cohesiveness. Therefore, the total TSIP investment of just about USD 5,000 million in five years is about 40% of the investment required. This implies that Tanzania will have to sustain this level of investment in the next 10 to 15 years to be able to meet the basic scenario objectives. Furthermore, the report noted that Tanzania will need to spend at least 8.4% of GDP to sustain this level of investment. Consequently, the Government wishes to call on the developing Partners and the Private sector to increase their level of investment in the transport sector as the study recommended that Government can affordably invest into the Transport Sector only 8.4% of GDP (USD 1,857 million estimate) equivalent to USD156 million annually. Out of the required USD 6, million, USD 2, million or 40% has already been committed or secured. Therefore the identified funding gap in this programme is about USD 3, million or about 60%. The financing gap will be bridged by Government revenues, donor assistance, loans from financial institutions and the private sector. The financing of TSIP will enable the attainment of the MDGs, National Vision 2025, MKUKUTA and the National Transport Policy. During the implementation of TSIP, priority is being focused on the involvement of private sector in the development of transport infrastructure through public private partnership (PPP) concept in areas where the private sector can easily invest alone or in partnership with the public sector. PPP is being considered as a unique option for engaging private sector capital in the improvement of transport infrastructure and services, through a sense of share of investment risks with the public sector. The packaging of the Corridors Development initiatives is a good case in point on how the private sector is going to get involved. FINANCING THE TSIP PROGRAMME Traditional Sources of Funding The First Phase of the TSIP (2007/ /12) is estimated to cost USD 6, million out of which USD 2, million or 40.0% has already been committed or secured through the traditional sources of funding mainly the GOT and the DPs with contributions from own funding in the case of Sea Ports, Air Ports and Railways, and PPP for targeted projects in maritime, air and railway transport. The identified funding gap in this programme is about USD 3, million or about 60.0%. For maritime, air and railway projects, it is hoped that the financing gap will be bridged by Government revenues, donor assistance including non-traditional donors who the Government is 1 Findings of the on-going Africa Infrastructure Country Diagnostic Transport: Roads, Railways, Ports, airport, Urban Transport by Vivien Foster and Robi Carruthers, World Bank presented at the SSATP Annual General Meeting in Ouagadougou, Burkina Faso 5-7 November xiv

16 approaching, loans from financial institutions, and to large extend the private sector through PPPs. However, for the road sub-sector which is traditionally funded solely by Government and Development Partner assistance, Government thinking is to find alternative ways of financing the national road network. Private Sector Participation The Government of Tanzania, like most governments of the developing world, is constrained with a narrow domestic tax base to raise finances required for implementing its development agenda. Moreover, the existing state of socio-economic infrastructure is another impediment for attracting investments to the magnitudes sufficient to defray the development financing gap. Furthermore, official development assistance has not been able to fill the gap. To sustain progressive socioeconomic development, therefore, Tanzania requires innovative tools for financing development projects in order to expand its production frontier as well as improve economic competitiveness. Therefore, during the implementation of TSIP, the priority will be on the involvement of private sector in the development of transport infrastructure through public-private partnership (PPP) concept in areas where the private sector can easily invest alone or in partnership with the public sector. PPP is being considered as a unique option for engaging private sector capital in the improvement of transport infrastructure and services, through a sense of share of investment risks with the public sector. The packaging of Performance Based Management and Maintenance of Roads contracts initiatives is a good case in point on how the private sector is going to get involved. In addition MOFEP through the Central Bank can appoint international and local banks to issue infrastructure bonds to finance the gap in the investments required to implement TSIP or the stabilization program of the national road network to be prepared by December Roadmap for Private Sector Participation in Infrastructure Development The Government is committed to ensuring that more resources are mobilized for infrastructure development from the private sector through Public-Private Partnerships. Therefore, a roadmap to this commitment is as follows: (i) MOID will ensure that the Draft National PPP Policy reaches the Cabinet for approval by August 2008 and that an appropriate institutional framework is put in place by September A Nucleus PPP Unit should be set-up in Ministry of Finance and Economic Affairs (MOFEA) to kick-start PPP and infrastructure bond projects by September A critical mass of a cadre of staff with PPP knowledge is being created through 3 tailor-made courses being offered here in Tanzania by the IP3 - Institute for Public-Private Partnership through World Bank assistance, a total of 140 staff would have been trained by September The course has been advertised to all MDAs. (ii) MOFEA is urged to commit the Central Bank to accept the idea of issuing infrastructure bonds to finance gaps in critical sectors such as roads, energy, etc. so that programmes designed to leapfrog Tanzania to a medium developed country are fully funded. Pronouncement on this should be made by September Thereafter, the MOFEP and the Central Bank can make appropriate preparatory work that can allow international and local banks to participate in issuance of infrastructure bonds. Experience of Ghana and South Africa can be sought. (iii) MOID will come up with a shortlist of suitable transport projects for PPP and other Ministries should do the same under the coordination of the Nucleus PPP Unit in MOFEP. This must start immediately within the Ministries while waiting for the setting up of the PPP Unit. (iv) Advertisements for PPP projects will be done by January 2009 so that the projects can be incorporated in the 2009/10 budget process. The proposal for private sector participation in infrastructure development may not solve the immediate funding gap in 2008/09 however the Ministry will make concerted efforts to ensure that on-going road projects are fully funded in 2008/09 while ensuring that alternative financing modalities come into play in 2009/10. xv

17 MONITORING AND EVALUATION The Monitoring and Evaluation framework for the TSIP has been designed to be compliant with the National Development Vision The benchmarks and indicators of TSIP are also based on those of the vision Monitoring will be conducted to track progress of activities and achievements of predetermined targets and provide an early warning when things go particularly bad. Evaluation will be periodically carried out with a view of outlining the achievements, effects and impact of TSIP in relation with poverty eradication and economic development. xvi

18 1.0 INTRODUCTION 1.1 Background T CHAPTER 1 ransport is an important sector in the whole process of development and poverty alleviation. Its effectiveness, appropriateness and adequacy contribute a lot to the successful implementation of socioeconomic activities. The impact of having such a transport system is lowering of domestic production cost through timely delivery, enhancing economies of scale in the production process and creating economic opportunities. The economic opportunities include ease of market access; strengthening of competition; promotion of trade, tourism and foreign investment; contribution to government revenue and generation of a large number of employment opportunities. In spite of all the above, the transport sector in Tanzania is still characterized by high cost, low quality of services due to various reasons including the existence of massive backlog of infrastructure maintenance and rehabilitation, inadequate capacity caused by low level of investment in resources, and low level of enforcement of safety, environmental sustainability and gender issues. These transport sector problems have by far impeded socio economic development and poverty reduction in Tanzania. It is the intention of the 4 th Phase Government in Tanzania to ensure that transport sector plays its rightful role of facilitating other socio economic sectors to attain their aspirations. The approach will be done along the existing national strategic goals that will be addressed to ensure that: All the trunk roads are paved by 2018 All Regional centers to be linked with paved roads and all district headquarters to be linked with all weather roads of at least gravel standard by The railway network is effectively utilized in such a way that distance bulky goods are carried by railways in a more cost effective way. All major airports are operating at international standards while the domestic ones remain operational all year round. Private sector participation is enhanced in infrastructure investment Rural and Urban Accessibility are improved Transport safety & security are enhanced. Seaport capacity is expanded from the current 10,000 million tons to about 20,000 million tons per year. Previously, Tanzania has implemented a number of transport development and maintenance programmes aimed at enhancing the provision of efficient, cost-effective and a safe transport system in the country. These include Transport Sector Recovery Programme (1987), Integrated Roads Project (IRP) Phase I and II ( ), Railway Restructuring Project (RRP), Port Modernization Project (PMP), the TAZARA Ten-Year Development Programme and the Phase One of the 10-Year Road Sector Development Programme ( ). Reforms have also been on-going with a view of creating institutional arrangements, laws, regulation and procedures that are consistent and compatible with each other to create a conducive climate for investment and hence growth of the sector. The reforms include but are not limited to, formation of relevant regulatory authorities and operational agencies, formation of executive agencies, privatization of operations that can best be done by the private sector, and the recent merging of the then Ministry of Works (MoW) and that of Communications and Transport (MCT) to form the Ministry of Infrastructure Development (MoID). Now that all Transport sub sectors are under one roof, the Ministry of Infrastructure Development has decided to have in place a Transport Sector Investment Programme (TSIP) for developing the transport sector in a holistic manner. This programme is a continuation of previous programmes in the 1

19 transport sector the latest being the 10-Year Road Sector Development Programme (10-YRSDP). Studies have been undertaken during the past ten years aimed at identifying critical issues and hence supporting the efforts to strategies and come up with plans that will bring quick impact to the sector and to the economy in general. Some of the studies include: (i) National Transport Sector Strategic Plan and Transport Infrastructure Master Plan Study for Tanzania Mainland (2002) (ii) Airport study (1999) (iii) Establishment of a Land Transport Commission (2000) (iv) Guidelines for Environmental Management, Design and Implementation of Transport Projects (2001) (v) Ten-Year Road Sector Development Programme (2002) (vi) National Road Safety Master Plan Study (2004) and (vii) Transport Sector Strategic Environmental Assessment study Based on these studies and previous development and rehabilitation programmes, the main objective of having the programme is to ensure that development of the sector is done in such a way as to enable the sector to contribute effectively to the growth of the national economy and eradication of poverty. The TSIP is founded on the National Development Vision 2025 which takes into account the UN Millennium Development Goals (MDGs). Further, TSIP is intended to provide a major input to the National Strategy for Growth and Reduction of Poverty (NSGRP or MKUKUTA as it is popularly known). In essence TSIP is an engine to implement the National Transport Policy (NTP) formulated in 2003 and other national policies geared to improve the well being of the people. The MKUKUTA identifies the poor state of the rural road network as one of the major constraints on development and poverty reduction. However, the transport network operates as a system and not a series of discrete elements. Therefore, improving access requires improving and maintaining physical infrastructure at all levels of the network. Moreover, infrastructure without transport services does not constitute an operational transport system nor does it lead to increased mobility. Attention has to be paid to promoting and facilitating transport services and different transport modes. Urban areas are the dynamos of the country s economy and generate the demand for goods from rural areas for internal consumption and for export. A steep increase in traffic in urban areas is a sign of a growing economy. However, high traffic congestion leads to economic inefficiencies that will eventually constrain growth as well as producing undesirable externalities such as high pollution and increased road traffic crashes. For this reason, achievement of the MKUKUTA goals requires a holistic approach to transport infrastructure development that embraces all levels of the network for all available modes of transport in urban and rural areas. The MKUKUTA strategy is based on three clusters: Cluster I: Growth and the Reduction of Income Poverty Cluster II: Improvement of Quality of Life and Social Well-Being Cluster III: Governance and Accountability Transport is primarily associated with Cluster I and Cluster II. However, transport is a facilitator for many other sectors and activities; and as such it impacts on all Clusters and is an important element in direct improvements in the livelihoods of all Tanzanians. The National Transport Policy (2003) describes how all elements of the transport sector, including different modes of transport, will contribute to the achievement of national social and economic goals. The vision of the Transport Sector is to have Safe and efficient transport services for all. Hence, the strategy will be to enhance modal integration, development of transport corridors, and enhancement of multimodal transport system paying particular attention to issues of safety, environment and security. 2

20 Currently, transport services are provided at high freight and travel charges. Travel time is also high due to condition of the infrastructure, which in turn leads to high vehicle operating costs and high accident rates. It has been estimated that vehicle operating costs in Tanzania are two to three times those in developed countries. These challenges impede the role of transport sector of facilitating other sectors to achieve their aspirations. In view of these facts, there is a need for the transport sector to have an investment programme that looks at the sector in a holistic manner in terms of transport infrastructure development and maintenance. The immediate objective of the programme is to have in place a transport system that facilitates other sectors to attain their aspirations. In the end the attainment of these aspirations will lead to sector development and hence attainment of the MDGs, National Vision 2025, MKUKUTA and the National Transport Policy s objectives and goals. TSIP will be implemented in two phases. The first phase has commenced in 2007/08 and will end in 2011/12; and the second phase starts in 2012/13 and ends in 2016/17. The review of TSIP which will be conducted into the fourth year of the programme will provide in more exact terms the basis for the contents of the second phase of the programme. Detailed implementation of the TSIP is provided in the Medium Term Expenditure Framework (MTEF) which is a three-year rolling plan. 1.2 TSIP Goals The goals of this programme are to ensure that: (i) Each fundamental element of transport has been provided in the appropriate quality, quantity and form. (ii) All elements of transport are combined in a technologically optimum way for each mode of transport. (iii) Each mode is operated in a most efficient way. (iv) Appropriate mechanisms exist to ensure effective inter-modal coordination and communication between the user, the operator, the regulatory agency and the government on all transport questions and issues. 1.3 The TSIP Objectives The objectives of TSIP are as follows: (i) (ii) (iii) (iv) (v) (vi) (vii) Develop adequate, reliable, cost effective, efficient, safe, environmentally friendly and seamless transport infrastructure. Facilitate the mobilization of local and international resources to speed up transport infrastructure development in an integrated manner. Enable the transport sector to contribute to the growth, leading to better distribution of income and therefore to the struggle against poverty and hence achieve sustainable socio-economic development and integration. Foster and catalyze the involvement of public-private sector partnerships. Ensure gender mainstreaming in all issues related to the transport development. Ensure that transport development takes on board issues related to the disadvantaged groups, e.g. woman and children, physically disabled persons, rural communities, etc. Enhance efficiency of transport services internationally, nationally and locally. 1.4 Preparation of TSIP The Ministry of Infrastructure Development, working together with all the relevant stakeholders, has prepared the TSIP. The stakeholders who have been directly and fully involved include: Prime Minister s Office Regional Administration and Local Governments (PMO-RALG); Transport Agencies including: Tanzania National Roads Agency (TANROADS), Tanzania Ports Authority (TPA), Tanzania Airports Authority (TAA), Tanzania Reli Asset holding company (RAHCO) & 3

21 Tanzania Railways Limited (TRL), Tanzania Zambia Railway Authority (TAZARA); the Roads Fund Board (RFB); Transport Regulatory Authorities such as the Tanzania Civil Aviation Authority (TCAA), the Surface and Maritime Transport Regulatory Authority (SUMATRA); Contractors Registration Board (CRB), National Construction Council (NCC), Engineers Registration Board (ERB), Architects and Quantity Surveyors Registration Board (AQSRB); transport facilitation agencies like the Tanzania Meteorology Authority (TMA); and Training institutions, which are; National Institute of Transport (NIT), Dar-es-Salaam Maritime Institute (DMI), Morogoro Works Training Institute, Kigoma Meteorology College, Mbeya Appropriate Technology Institute, Tabora Railway College and Civil Aviation Training College. The Development Partners have given their input into TSIP through the Forum and the Joint Technical Committee, and the Private sector has also been involved through workshops and/or one to one discussions and dialogue. Various inputs have also been collected from other ministries including Ministry of Energy & Minerals, Ministry of Agriculture, Food and Cooperatives, Ministry of Natural Resources and Tourism, Ministry of Public Safety, Ministry of Finance, Ministry of Planning, Economy and Empowerment (MPEE), and the Vice President s Office, etc. 1.5 Structure This document has been organized into 8 Chapters. Chapter 1 presents an Introduction; while chapter 2 highlights on the Tanzania Profile and Economic Background; Chapter 3 deals with the Transport Policy Framework while Chapter 4 discusses the National Transport System; Chapter 5 is on Institutional Reforms and major Stakeholders in the Transport sector, while Chapter 6 discusses Transport Sector Performance review (2001/ /06). Chapter 7 summarizes the Ten-year Transport Sector Investment Programme Phase 1 (2007/ /12). Monitoring and Evaluation has been summarized in Chapter 8. Also, included are Annexes which provide details of Proposed Projects for TSIP implementation in Phase 1 and Lists of Important Stakeholders in the transport sector. 4

22 CHAPTER ECONOMIC BACKGROUND AND PROFILE OF TANZANIA 2.1 Geographical Location and Natural Condition T anzania lies between latitude 1 o S and 11 o S and longitude 29 o E and 41 o E. It is bordered by the Indian Ocean to the East, Kenya to the North, Uganda to the North West, Malawi, Zambia and Mozambique to the South, Democratic Republic of Congo, Rwanda and Burundi to the West (Map 2.1). It has a total area of 945,087 km 2 of which 6.3% is water and 93.7% is land. Arable land accounts for 46% of the total land area while the land under permanent cultivation is just above 10% of the total land with irrigated land at 1550 km 2 (0.2%). Map 2.1: Tanzania Source: MID The Tanzanian population is now estimated at about 38 million people. The population has been growing at an average rate of 2.65%. In addition, Tanzania is an important transit gateway for six landlocked countries of Southern and Central Africa namely Malawi, Zambia, Democratic Republic of Congo (DRC), Burundi, Rwanda and Uganda. This is due to the country being bordered by sea with a coast line of over 700 Km long with import sea ports of Dar es Salaam (the major port), Tanga 5

23 and Mtwara. In serving as a transit country, Tanzania implements the international convention that requires countries with sea to allow land locked countries to use sea ports for importation and exportation of goods. 2.2 The Economy Tanzania's economy has generally been growing relatively rapidly in recent years with substantial improvement being made in sustaining macroeconomic stability following successful implementation of substantial economic reforms. There has bee a steady growth of GDP between 2000 and The country s average GDP annual growth rate for the period 2000 to 2006 was 6.0%. In 2006, the GDP grew 6.2% compared to 4.8% in 2000 (Table 2.1). Table 2.1: Real Growth for Various Key Sectors SECTOR GROWTH Agriculture Mining Manufacturing Electricity and Water Construction Wholesale and Retail Trade Transport and Communications Finance, Insurance, etc Public Administration Less Financial Services Indirectly Measured GDP Source: National Bureau of Statistics On average, GDP has been increasing for the past six years and it is expected to go further up and reach 7.5% in The increase will be due to improvements in the performance of the productive and service sectors e.g. agriculture, manufacturing, mining, tourism and trade. Service sectors are also expected to grow. Specifically transport sector growth rate has been fairly constant at around 6.2%. The goal is to reach 10% annually by 2009 and further up to 12% by Faster growth of the transport sector is highly desirable so that it can cope with demand exerted by growth upsurge in other sectors. This will enable meeting the aspiration of the 4 th Phase Government of having a transport sector that adequately supports other socio economic sectors to meet their aspirations leading to growth and thus attain poverty reduction strategies set in the MKUKUTA. Fiscal performance, which ensures macroeconomic stability and high growth, has significantly improved. Inflation went down from 16.1% in 1997 to manageable annual average of less than 5.0% in The level of foreign exchange reserves exceeded the projected level of 4 months of imports of goods and services reaching 9 months worth of imports in

24 CHAPTER TRANSPORT POLICY FRAMEWORK 3.1 Transport Sector Vision The Vision of the Transport sector is to have safe and efficient transport services for all. 3.2 Transport Sector Mission The Mission is to provide reliable and fully integrated transport infrastructure and operations which will best meet the needs of travel and transport at improving levels of service at lower costs in a manner, which supports government strategies for socio economic development whilst being economically and environmentally sustainable. 3.3 The National Transport Policy and Implementation Strategies The National Transport Policy (NTP) was formally approved by the government in year Having approved the NTP, the Government embarked on preparing the Policy Implementation Strategies to translate the policy guidelines into time bound actions and activities. The objectives of the Strategy, among other things, are to ensure optimal use of resources by investing in improved infrastructure in all modes of transport; promote modal efficiency; enhance competition, recover some of the cost from the users and support the overall socio economic development in a most cost effective manner. In order to come up with a policy framework to guide the planning, management, operations and monitoring of the transport sector, various studies and evaluations of the sector have been undertaken (Section 1.1). These studies formed the basis of formulating the NTP, its Implementation Strategies and the TSIP. Considering the above facts, the government is committed to putting in place and reviewing policies, strategic goals, monitoring and evaluation of sector performance, legislative issues and all aspects of good governance. The government is also committed to ensuring that infrastructure issues are overseen largely by the government. On the other hand, regulatory issues are now handled by the government at arms length largely through autonomous executive agencies while service provision is handled to a large extent by operational public or private institutions. Commercially oriented institutions, including public private sector partnership (PPP) handle most operations or services provisions which have commercial sense. The main goal of NTP is to facilitate the achievement of the National Development Vision 2025, the 2015 UN Millennium Development Goals, and the goals of the National Strategy for Growth and Reduction of Poverty. This facilitation requires the streamlining of the NTP with the other national and international policies. The implementation of the TSIP is taking on board the requirements and aspirations of both national and international policies. Successful implementation of TSIP projects in the identified area of focus will enable the policy guidelines stipulated in the NTP to become operational. 3.4 Joint Assistance Strategy The Joint Assistance Strategy for Tanzania (JAST) is a national medium-term framework for managing development co-operation between the Government of the United Republic of Tanzania (Government), and Development Partners (DPs) so as to achieve national development and poverty reduction goals. It also outlines the role of non-state actors to the extent that they contribute to the successful implementation of the Strategy. The overall objective of the JAST is to contribute to sustainable development and poverty reduction in line with the National Development Vision 2025 by consolidating and coordinating Government efforts and Development Partners support under a single Government-led framework to achieve results on the National Strategy for Growth and Reduction of Poverty. 7

25 The JAST has been formulated in the spirit of national and international commitments and initiatives on aid effectiveness. It spans a renewable cycle of five years and outlines the main objectives, principles and broad arrangements of Tanzania s development partnership. It is complemented by an Action Plan that specifies concrete activities and time-frames for implementing JAST and a monitoring framework with indicators to measure Government and Development Partner performance. As the overarching strategy for guiding the use of external resources to support the implementation of the MKUKUTA, the JAST promotes the strengthening of underlying sector processes through effective participation in dialogue by all stakeholders whereby relevant Government, Development Partner and non-state actor stakeholders are expected to participate in sector dialogue especially by using Sector-Wide Approaches (SWAPs). SWAPs are instruments for organising sector dialogue around strategic issues and overall policy directions rather than for deciding on the provision of funding. Stakeholders engage in transparent and timely sector dialogue, particularly for scrutinising spending plans, assessing performance in implementing sector policies, strategies and plans, the effectiveness of budgeting and execution and its link to the MKUKUTA as well as linkages with other sectors, and for informing decision-making at sector level. The sector reviews consider the effectiveness of Development Partner supported programmes and projects in contributing to MKUKUTA outcomes. Outputs of sector dialogue feed into cluster and national processes (e.g. MKUKUTA National Budget / Public Expenditure Review (PER), and General Budget Support (GBS) review. Their timing and scope will therefore be aligned to these processes. Although JAST will guide overall sector-level dialogue improvement, specific actions to enhance dialogue will be decided by each sector, reflecting different degrees of maturity in terms of capacity and institutional setup. 3.5 Joint Infrastructure (Transport & Communications) Sector Review (JISR) In pursuit of SWAP, the Ministry of Infrastructure Development held its first Joint Infrastructure Review in the areas of Transport and Communications in October, Outputs of the JISR were valuable inputs for feeding into MKUKUTA Cluster 1 GBS Review which was held later in October/November Sector Wide Approach (SWAPs) Various efforts will be made to practice SWAPs in the transport sector. The approach will include the effective means to enable Transport sector strategy derived from the existing National Transport Policy as well as putting in place sustainable mechanisms for the Government-led donor coordination. On one hand, the Joint Technical Committee (JTC) will continue to be used as a team of experts from the two sides to advise the sector on sector reforms and other important issues impacting implementation of the TSIP. On the other hand, a reliable transport sector performance monitoring indicator framework for the transport sector has been developed to link with the National Strategy for Growth and Reduction of Poverty (NSGRP) or MKUKUTA. 3.7 PPP Policy and Institutional and Regulatory Framework In order to involve non-state actors (private sector and civil society) in participating in transport sector investment, Government is making concerted efforts to put in place a PPP policy, institutional and regulatory framework by December The Government through MoID undertook a study on the framework for PPPs in the road sector and through the study, opportunity areas for PPP investments in the road sector have been proposed. While the opportunities for PPP in the road sector currently appear to be limited, prospects exist in other transport sub-sectors. It is the intention of the government to effectively involve private sector in the execution of the infrastructure development projects. 8

26 CHAPTER THE NATIONAL TRANSPORT SYSTEM T he current Tanzanian transport system consists of road, rail, air, water and pipeline modes. According to the Economic Survey of 2006, the Transport & Communications sector contributed 5.4% to the GDP while the construction sector contributed 5.8%. 4.1 Road Transport Tanzania has presently an estimated total road network length of 85,000 km. Out of the total road network, the urban, district and feeder roads with a total length of 56,625 km are under jurisdiction of PMO -RALG. The Ministry of Infrastructure Development through TANROADS is responsible for administration and management of the trunk and regional roads network. The length of the road network under the jurisdiction of MoID is 28,892 km. of which trunk roads amounts to 9,934 km and regional roads amounts to 18,958 km. PMO-RALG has carried out an inventory and condition survey of its road network known as Local Government Road Inventory and conditions survey (LG-RICS). The field work was completed in November The Tables 4.1 and 4.2 show the lengths of the different classes of roads and their conditions. Table 4.1: Condition of Trunk and Regional Roads (June 2007) Road Type Good (km) Fair (km) Poor (km) Total Trunk -Paved -Unpaved 2, (70%) 1, (32%) (23%) 2, (41%) (7%) 1, (26%) 3, (100%) 6, (100%) Sub-Total 4, (47%) 3, (34%) 1, (19%) 9, (100%) Regional Roads -Paved -Unpaved (85%) 7, (38%) (13%) 7, (39%) 6.55 (2%) 4, (23%) (100%) 18, (100%) Sub-Total 7, (39%) 7, (38%) 4, (23%) 18, (100%) Total 12, (42%) 10, (37%) 6, (21%) 28, (100%) Source: TANROADS Table 4.2: Condition of Local Government Roads (LG-RICS, November 2006) Road Type Good Condition Fair Condition Poor Condition Bad Condition Total Km % Km % Km % Km % (Km) District Roads 4, , , , ,536 Feeder Roads 2, , , , ,191 Urban Roads 1, , , ,898 Total 7, , , , ,625 Surface type: Earth 46,410km (82.0%), Gravel 9,425km (16.6%) and Paved/Sealed 790km (1.4%) Source: PMO-RALG From the Tables 4.1 & 4.2 above, it is seen that: The total trunk and regional road network that is in good and fair condition (which means maintainable) is about 22,648.7 km (78.4%). 31,241 km (55.2%) of the road network under the responsibility of the local governments is in good and fair condition i.e. maintainable condition. 9

27 The road network density in Tanzania is 96.5 meters per square km (or 5.0 meters per square km for paved roads). Similar statistics for other East African Community member states are shown in Table 4.3. Table 4.3: Summary of Road Densities in Kenya, Uganda and Tanzania Country Particular Measurement Kenya Total Area (sq. km) 582,648 Entire Network (m per sq. km) Paved Network (m per sq. km) 15.2 Uganda Total Area (sq. km) 236,036 Entire Network (m per sq. km) Paved Network (m per sq. km) Not Known Tanzania Total Area (sq. km) 881,000 (Mainland) Entire Network (m per sq. km) 96.5 Paved Network (m per sq. km) 5.0 Source: MoID According to Table 4.3, Tanzania has the lowest road density compared to the other two states of Kenya and Uganda. This means a large part of Tanzania is inaccessible. The inaccessibility, especially in the rural areas, makes travel cumbersome and expensive. In line with the Traffic Count Survey carried out in year 2004 on trunk and regional roads, more traffic is concentrated on paved roads and highest traffic volume is in Dar es Salaam (Map 4.1). The corridors with largest traffic levels are TANZAM and North Eastern Corridor. The AADT on TANZAM corridor ranges from more than 15,000 (Dar es Salaam Kibaha section) to 700 (on Halali -Iyayi section) and traffic on North Eastern corridor range from, 1,000 to 5,000 AADT. The Central corridors have traffic volume ranging from 115 (Nzega- Bukoba) to 7,000 (on Morogoro Wami section) AADT whereas the Lake circuit corridor has traffic volume ranging from 200 to 3,000 AADT. The Great North, Western, Midwest and Southern corridors have much lower traffic, ranging from 100 to 150 AADT. Road traffic crashes are of great concern to the Government. The national figures show a high number of road traffic crashes and casualties. The number of road traffic crashes reported has increased from 7,850 in 1975 to 16,664 crashes in the year 2003 out of which 1788 crashes resulted into 2,155 deaths. Statistics for 2004 also shows that accidents and the number of killed and injured person increased by 7-11%. To address the road safety issues, the National Road Safety Master Plan for 5 years and an Action Plan of the first three years have been prepared. A National Road Safety Policy and its Implementation Strategies have also been prepared. The necessary approval of legal framework to establish meaningful road safety management capacity in Tanzania is in progress. 10

28 Map 4.1: Traffic Volume for Tanzania Mainland (2004) 4.2 Railway Transport Tanzania Railways systems have a total track length of 3,676 km out of which 2,701 km were operated by Tanzania Railways Corporation (TRC) until August 2007 and now owned by Rail Asset Holding Company and operated by Tanzania Railways Limited. The remaining 975 km are operated by the Tanzania - Zambia Railway Authority. The two railways systems link 14 of the 22 regions on the mainland. The present system (Map 4.2) was planned in such a way that it stretches from East to West. For instance the central line connects Mwanza on Lake Victoria and Kigoma on Lake Tanganyika through Tabora and Dodoma to Dar es Salaam. The Tanga line stretches to Moshi and Arusha. The two lines are connected to each other by a link line at Ruvu on the Central Line and Mnyusi on the Tanga line. As is the case with the Central line, the TAZARA line stretches from the port of Dar es Salaam to Mbeya in the south west on onwards to Kapiri Mposhi in Zambia. Apart from the TAZARA system which was constructed in the 1970s most of the Tanzania railway system was constructed at the beginning of the last century; and since then no substantial 11

29 modernization has been done. The gauge is narrow, i.e. 100 cm which is the cause for speed limitations and is prone to accidents. Procurement of parts and equipment is also cumbersome due to the fact that no such parts can be procured off shelve because they are not compatible with those of existing modern systems in the world. The importance of transportation by rail need not be emphasized. Unfortunately very few areas of the country are served by the railway system. The Southern, Western and North Western parts of the country are not served by any railways system. The main challenging areas in as far as railways are concerned include the narrow gauge, speed limitations, long travel time, poor state of wagons and locomotives, land slides and wash away of some rail sections by floods, and very low level of capitalization Rail Asset Holding Company (RAHCO) The RAHCO railway has a design capacity of carrying 5 million tonnes of freight per annum. RAHCO network has a gauge of 1,000 mm and consists basically of two main lines: the Central line running from Dar es Salaam to Tabora (840 km) and from Tabora to Kigoma (411 km) and a major branch from Tabora to Mwanza (378 km). The Tanga line which starts from Tanga to Moshi and Arusha has a total length of 438 km. The two lines are connected by a link line between the Ruvu Junction Station on the Central line and Mnyuzi Junction on the Tanga line (188 km). Also, the system has four branch lines i.e. Kilosa-Kidatu (107 km), Kaliua-Mpanda (214 km), Manyoni-Singida (115 km), and Kahe-Border (16 km). The Tanzania Railway Limited, the operator for RAHCO has holding fleet of 120 diesel locomotives, out of which 85 are operational. 103 locomotives, that is almost 84% are older than 20 years. The wagon holding fleet is 1,847 of which 1514 wagons are older than 20 years. The wagon fleet has 888 covered wagons; 216 tanks; and 188 containers. The locomotive and wagon availability is between percent. 12

30 Map 4.2: The Railway Network Kigali Musoma A= Central Line B= Tanga Line C = Link Line D=Mwanza Line E=Mpanda Line F = Singida Line G = Kidatu Line Sumbawanga Makambako Mtwara Source: MID Tanzania Zambia Railway Authority (TAZARA) The Tanzania-Zambia Railway Authority (TAZARA) operates a railway line between the port of Dar es Salaam and New Kapiri Mposhi in Zambia over a distance of 1860 km of which 975 km are on the Tanzanian territory. TAZARA has a gauge of 1,067 mm, which conforms to other Central and Southern African railway networks. The railway has a design capacity of carrying 5.0 million tonnes of freight per annum, i.e. 2.5 million tonnes in each direction, and 3.0 million passengers per annum. The rolling stock of TAZARA consists of 22 serviceable mainline locomotives, of which 17 can be considered as operational fleet. TAZARA has 1,500 wagons of which average of 1,200 are operational. Also, TAZARA has 128 passenger coaches of which 70 are operational. The locomotives and wagons availability is about 50 percent and 65% respectively. 4.3 Maritime and Inland Waterways Tanzania maritime transport is concentrated at the major sea ports, which are Dar es Salaam, Tanga and Mtwara managed and operated by Tanzania Ports Authority (TPA) and Inland water transport with ports in Lakes Victoria, Tanganyika and Nyasa managed by Marine Service Company Ltd (Map 4.3). Smaller ports are Kilwa, Lindi, Mafia, Pangani and Bagamoyo. The total traffic handled at the major three ports has been increasing on average of 8% annually from million tons of cargo handled in 2001 to million tons handled in 2006 (Table 4.4). Inland shipping is currently undertaken on Lakes Victoria, Tanganyika and Nyasa. The major ports are Mwanza, Bukoba and Musoma on Lake Victoria, Kigoma on Lake Tanganyika and Itungi in Lake Nyasa. 13

31 Map 4.3: Sea and Inland Ports Source: TPA Key Sea Ports Inland Ports Table 4.4: TPA Port Throughput ( 000 DWT) Imports 3,684 3,809 4,242 4,958 5,067 5,548 Exports ,158 1,214 1,322 1,314 Transshipment & Bunkers Grand Total 4,684 4,972 5,646 6,548 6,794 7,291 Source: TPA The Port of Dar es Salaam has 11 berths and a total quay length of 2,000 m. The total capacity is 3.1 million tons of break bulk; 6 million DWT of bulk liquid capacity and 250,000 TEU at the container terminal. The crude pumping capacity is 5,000 tons/hour and the pumping capacity for refined products 600 tons/hour. The storage capacity of the grain terminal is 30,000 tons. The port of Tanga has a rated capacity to handle 500,000 tons of general cargo per year, and the total capacity of the port of Mtwara is 400,000 tons. Inland waterways shipping services are currently undertaken on Lakes Victoria, Tanganyika and Nyasa. The major ports are Mwanza, Bukoba and Musoma on Lake Victoria; Kigoma on Lake Tanganyika; and Itungi on Lake Nyasa. A government owned Marine Service Company (due for privatization in the near future) and private operators render marine service on the three lakes. On Lake Victoria, international services are provided by rail ferry. There is also significant informal coastal shipping around the Lake. 14

32 4.4 Air Transport Tanzania has a total of 368 aerodromes which are owned, managed and operated by different entities. Tanzania Airport Authority (TAA) owns, manages, operates and develops 62 airports. There are four International Airports namely; Mwalimu Julius Kambarage Nyerere, Kilimanjaro, Zanzibar and Mwanza. Out of four International Airports, two of them have been managed by TAA; namely Mwl. J. K. Nyerere and Mwanza International Airports. Zanzibar International Airports is being managed by The Revolutionary Government of Zanzibar. KIA was leased by to a private operator since Map 4.4 overleaf indicates existing international and domestic airports in Tanzania. The Tanzania Airports Authority (TAA) distinguishes four types of airports: (i) (ii) (iii) (iv) International airports: Mwalimu J. K. Nyerere, Kilimanjaro, Zanzibar and Mwanza Strategic airports: Arusha, Lake Manyara, Mafia and Ngara. Major Domestic airports:, Mtwara, Dodoma, Kigoma, Tabora, Mbeya, Songwe, Songea, Lindi, Shinyanga, Musoma, Bukoba, Sumbawanga, Tanga and Lake Manyara. Small airports. The condition of basic airport infrastructures (runways, aprons and taxiways) for most of the airports in Tanzania is very poor., With exception of 3-International airports and 8-major region airports which have asphalt surfaces, the rest of airports have gravel and grass runways. As a result, safe accessibility is only during dry seasons. It s only the 3-international airports and Mwanza airport which have airfield ground lighting system that allow for 24 hour airport operations. Table 4.5 outlines the physical condition of airport infrastructure. 4.5 Pipeline Transport There are only two functional long distance pipelines in the country. The TAZAMA pipeline which transports crude oil from Dar es Salaam to Ndola refinery terminal in Zambia, a distance of 1,750 km. The pipeline that transports gas from Songo-Songo Island to Dar es Salaam with a distance of 232 Km. the pipeline is owned by SONGAS. 4.6 Development Corridors A Development Corridor is a concept founded in the idea of Spatial Development Initiative (SDI) intended to attract export driven investments and stimulate public/private partnership to areas with under or unutilized potential. It considers all potentials for multi-sectoral integrated development built around a backbone transport infrastructure linking the region to gateway for international trade. It recognizes the inter-dependence of various sectors, facilitates easier and faster decision making, and provides very good approaches and mechanisms for packaging of development programmes. Development of transport corridors has been one of the main strategies adopted by the Government towards the facilitation of the transit trade and ultimately implementation of Almaty Declaration and Programme of Action. 15

33 Map 4.4: Existing Domestic and International Airports Source: Tanzania Airport Authority Domestic and International Airports 16

34 Table 4.5: Physical Condition of Existing Airport Infrastructure SN Name of Airport Runway dimensions Surface type and condition Pavement strength 1 Mwl. J. K. Nyerere International 3000mx46m Bitumen(Excl) PCN 60 2 Kilimanjaro International 3607mx45m Bitumen(VG) PCN60 3 Zanzibar International 2462mx45m Bitumen(P) PCN 42 4 Mwanza 3300mx45m Bitumen(VG) PCN 60 5 Mtwara 2258mx30m Bitumen(G) PCN32 6 Dodoma 2042mx30m Bitumen(P) PCN15 7 Tanga 1268mx31m Bitumen(P) PCN15 8 Moshi 1480mx30 Bitumen(VP) Not available 9 Kigoma 1767mx30m Gravel (G) PCN15 10 Tabora 1786mx46m Gravel (G) PCN32 11 Bukoba 1058mx28m Gravel (G) 5700kg 12 Musoma 1600mx33m Gravel (G) PCN15 13 Shinyanga 2000mx30m Gravel (P) 5700kg 14 Mafia Island 1600mx30m Gravel (VP) Not available 15 Lake Manyara 1220mx21m Gravel (P) 5700kg 16 Singida 1070mx70m Glass (P) 1800kg 17 Mbeya 1500mx30m Glass (G) 16970kg Source: TAA Note: Pavement Condition defined as: Excl - Excellent VG - Very Good G - Good P - Poor VP - Very Poor PCN - Pavement Classification Number Tanzania serves as a transit country for import and export of Malawi, Zambia, DR Congo, Burundi, Rwanda and Uganda, using the port of Dar es Salaam. The main rail and road connections in Tanzania are, therefore, in east-west direction linking the ports with the hinterland in those neighbouring countries. Tanzania is paying much attention to the development corridors concept in its development policy efforts by concentrating efforts in the Mtwara Corridor, Dar-es-Salaam Corridor, the Central Corridor and the Tanga Corridor. The important challenge is to link import, export and transit traffic from and to neighbouring countries with transport development efforts. Routing transit traffic through Tanzanian should be seen to be an integral part of the national and regional socio-economic development and integration efforts. Map 4.5 showing the brief highlight of the various development corridors. 17

35 Map 4.5: Development Corridors Source: MID Key: Central corridor DSM corridor Tanga corridor Mtwara Corridor 18

36 4.6.1 Dar-es-Salaam Development Corridor The Dar es Salaam corridor, which is sometimes referred to as the TAZARA Corridor, connects the Dar es Salaam Port with Southern and Eastern highland through the TAZARA railway and the Dar es Salaam -Tunduma Highway. The Corridor offers the shortest distance between the port of Dar es Salaam, Zambia, Malawi and the Southern parts of Tanzania. The Corridor faces stiff competition from Mozambican and South African Ports in handling traffic to and from Malawi, Zambia and DRC. During the last 10 years, fundamental political and economic changes have taken place in countries served by Dar-es-Salaam corridor. For instance end of civil wars in Mozambique and DRC have made freighters to have more route options than before. Today most of Malawi traffic is going through Mozambique ports. Major constraints facing the Corridor include: General deterioration in the performance of TAZARA permanent way (track), signaling and telecommunication system, locomotives, wagons and other operating equipment. These are in very bad state, hence there is a need for rehabilitation or replacement Delays due to port cargo clearance resulting from poor over land transportation system contributed especially by the poor performance of TAZARA. Long transit and turn round time due to shortage of equipments, i.e. locomotives and wagons Inadequate return cargo due to unbalanced trade pattern between imports and exports from the south. Inadequate facilities of transshipment of interface points. The potentials of the Dar es Salaam corridor are numerous. The land along the Dar es Salaam corridor is the leading producer of maize which is the leading food crop. Other agricultural products include tea, coffee, pyrethrum and forestry products. Industrial activities include cement, beverages and vegetables and fruits canning. As hinted, this corridor provides the shortest transit route for Zambia and Malawi. Investments to tap the potentials of the corridors are desired. However the importance of this corridor at regional level is in the packaging of both infrastructure and economic projects to make them viable for attracting direct foreign investments Central Development Corridor The Central Corridor originates from the Port of Dar es Salaam and takes the central line route extending to eastern DRC, Burundi via Kigoma on Lake Tanganyika to Rwanda via Isaka Dry Port and to Uganda via Mwanza on Lake Victoria. The corridor offers the shortest distances between the Port of Dar es Salaam and the land locked countries as follows:- Dar Kigoma Bujumbura; Road/Rail and Lake: 1,436 km Dar Kigoma Kalemie; Road/Rail and Lake: 1,374 km Dar Isaka Kigali; Rail and Road 1,463 km Dar Mwanza Portbell; Rail and Lake 1,581 km The major constraints facing the corridor are: Poor condition of the infrastructure for both rail and road Delays to cargo off take especially at the port of Dar es Salaam due to shortage of wagons and low availability of locomotives. Delays to cargo clearance at the port of Dar es Salaam due to incompetence of some Clearing and Forwarding Agents and documentations procedures Lack of navigational aids on the lakes (Tanganyika and Victoria) resulting in unsafe operations Silting of Lake Victoria at Mwanza and Tanganyika at Kigoma and Kalemie. 19

37 Damaged rail and bridges of the Congo Railways (SNCC) on East DRC. Poor condition of the road between Rusumo and Kigali in Rwanda Untimely follow up of the issue of the Corridors agreed at bilateral meetings Through the established Central Development Corridor Bilateral Agreement, a permanent office has been set up based in Kigali, Rwanda, a situation that haunted implementation of decisions relating to the Corridor development Tanga Development Corridor The corridor has great potential to serve the Lake Victoria regions as well as Uganda, Burundi and Rwanda using the Tanga port. Projects which need to be implemented to remove critical bottlenecks along this corridor include; the development of new deep water port at Tanga and construction of Tanga, Musoma - Railway. There are high agricultural potentials, tourist attractions, mineral deposits which make investment in transport infrastructure such as railway line, economically very viable. At the moment there is a railway line joining Tanga with Arusha. There is a good tarmac road stretching from Tanga to Arusha, Makuyuni to Ngorongoro gate. There are also the airports at Tanga, Kilimanjaro, Arusha, Moshi, Lake Manyara and Musoma. Specifically the constraints which need to be addressed during the implementation of TSIP include: Absence of deep water berth at Tanga port Absence of a railway stretch linking Arusha with Uganda, Rwanda and Burundi. Environmental concerns for the possible railway alignment between Arusha and Musoma. Absence of funds for conducting a study to determine socio-economic and environmental viability. The airports along the corridor i.e. Arusha, Musoma and Bukoba which need a lot of improvement Mtwara Development Corridor This is one of the corridors identified to serve SADC countries, namely northern Malawi, Mozambique and North-Eastern Zambia under the Spatial Development Initiatives (SDI). Port development, road and rail construction are critical components for the corridor potential exploitation Specific constraints which will be addressed under the TSIP include: Limited Mtwara Port capacity Absence of both rail and road network linking the port to the hinterland. Mbamba Bay port which need to be developed to allow for transit traffic from Mkata Bay in Malawi, to Mtwara and to overseas Improved infrastructure between the Southern regions of Tanzania and Mozambique through the Unity Bridge to enhance trade and also to boost the Mtwara port throughput. Lead projects which are being packaged under the Mtwara Development Corridor include both of infrastructure and economic nature. Infrastructure projects include: Mtwara Mbamva Bay road; Unity bridge and access roads; Kilambo Namoto Ferry plus access roads; Revitalisation of Lake transport; Chuchuma Coal and Power project; Kiwira (TZ) and Karonga (Malawi) Inter connectors Economic projects whose exploration will depend on infrastructure being in place include: 20

38 Coal exploration; Iron ore exploration; Mtwara gas and industry platform Tourism; and Industry and fisheries 4.7 Road Transport Corridors For reasons of opening up the country and enhancing integration there are nine (9) road transport corridors. The road transport corridors embrace a total road network of about 10,300 km, 40% of which is bituminized. The challenge behind is to bituminize the remaining 60% of the road network on the corridors. The existing road transport corridors include: (i) TANZAM corridor: Dar es Salaam - Morogoro - Mikumi (with a link to Ifakara and Mahenge) - Iringa - Mafinga (with a link to Mgololo) - Makambako - Mbeya (with a link to Itungi Port and Malawi) Tunduma (1324 km). This corridor facilitates agriculture, tourism, mining and trade. It is alos a gateway for the land locked countries of Zambia, Malawi and Eastern Congo (ii) North East corridor: Chalinze Tanga/Moshi Arusha/Himo Marangu Tarakea/Taveta (955 km).this corridor facilitates production of both subsistence and cash crops, promotion of tourism and mining. This corridor links Tanzania and Kenya. (iii) Southern coastal corridor: Dar es Salaam Kibiti - Lindi Mingoyo (508km). Improvement of the road infrastructure of this corridor would promote economic activities in the southern part of Tanzania and is an important regional link to Mozanbique. (iv) Central corridor: Morogoro - Dodoma - Mwanza (on Lake Corridor) - Rusumo (Rwanda border) and Kobero (Burundi border) in the West (1584 km). This corridor serves the designated national capital of Dodoma, the central and western regions of the country and serves the land locked countries of Rwanda, Burundi and to some extent Uganda. facilitates extensive farming and mining. (v) Lake circuit corridor: Sirari (Kenyan border) - Musoma - Mwanza Bukoba - Mutukula (border with Uganda) (1019 km). The lake circuit corridor serves manufacturing and processing industries and promotes agriculture, mining, tourism, fishing and trade. It is an important link to the East African partner states of Kenya nad Uganda.. (vi) Southern corridor: Mtwara Mingoyo Masasi Tunduru - Mbamba Bay on Lake Nyasa (1,024 km). The corridor promotes agricultural production including livestock and fishing, mining, and trade. This is a new corridor that has high potential as it links the Mtwara port to the yet unexploited steel and coal mines of Liganga and Mchuchuma in the southern highlands. It is also a potential gateway for Malawi and Zambia through Mbamba Bay (Lake Nyasa). (vii) Great north corridor: Iringa - Arusha Namanga (1067 km). The northern corridor serves agricultural schemes, mining and tourism. This is part of the historic Great North Road linking Cairo and Cape Town, and has been heralded as an important link of the Trans- African highways. (viii) Western corridor: Tunduma Sumbawanga Mpanda Kigoma - Nyakanazi (1286km). Economic activities along this corridor include agriculture, tourism, mining, timberworks, fishing and gold smiting. (ix) Central Western corridor: Mbeya Rungwe Ipole Tabora up to Nzega (1,201Km). Possible Development activities are forestry, tourism and mining. The challenge is to see to it that there is smooth traffic flow along the nine corridors. During the ten years of the programme all the road sections in the corridors will have to be upgraded to paved standards, which is an important pre condition for unlocking the economic potentials in various parts of the country. 21

39 CHAPTER INSTITUTIONAL REFORMS AND MAJOR STAKEHOLDERS IN THE TRANSPORT SECTOR 5.1 Institutional Reforms I n a bid to contain the economic decline experienced in the 1970s and early 1980s, the Tanzanian government introduced several programs including the Structural Adjustment Program (SAP ), and Economic Recovery Program (ERP) from In the Transport sector, programs such as Integrated Roads Project (IRP), the Railway Restructuring Project (RRP), the Port Modernization Project (PMP), and the TAZARA Ten-Year Development Program were introduced. After the Integrated Road Project I & II, a 10-Year Road Sector Development Program (starting in year 2000) was introduced which was implemented only during its first phase. The second phase of which has been integrated into the TSIP. These programs have run parallel with government restructuring in all other sectors. For instance, the transport sector reforms have been aimed at ensuring that the sector lends deserving support to sustained growth of the productive as well as service social sectors. The reforms embarked on over the past 8 years include: (i) Transforming into semi autonomous agencies those government departments whose functions were of operational or service delivery nature:- Tanzania National Roads Agency (TANROADS), Tanzania Airports Authority (TAA), Tanzania Meteorological Agency (TMA),Tanzania Government Flight Agency (TGFA), Tanzania buildings Agency (TBA) and Tanzania Electrical, Mechanical and Electronic Services Agency (TEMESA). (ii) Establishment of transport regulatory authorities and Boards: Surface and Marine Transport Regulatory Authority (SUMATRA), the Tanzania Civil Aviation Authority (TCAA), Roads Fund Board (RFB), Contractors Registration Board (CRB), National Construction Council (NCC), Engineers Registration Board (ERB), Architects and Quantity Surveyors Registration Board (AQSRB). (iii) Increasing Private Sector Participation in the Transport Sector through concession, divesture and management contractors: The operations of the Dar es Salaam Port Container Terminal, TRL and KIA have been concessioned out National Transport Corporation (NTC) and the Regional Transport Companies (RETCOs) were fully divested in 2002 Modalities for involvement of private sector in TAZARA, Marine Services Company Ltd (MSCL) are being worked out. (iv) Establishment of Roads Fund and Roads Fund Board through the Roads Tolls (Amendment) No 2 Act of (v) Review of the Highway Ordinance which has been replaced by the Roads Act (2007) (vi) Capacity Building Programmes: Under the ongoing reforms several measures have been undertaken to ensure availability and sustainability of local technical and managerial capacity to manage the sector. Review of skills enhancement training programmes to meet needs of local capacity building is also in progress. (vii) Merging the two Ministries of Communications & Transport and that of the Ministry of Works to form the Ministry of Infrastructure Development in 2006 in an effort to reduce fragmentation and disjointed plans in the transport sector. (viii) Implementation of the Local Government Reform Programme (LGRP) in January 2000 and is still on-going. The purpose of the LGRP is to devolve political, administrative, and fiscal responsibilities from central to local government, underpinned by good governance, thereby enabling LGAs to provide more appropriate, equitable, quality services to Tanzanians, especially the poor. The programme will therefore also contribute to better management of the local roads network. 22

40 Further institutional reforms are envisaged to consolidate the implementation of the Transport Sector Investment Programme and the sector in general. For example, TANROADS need to be further strengthened and given more autonomy. Other issues involve road safety and widening the base of and increasing the Road Fund. As a start, in July 2007 the fuel levy was increased from Tshs. 100 to TShs. 200 per liter. The above institutional reforms have been done to link with the national strategic goals and objectives. The government wishes to see to it that provision of transport services is carried out by technically and financially capable institutions. To ensure fair play among service providers and availability of safe services that are environmentally friendly, regulatory mechanisms have been put in place where necessary. With this approach, the government has been left with its key roles of policy formulation, strategic planning and monitoring and evaluation. 5.2 Major Stakeholders Involved in Implementation of TSIP The principal stakeholders involved in one form or another in the implementation of TSIP include Government ministries, departments, regulatory authorities and boards, operational agencies / parastatal, training institutions, financial institutions, development partners and the private sector. These are briefly outlined below and their details are provided in Annex Key Ministries The key Ministries in the transport sector include: Ministry of Infrastructure Development (MID) which is the custodian of the overall transport sector policy development; Prime Minister s Office Regional Administration and Local Government (PMO-RALG) responsible for local roads including district and urban roads; Ministry of Finance responsible for budget allocations and overall financial regulations; Ministry of Planning, Economy and Empowerment responsible for macro policies, planning and strategies; and Ministry of Public Safety and Security responsible for safety & security enforcement matters; Other Ministries The other Ministries include: Ministry of Industry, Trade and Marketing overseeing standards, import procedures, transport equipment; Vice President s Office overseeing environment management; Ministry of Lands and Human Settlement the custodian of land use planning procedures 7 regulations; Ministry of Health and Social Welfare for trauma management; Office of the Attorney General for all legal transactions; Ministry of Science, Technology and Higher Education responsible for training, research in technology & management; Ministry of Education and Vocational Training for capacity building and training of various cadres; Ministry of Agriculture and Cooperatives and Ministry of Natural Resources and Tourism largely their activities facilitated by the transport sector Regulatory Authorities and Boards Transport regulatory authorities include the Tanzania Civil Aviation Authority (TCAA) for air transport, the Surface and Marine Transport Regulatory Authority (SUMATRA) for marine and surface (i.e. road and railway) transport, and Energy and water Regulatory Authority (EWURA). There are also specific regulatory boards including the Engineers Registration Board (ERB), 23

41 Contractors Registration Board (CRB), National Construction Council (NCC) and Architects and Quantity Surveyors Registration Board (AQSRB). Further, there are international regulatory organizations operating in Tanzania including ICAO, IMO, etc Operational Agencies/ Parastatal Organizations Transport sector operation agencies and Parastatal organizations include: Tanzania Ports Authority (TPA); Tanzania Airport Authority (TAA); Tanzania National Roads Agency (TANROADS); Tanzania Government Flight Agency (TGFA), Tanzania Meteorological Agency (TMA); Tanzania Buildings Agency (TBA); Tanzania Electrical, Mechanical and Electronic Services Agency (TEMESA); Railway Assets Holding Company (RAHCO), Tanzania Railways Limited (TRL), Tanzania Zambia Railway Authority (TAZARA), and the Roads Fund Board (RFB) Development Partners (Foreign Countries and International Organizations) Development partners, both multilateral and bilateral, have been playing a key role in supporting the development of infrastructure, improvement in the provision of services and technical assistance. Most of these partners are governments (bilateral) and international development institutions with different priorities in the various transport sub-sectors. They include and not limited to the European Union, Governments of Belgium, Kuwait, Germany, the Netherlands, United Kingdom, Japan, China, Sweden, Norway, Denmark, Finland, India, Canada, United States of America, Australia, Ireland, UNDP, ILO, etc Financial Institutions International and local financial institutions have been playing a vital role in the financing of development of the transport sector in particular transport infrastructure. Their roles range from capital support to financing technical assistance, to the provision of resources for infrastructure as well as operational improvement. The international institutions include the World Bank, Arab Bank for African Development (BADEA), OPEC, African Development Bank (ADB), Kuwait Fund and European Investment Bank. The local financial institutions include Tanzania Investment Bank (TIB), National Bank of Commerce (NBC), Cooperative for Rural Development Bank (CRDB), National Social Security Fund (NSSF), Parastatal Provident Fund (PPF), Local Authority Provident Fund (LAPF) and National Provident Fund (NPF) Training Institutions Training institutions under MID are playing a big role in capacity building of staff in the sector. Training institution under the Ministry including National Institute of Transport (NIT), Morogoro Works Training Institute (MWTI), Dar es salaam Maritime Institute (DMI), Civil Aviation Training School (CATS) Bandari College, Tabora Railway Training College, Kigoma Meteorological and Mbeya Appropriate Technology Training institute (ATTI) Private Sector Private sector is an engine of the sector for service provision. Among the private sector operators within the sector are Tanzania Bus Owners Association (TABOA), Tanzania Tank Operators Association (TATOA), Dar es Salaam Commuters Bus Association (DACUBOA), Tanzania Truck Operators Association (TAROTA), Dar-es-Salaam Taxi Drivers Association, and the Association of Private Air Operators. Others are the Association of Consulting Engineers Tanzania (ACET), Tanzania Civil Engineers Contractors Association (TACECA), Tanzania Roads Users Association (TARA), Tanzania Forum Group (TFG), Tanzania Farmers Association (TFA), the Tanzania Chamber of Commerce and Industry (TCCIA), etc. 24

42 CHAPTER TRANSPORT SECTOR PERFORMANCE REVIEW (2001/ /07) A s indicated earlier, the Government started reforming of the transport sector from early 1990 s. Prior to this, there was limited resources allocated which resulted in failure to improve the condition of the existing transport infrastructures and increased backlog of maintenance of especially the road, railway, maritime and airport networks. These impacted negatively to the overall performance of transportation in Tanzania and hence to the development of the national economy. The poor performance of the transport sector also led to failure by the nation to attain some of the poverty reduction strategies. In the past 5 years, the transport sector has contributed towards poverty reduction directly by providing off-farm employment opportunities to the poor in rural and urban areas and indirectly by playing a complimentary role in stimulating production activities and improvement in the social services. The sector has facilitated to integrate market-strengthening competition, increase access to farming techniques, promoting trade, tourism, foreign investment and has contributed to increased government revenue. This chapter outlines the performance of the sector in the last five years. 6.1 Roads During the period of 2001/ /06, the Government was implementing the First Phase of the Ten- Year Road Sector Development Programme (10-YRSDP). The emphasis was on providing a safe and efficient road network for the trunk and regional roads so as to support the social economic development, and to provide effective linkage with the district, feeder and urban roads. The implementation of the programme was also addressing the following weaknesses experienced in implementing Integrated Roads Project (IRP) and the Urgent Roads Rehabilitation Programme (URRP): Low institutional capacity in implementing and managing road projects resulted into delays in project completion, low quality work and cost overrun. Lengthy procurement procedures led to late start of the projects and change of the scope of the work resulting to further deterioration of the roads sections after design. Untimely release of funds for project implementation, which have led to cost overrun and postponement of some projects. Low capacity of local contractors and consultants has become a hindrance to implementation of the projects. In some parts of the country, regional roads rehabilitation projects could not be implemented due to lack of contractors. Delay in commencement of the 10-YRSDP due to late introduction and preparation of the programme. The Consultant also delayed in submission of the final report (2002). Inadequate financing Status of Physical Road Development Works Trunk & regional Roads The 10-YRSDP was planned to be implemented in two phases of five years each namely, First five years period from 2001/02 to 2005/06 and the second five years period from 2006/07 to 2010/11. The status of implementation of trunk and regional road projects is given below and is detailed in Table

43 Table 6.1: A list of constructed / rehabilitated trunk and regional road projects and bridges in the period 2001/02 to 2006/07 SN Name of Corridor me of Road Length (km) Financier Cost USD 000s 1 North Eastern Wazo Hill Bagamoyo 43 ITALY 14,600 2 Lake Circuit Kagoma - Muhutwe 24 OPEC/GOT 5,200 3 Lake Circuit Muhutwe Mutukula 112 ADB/GOT 17,311 4 Lake Circuit Mwanza Town and Mwanza 58 EU 19,000 Nyanguge 5 TANZAM Chalinze Morogoro Melela 129 DANIDA 37,000 6 Great North Makuyuni - Ngorongoro Gate 77 JICA 23,000 7 TANZAM TANZAM (Kitonga Gorge) 7.64 JICA 7,150 8 Southern Coastal DSM - Mkuranga 60 GOT/KUWAIT 9,120 9 Southern Coastal Mkuranga Kibiti 60 KUWAIT/OPEC/ GOT 9, Lake Circuit Kyabakari - Butiama 12 GOT 2, Southern Coastal Somanga 33 GOT 13,30000 Masaninga/Matandu 12 TANZAM Bridges along TANZAM GOT/IDA 2, Western Bridges along Tunduma Sumbawanga GOT/IDA 4, North Eastern Bridges along Tanga GOT/IDA 6,746 Horohoro 15 Southern Costal Rufiji bridge and its KUWAIT/OPEC/ 29,300 approaches SAUD 16. TANZAM Songwe Tunduma 71 NORAD 11, Central Morogoro Dodoma 267 EU 40, Central Shelui Nzega 112 ADB/GOT 19, Central Nzega Tinde Isaka and 73 EU 26,637 Tinde Shinyanga Ilula 96 EU 32, Lake Circuit El-Nino Repairs Lot ADB/GOT 1, Mid west El-Nino Repairs Lot ADB/GOT 1, Southern El-Nino Repairs Lot ADB/GOT 1, Western El-Nino Repairs Lot ADB/GOT 1, Lake/Central/Mid west 26 TANZAM/Southern 27 Rehabilitation of Regional 911 ADB/GOT 23,811 Roads in Kagera, Dodoma, Singida and Tabora regions RUSIRM Iringa Routine Maintenance 674 EU/GOT 2,713 Backlog Maintenance EU/GOT 3,866 RUSIRM - Ruvuma Routine Maintenance 1275 EU/GOT 12,143 Backlog Maintenance 498 EU/GOT 8, RSPS Phase 2 Iringa & Coast 400 DANIDA Total 6, ,709,192 Source: Ministry of Infrastructure Development, 2007 During the first phase of the 10-YRSDP, it was planned to rehabilitate and upgrade 2,158.7 km of trunk roads and 3,505 km of regional roads. The physical performance for the first five years was rehabilitation and upgrading 1,168 km of trunk roads and 4,184.9 km of regional roads which is 54.3% and 119% of the targets respectively. Contribution during the five year period from the Development Partners and the Government was USD million equivalent to 63.7% and USD million equivalent to 36.3% respectively. 26

44 In the period 2000 to 2005, Kilombero ferry (Morogoro), Ukara ferry (Mwanza) and Kilambo ferry in Rukwa were bought at a total cost of TShs billion and two rescue boats at Kigamboni in Dar es Salaam and Mwanza were bought at a cost of TShs 500 million. During this period Ilagala ferry in Kigoma, Ruhuhu ferry in Ruvuma, Pangani ferry in Tanga, Kyanyabasa ferry in Kagera and Sengerema ferry in Mwanza were rehabilitated at a total cost of TShs 104 million. The projects whose procurement or implementation started in the first 5 years of the 10-YRSDP will spill over to the First Phase of TSIP. The projects are summarized in Table Local government Roads During the period of 2001/ /06 approximately TShs 5,500 million from the Roads Fund was used for development works on district, feeder and urban roads. The funds were used for 60 projects on spot improvement, rehabilitation and upgrading of roads and construction of bridges. Under the Support to Decentralization Programme (SDP) in Mwanza Region from 1998 to 2004, approximately USD 3 million was disbursed for rehabilitation of 315 km of district and feeder roads using Labour Based Technology (LBT). The programme has been supported by UNDP/UNCDF and Norway. The programme trained 9 contractors and 6 consultants in LBT. In early 2006, an additional amount of USD 1.0 million was disbursed by PMO-RALG using funds from Norway under the Local Government Transport Programme (LGTP) for rehabilitation of 61 km of roads. These road works, which were completed by the end of 2006, enabled the contractors to complete down payment of bank loans for procurement of equipment. The programme was phased out at the end of Denmark has provided support to local government roads under the Local Roads Component of the Road Sector Programme Support (RSPS) since the start of Phase 1 in Assistance has been provided for spot improvements and rehabilitation of district and feeder roads in Rufiji and Kisarawe districts in Coast Region and Mufindi and Iringa Rural districts in Iringa Region. The programme also supports implementation of the Village Travel and Transport Programme in some of these districts as well as training of small scale contractors in LBT. The support for Iringa Rural, Kilolo and Mufindi districts will continue in Phase 3 which started in 2005/06 and will be expanded nation-wide under the LGTP. During the RSPS - Phase 2, a new component of institutional support to PMO-RALG Headquarters commenced with a technical adviser supporting road fund management and VTTP. This support will continue in Phase 3 including support to the LGTP. Currently there are also road works being implemented on district, feeder, urban and community roads funded by the Councils own revenue, Tanzania Social Action Fund (TASAF) supported by WB, Agricultural Marketing Systems Development Programme (AMSDP) supported by IFAD and ADB, Agriculture Sector Development Programme (ASDP) supported by several development partners and to some extent Local Capital Development Grant supported by WB and some other development partners. 27

45 Table 6.2: A list of ongoing trunk roads projects which will be taken on board the TSIP SN Name of Corridor me of Road/Bridge Length (km) Financier Under Rehabilitation/Construction 1 TANZAM Msimba-Ruaha Mbuyuni-Kitonga & 219 DANIDA Ikokoto-Mafinga 2 TANZAM Ruvu bridge 104 (m) GOT 3 North Eastern Tarakea-Kamwanga-Rongai 32 GOT 4 North Eastern Marangu-Mkuu Rombo 34 NORAD 5 North Eastern Tarakea-Mkuu Rombo 32 BADEA/GOT 6 South Coastal Nangurukulu-Mbwemkulu-Mingoyo 160 GOT 7 Lake Kagoma-Lusahunga 154 ADB/GOT 8 Lake Geita-Chato-Kyamyorwa 220 GOT 9 Central Dodoma-Singida 246 GOT 10 Central Singida-Shelui 110 IDA/GOT 11 Dar Roads Mandela road 32 EU 12 Dar Roads Kilwa road 23.2 JICA 13 Dar Roads Sam Nujoma 8 GOT 14 Mid West Mbeya Makongorosi 115 GOT 15 Road Sector Programme (RSP) NORAD/GOT Regional Roads 16 STABEX (8 coffee growing regions 350 EU/GOT (Regional Roads) 17 STABEX District Roads 205 EU/GOT Under Procurement of the Contractor 18 North Eastern Korogwe-Mkumbara-Same 165 IDA 19 North Eastern Chalinze-Segera-Tanga 245 DANIDA 20 South Coastal Ndundu-Somanga 60 KUWAIT/OPEC/GOT 21 Great North Road Arusha-Namanga 106 ADB/GOT Detailed Engineering Design Completed 22 Great North Road Singida Babati Minjingu 223 NDF 23 Great North Road Dodoma Babati 263 NDF 24 Lake Bwanga-Biharamulo 100 GOT 25 Lake Bwanga Uyovu 120 GOT 26 Lake Makutano-Fort Ikoma 100 GOT 27 Mid West Tabora-Kaliua-Uvinza 120 GOT Detailed engineering design on going 28 Western Corridor Sumbawanga-Mpanda 240 GOT Feasibility study and Detailed Engineering Design ongoing 29 Lake Isaka-Bukombe- Lusahunga EU 30 Lake Nyanguge-Musoma EU 31 Western Corridor Kigoma-Kasulu-Nyakanazi 100 GOT Source: MOID Total 4,371.3 Quite a number of area-based programmes, including rehabilitation of district and feeder roads, have been completed over the last 5 years. These include, among others, programmes supported by SDC, SNV, SIDA, WB, USAID, Irish Aid, Finnida and Plan International. 28

46 The VTTP include development of community roads/paths/tracks/footbridges, intermediate means of transport (IMTs), non transport interventions (NTI) and improvement of landing points, etc. Activities have been implemented in 7 Pilot Districts since early 1990s. Over the last ten years, activities have been implemented in Mbozi and Muheza districts funded by Norway, Iringa and Rufiji districts funded by Denmark, Morogoro Rural funded by Switzerland, Iramba funded by World Bank, and Masasi funded by Finland. The VTTP will be replicated nation wide under the LGTP. The Government launched the National Rural Transport Programme (NRTP) in 2005/06, now renamed the Local Government Transport Programme (LGTP), to emphasize that it will also deal with urban roads. The Government has so far attracted support to the programme from Norway and Denmark over a five year period ending in 2010 and 2011 respectively. The Programme is part of the TSIP. A new Programme Document for the implementation phase of the LGTP is expected to be adopted by the Government by the end of Review of Maintenance Works for the first five year of 10YRSDP (2001/02 to 2005/06) Road fund disbursements The Roads Fund level increased by 114% from Tshs billion in 2000/01 to Tshs billion in 2006/07. The Government commitment to ensure improved level of maintenance of its road asset is depicted in the trend of road fund allocation summarized in Table 6.3. Due to increased flow of funds and the major programme of road rehabilitation, the proportion of the road network in good condition has improved tremendously from 14% in 2002/03 to 40% in December 2006 for trunk and regional roads. The corresponding figures for roads in poor condition were 49% in 2002 to 22% in December The road condition was based on visual assessment. Table 6.4 depicts the trend of improvement of road condition for trunk and regional roads Trunk and Regional Roads Maintenance works carried out annually on the road network during the last six year period included regular maintenance and backlog maintenance. The regular maintenance was funded by Roads Fund and it included routine and recurrent, periodic, spot improvement, bridge and emergency maintenance activities. The backlog maintenance was funded by Development Partners through various development programmes and is therefore reviewed under the section for development works. The maintenance funding from Roads Fund which was allocated for trunk and regional roads maintenance amounted to Tshs 259,093 million over the period and the corresponding annual allocations are as shown in Table

47 Table 6.3: Actual Roads Fund disbursements 2001/ /06 and Budget 2006/07 (TShs. Billion) Actual Actual Actual Actual Actual Budget Agent 2001/ / / / / /07 Total MoW / MID TANROADS PMO-RALG RFB Total Source: Roads Fund Board, December 2006 Table 6.4: Trend of Trunk and Regional Roads Condition Year Good Fair Poor Total (km) (%) (km) (%) (km) (%) (km) (%) , , , , , , , , , , , , , , , , , , , , Source: TANROADS (December 2006) The regular maintenance financed through Roads Fund on average covered the following physical achievement: (i) (ii) Routine maintenance was carried out on average of 17,088 km annually; periodic maintenance and spot improvement covered on average 1,119 km annually; and bridge maintenance was provided to an average of 2,397 numbers of bridges annually. The maintenance works carried out over the period were largely executed by private sector (average of 93% of the value of works) and to a lesser extent by the Force Account method (7%). Community groups (women & youth) were used as contractors in some selected works so as to support National Policies of poverty reduction. On other hand the financial expenditure on maintenance works was on average 75% of the allocated budget over the period and ranged from 73% in 200/01 to 81% in 2006/07. The remaining funds at the end of each financial year were utilized in the subsequent financial year to complete ongoing committed works. Vehicle axle load control operations were carried out using mobile and permanent weighbridges along all trunk roads corridors. As a result, there has been an overall reduction in vehicle overloading with percentage of overloaded vehicles falling from 18% in 2000/01 to less than 7% in 2006/07. During the period 2001/ /07, Road Maintenance Management System (RMMS) and Bridge Maintenance Management System (BMMS) were further upgraded to add more features for planning and monitoring purpose. The systems are operational and currently are being upgraded to incorporate latest features like GIS modules. Both systems act as data banks with RMMS storing data like traffic, condition and road inventory, and BMMS storing data on bridge condition and inspection. Also the systems have analysis modules which assist in the development of the annual maintenance programme. Data from RMMS can be exported into HDM4 for multi-year analysis (programme and strategic analysis).the first comprehensive inventory for trunk and regional roads were completed in December Also all roads data like condition, traffic and bridge condition and inspection data were collected periodically. 30

48 Local Government Roads The maintenance of local roads over the last six years has been guided by: (i) The adopted strategy to carry out full routine maintenance of all roads and cross drainage structures in good and fair condition, (ii) Periodic maintenance of roads in transient from fair to poor condition, (iii) Spot maintenance of roads in poor and bad condition and re-installing bridges, drifts and culverts which have been washed away by rains, damaged by traffic or worn out due to age. The maintenance funding, including 10% for development works, is shown in Table 6.3 above. The increased maintenance funding together with development works has made it possible to increase the network being maintained and the proportion of roads in good and fair condition has increased from 50% in 2003/04 to 55.2 % in 2005/06, However, the funding level in 2005/06 was still only 28% of the estimated needs which cannot sustain the condition of the network. The 150% increase of maintenance funding in 2007/08 is therefore a very important development that can improve the condition of local roads and sustain new investments. Starting in 2002, PMO-RALG has developed a District Roads Management System (DROMAS). DROMAS has so far been rolled-out to 56 councils and the remaining councils will be trained by the end of 2007/08. The DROMAS will make it easier for the councils to keep updated records of inventory and condition data, prepare annual work plans for maintenance and rehabilitation works, manage works contracts and prepare reports to PMO-RALG and the Roads Fund Board. There has been a lot of uncertainty with respect to the size and condition of the road network under the Local Government Authorities. Thus, PMO-RALG with funds from the World Bank commissioned a Local Government Road Inventory and Condition Survey (LG-RICS) to establish the inventory and condition of district, feeder and urban roads. The study started in August 2005 and the survey was completed in November The first draft report was made available in December 2006 and the final report is expected to be out by November Inventory and condition data will be updated annually by the councils as part of DROMAS, i.e. Annual District Roads Inventory and Condition Survey (ADRICS) Major Achievements during the Period 2001/ /07 Major achievements in the road sub-sector during the period 2001/ /07 are: Proportion of trunk and regional roads in poor condition decreased from 49% in 2000 to 22% in December Proportion of local roads in poor and bad condition decreased from about 75% in 2003 to 44.5% in 2005/06. The capacity of Local Government Authorities to manage road works has improved due to increased deployment of staff. Number of civil engineers in councils substantially increased to 168. Quality of supervision of road works on LGA roads has improved. Capacity of supervising transport for council engineers has improved. Sharing of knowledge between council engineers has improved. Training of small-scale contractors in labour based technology (LBT) through area-based programmes funded by development partners. Regional Secretariat (RS) Engineers now in place in all regions. Construction Industry steadily developed as the private sector become more involved in execution of maintenance works. Out sourcing increased from 92% in 2000 to 98% in More than 7,000 road maintenance contracts for trunk and regional roads were awarded between 2000/01 and 2006/07. Most of these were awarded to local firms and hence contributed toward poverty reduction. 31

49 Contractors and Consultants skills continued to develop through organized training and jobs offered (on-job training/learning). Overloading on trunk roads was reduced from 18% in 2000/01 to fewer than 5% in 2006/07 for all vehicles weighed. There was noticeable improvement in reduction of travel time, increased access to rural communities, saving in vehicle operating costs and savings in vehicle maintenance costs Challenges, Shortfalls and Weaknesses During the first 5 years of implementation of the 10-YRSDP, the achievement of the planned length of road improvement was 54.3%. The challenges and reasons for shortfalls in achieving targets of the 10-YRSDP in the first five years were as follows: Inadequate financing, particularly for road maintenance. Inadequacy of plant and equipment for road works in the country. Local Construction Industry Capacity, which is limited in managerial skills and financial capacity. Also poor in equipment management skills and tendering skills. Institutional capacity of the implementing agency with inadequate contracts management skills among supervising staff and deficiencies in supervision facilities. Delay in commencement of the programme due to late introduction and preparation of the programme. The Consultant also delayed in submission of the final report (2002). Delay due to cumbersome procurement procedures in the initial years. Measures to address these challenges included providing the necessary training to staff in the agencies and to the local construction firms. Regarding plant and equipment, the existing plant pools were strengthened and private sector was encouraged to either invest in plant hire companies or to buy equipments for their use. The revised Public Procurement Act No. 21 of 2004 has empowered Ministries and its Institutions to award contracts of any magnitude. This change has shortened the procurement process. For the local roads, some of the major shortcomings are: (i) Inadequate funding of development works, (ii) Inadequate network management and maintenance planning, (iii) Limited technical capacity at district level, both staff and facilities, causing delayed implementation of works and underutilization of funds, (iv) Implementation of works not being part of approved work plans, (v) Maintenance funds being used for rehabilitation works, (vi) Poor contract administration and documentation, (vii) Insufficient supervision and quality control of road works, (viii) Lack of manuals and standard documents, (ix) Insufficient capacity of well qualified locally based contractors and equipment, in particular those specializing in labour based technology and difficulties of monitoring an extensive network of small roads. 6.2 Railways Reli Asset Holding Company (RAHCO) The RAHCO railway has an infrastructure design capacity of carrying 5 million tonnes of freight per annum. However, due to various reasons the design capacity utilization is about 25%. The government through the Reli Asset Holding Company has been burdened with deferred maintenance on the permanent way. In the case of locomotives and rolling stock, the burden of deferred maintenance falls under the responsibilities of the Tanzania Railways limited (TRL). No efforts have been undertaken to modernize the infrastructure. As a result the network is old and outdated leading to low operational efficiency. For example, travel time between Dar es Salaam and Kigoma is three days 32

50 which could be reduced to one and half days with modernization. The narrow gauge is a major contributor to speed limitation and is very prone to accidents. On the other hand, spare parts are not readily available since they are outdated. In an effort to solve this problem the World Bank has committed to assist the government on infrastructure development, RAHCO s capital structure has been improved by the government through a debt swap mechanism; totaling TShs. 80 billion and, recently, the government provided about USD 2.3 million to overhaul 11 mainline locomotives and rehabilitate 70 wagons. However, RAHCO needs more comprehensive investment package to keep it back on the rails again. As indicated in Table 6.5 and 6.6, in the period 2000/01 to 2005/06 the following RAHCO capital development and maintenance projects were implemented: But even when the above interventions have been undertaken the move will enable RAHCO to get modernized in any way. A study will have to be undertaken to determine what exactly needs to be done to make RAHCO modern at least in the long term. TRC has had the advantage of long average hauls of over 1,000 km largely contributed to by the wide geographical spread of production centres and transit trade to/from the landlocked countries of Democratic Republic of Congo, Burundi, Rwanda and Uganda. Transit freight has at times been as high as 38% of the total whereas freight revenue has been over 85%, of the total revenue, the rest obtaining from passenger traffic. Operational efficiency of TRL performance (Table 6.7) has been constrained mainly by infrastructural problems. There is also growing competition from road and the North Corridor from Mombasa Kampala. The stiff competition from road transport has made TRL to discontinue its passenger services between Dar es Salaam and Moshi. Poor rolling stock, i.e. locomotives and wagons, have also contributed to the low operational performance of TRL. This is vividly indicated in the fact that the number of transported passengers by TRC decreased from 728,000 in 2001 to 628,000 in Freight by TRL dropped from 1.35 million tonnes in 2001 to million in The status of RAHCO infrastructure and operating equipment is worsening; the freight performance reached the highest level ever in 2002/3 since 1977 and now declining. This trend can only be reversed to reach the desired financially viable level of about 2 million tonnes with heavy investment in infrastructure and operating equipment. M/s RITES, the concession Operator of TRL will lease and rehabilitate existing locomotives, wagons and coaches from RAHCO as well as purchase and/or dry lease additional ones. Table 6.5: TRC major development projects 2001/ /06 Project Title Financier Year Commenced Year Completed Project Cost (Tshs. Million) Supply and installation of 240 turnouts KFW Permanent Structures (Kilosa-Kidete section) IDA ,300 Rehabilitation of 100 wagons TRC Rehabilitation of 10 coaches KFW CTCP:Environmental Impact Assessment Plan Study IDA CTCP:Resetllement Plan IDA CTCP: Change Manager (Restructuring Advisor) IDA Ilala Container Equipment Belgium Shinyanga Container equipment Belgium Mwanza Container Equipment Belgium Telecom Network Phase III (Dodoma-Tabora Section) Source: TRC Netherlands ,247 Total 33,342 33

51 Table 6.6: TRC maintenance projects 2001/ /06 Cost in TShs millions Type of Maintenance Permanent Way 9, , , , Signals and Telecoms 1, , , , Locos and rolling stock 4, , , , , TOTAL 15, , , , , Source: TRC Table 6.7: TRC Operational Performance Indicators Broken rails (occurrences ) Main Line Locomotive availability (Nr) Main Line Locomotive Reliability (km/per failure) ,359 5,400 4,107 2,720 2,379 1,985 Freight Performance (tonnes) 1,350,625 1,445,757 1,442,713 1,333,249 1,128, ,000 Transit Freight (tones) 524, , , , , ,510 Passengers (Nr) 728, , , , , ,089 Average Speed (Kph) Pax Train Average Speed (Kph) Train Source: TRC Freight Tanzania Zambia Railway Authority TAZARA is a 1,860 km line constructed in the 1970s. Its infrastructure is in a reasonably good condition but is facing serious operational and financial constrains. The railway has a design capacity of carrying 5.0 million tonnes of freight per annum, i.e. 2.5 million tonnes in each direction, and 3.0 million passengers per annum. As indicated in Table 6.8, in the period 2000/01 to 2005/06 TAZARA implemented several capital development and maintenance projects. TAZARA Own Resources were used for maintenance as shown in Table 6.9. Table 6.8: Capital Development Programmes Implemented by TAZARA from 2000/ /06 (USD) Particular 2001/ / / / /06 Total TAZARA Own Resources 3,000,000 3,000,000 3,000,000 3,000,000 3,000,000 15,000,000 GoT Nil Nil Nil Nil 100, ,000 Other (China and Austria) 34,000, ,000,000 3,000,000 Nil 40,000,000 Total 37,000,000 3,000,000 6,000,000 6,000,000 3,100,000 55,100,000 Source: TAZARA Table 6.9: Maintenance costs of TAZARA from 2001/ /05 (USD million) 2000/ / / / / Source: TAZARA The performance of TAZARA in goods and passengers transport in the period is shown in Table Whilst the performance trend for traffic has shown a fluctuating trend between domestic and international traffic, the performance trend for the passenger traffic has remained quite stable

52 Like in the case of RAHCO, priority for TAZARA will be on maintenance, rehabilitation/replacement of equipment, strengthening of the permanent way and modernization. Table 6.10: Goods and passengers transported by TAZARA from Year Locomotives Passenger Wagons Goods Wagons Domestic Passengers International Passengers Domestic Goods (tonnes) International Goods (tonnes) ,523,452 19, , , ,510,180 30, , , ,047,620 21, , , ,000,956 20, , , ,000,950 20, , ,110 Source: MCT Budget Speech 2005/ Weaknesses and Shortfalls of Railways Sub-Sector Railway system has faced the following weaknesses and shortfalls: Operational efficiency of TRC performance has been constrained mainly by infrastructural problems. Competition from other regional corridors such as Maputo Corridor and the Northern Corridor from Mombasa to Kampala, Kigali and Goma. Competition from corridors through Mozambique especially after restoration of peace in most states in Southern Africa; and also the improvement of transportation facilities of other modes. Poor performance of the economy of neighboring landlocked countries. Change in traffic patterns. Infrastructure and rolling stock weaknesses on the part of TRC and TAZARA Strategic targets set for the Railways Keeping railway infrastructure in public ownership or oversight but at the same time bringing in public/private sector partnerships wherever possible. Mobilizing financial resources through the Government and also through government/private sector partnerships while at the same time seeking for the support of development partners. Speeding up the reform process for TAZARA which includes the concessioning of operations to enhance performance efficiency. Enhancing regulation to ensure fair play between modes. Reviewing the institutional framework arrangements to enable TAZARA make decision and operate on a business manner. Undertaking railway master-plan study to determine level of modernization and infrastructure required, additional network needs and funding modalities. 6.3 Maritime Transport Coastal Ports The Tanzania Ports Authority in between 2002 and 2006 implemented a number of development projects which were designed to modernize the ports by providing additional cargo handling equipment, improve and upgrade infrastructural facilities. A total of TShs.101,976 million was invested over the past five years (Table 6.11). Table 6:11: Capital Investment Budgets 2002/ /07 [TShs. Million] Year 2002/ / / / /07 Total Capital Investment 8,460 12,931 21,267 18,408 40, ,976 35

53 Major projects implemented during the period include the dredging of the Dar es Salaam port entrance channel and modeling of the West Ferry Terminal, improvements to Kurasini Oil Jetty and procurement of various equipment (including marine crafts, pilot boats and passenger landing pontoon). The impact of these projects has been reflected in the improved port services, the major of which has been the improved turn round of ships including the twenty four hours navigation along the Entrance Channel, reduced ship stay at port and reduced berth occupancy levels at Dar es Salaam Port. During 2006/2007, TPA set aside T.shs.40,910 million for the Capital Development Programme. Major civil works projects under implementation include the following: Construction of New Port Control Tower - Dar es Salaam. Rehabilitation of sinking sheds floors - Dar es Salaam. Repairs to Container Terminal Piles - Dar es Salaam. Rehabilitation of lighter quay No. 1 Tanga. Heavy duty paving Mtwara for Container Traffic. Replacement 18 Crude Oil Submarine Pipeline at KOJ Acquisition Marine and Cargo Handling Equipment TPA Maintenance costs (2001/ /07) The TPA maintenance costs has mainly been on repair of equipment and minor works in the areas of infrastructure repairs such as rails tracks, roads within the port area, repairs to the sheds and pavements and maintenance to the floating crafts. The maintenance cost is shown in Table Table 6.12: Maintenance costs of TPA from 2001/ /07 (TShs. million) Year 2000/ / / / / / /07 Maintenance Costs 2,721 3,534 4,773 4,803 3,914 7,750 9,314 Source: TPA The total cargo traffic handled by major coastal ports over the past six years has increased from 4,684,929 tons in 2001 to 7,291,106 tons in 2006, an average of about 6.0 million tonnes annually with a growth rate of 6.7%. The larger portion of this traffic has been containerized cargo which has been increasing at an average rate of 19.5 % per annum from year Table 6.13 shows the trend. The Port of Dar es Salaam has the largest share in cargo traffic, with 6,657,496 tons in About 20 percent of the total traffic through the Port of Dar es Salaam is transit cargo (Table 6.14) Table 6.13 Total cargo traffic handled by major coastal ports PORT/YEAR (DWT)2006 Dar es Salaam Port Imports 3,512,177 3,630,716 4,041,779 4,763,537 4,829,009 5,225,448 Exports 665, , , ,925 1,051,184 1,003,974 Transshipment & Bunkers 93, , , , , ,074 Sub Total 4,271,574 4,524,509 5,168,964 6,054,019 6,285,060 6,657,496 Tanga Port Imports 100, , , , , ,896 Exports 130, , , , , ,790 Sub Total 231, , , , , ,686 36

54 PORT/YEAR (DWT)2006 Mtwara Port Imports 71,318 78,734 69,957 65,761 55,290 62,598 Exports 110, ,727 71,377 89,142 54,907 92,326 Sub Total 181, , , , , ,924 Grand Total 4,684,929 4,972,426 5,646,916 6,548,345 6,794,773 7,291,106 Source: TPA Transit traffic to and from Uganda and Burundi is also carried by vessels of the Marine Service Company through Mwanza Port on Lake Victoria. Table 6.15 shows that the trade with Uganda has increased substantially from about 230,000 tons in 2000 to about 310,000 tons in 2004, while at the same time trade with Burundi decreased from almost 200,000 tons in 2001 to 100,000 tons in Table 6.16 shows that, there has been an increase from 565,704 passengers in 2001 to 756,259 passengers embarked and disembarked in 2004 at the major sea ports. Table 6.14 Transit traffic through Dar es Salaam Port (in tons) Country Zambia 440, , , , , ,353 D.R. Congo 101, , , , , ,131 Burundi 89,122 64,852 72,902 92, ,928 95,892 Rwanda 70,978 48,284 50,661 63,392 83,506 77,918 Malawi 5,661 66,534 28,963 24,559 28,530 77,357 Uganda 111,860 40,432 69, ,811 83,592 46,855 Others 93, ,407 78, , , ,757 Total 915, ,805 1,006,896 1,360,814 1,382,106 1,531,269 Source: TPA Table 6.15: Transit cargo through Mwanza Port by MSCL vessels 2000/04 (in tons) Country Uganda Imports 182, , , , , , ,777 Exports 49,208 52,500 75,733 43,251 65,862 68,928 43,100 Burundi Imports 140, , , ,513 86, , ,600 Exports 30,933 26,416 17,457 24,499 13,884 13,262 18,276 Source: MSCL Table 6.16: Number of Passengers through Coastal Ports PORT Dar es Salaam 528, , , , , ,338 Tanga 875 1,675 2,792 3,500 36,353 8,968 Mtwara 36,408 62,499 32,778 40,235 11,782 8,968 TOTAL 565, , , , , ,134 Source: MCT Budget Speech, 2005/ Containerization Following ongoing institutional reforms in the transport sector, in 1998 the operations of Dar es Salaam Container terminal was leased to a private operator called Tanzania International Container Terminal Services (TICTS). 37

55 The Dar es Salaam Container terminal is rated to handle 250,000 TEUs per annum. During the last 3 years container throughput has been increasing at an average rate of 19.5% per annum compared to earlier projections of between 5-10%. During the year 2006, the container terminal handled 255,880 TEUs which is higher than the terminal rated capacity of 250,000 TEUs. The upsurge in throughput is due to increase in transshipment cargo. The average growth rate of import containers was 15.5% and that of export containers was 11.9% per annum as summarized in Table Table 6.17: TICTS Containerized Cargo TEUs Particular Imports 76,042 82,703 98, , , ,269 Exports 16,369 35,886 44,374 65,544 68,053 66,289 Transshipment 6,280 24,818 36,638 55,580 59,322 59,322 Total 98, , , , , ,880 Source: TPA Container Terminal Inland Waterways There has been a stiff competition for freight between the private operators and the MSCL following an increase in private sector participation in maritime service provision. However, MSCL has managed to increase the freight it carries on Lake Victoria as indicated in Table There was remarkable performance improvement over the past five years / /06. Freight has increased from 56,924 tons handled in 2002/03 to 87,889 tons in 2005/06. Freight at Mwanza Pier increased from 11,164 tons to 38,260 tons. However cargo transport by MSCL through Kigoma decreased from 16,115 tons in 2001/02 to 1,897 tons in 2005/06. Table 6.18: MSCL Freight Performance (tonnes) PORT 2001/ / / / /06 Bukoba Pier 3,900 9,017 6,789 11,770 13,750 Mwanza Pier 11,164 15,817 15,752 33,487 38,260 Mwanza South Pier 20,495 21,680 22,530 22,530 23,695 Kemondo Bay 10,589 5,200 4,090 19,020 10,287 Kigoma 16,115 5,210 15,875 1,769 1,897 TOTAL 62,263 56,924 65,036 88,576 87,889 Source: MSCL There has been a varying trend of passenger traffic over the past five years due to several factors but the most important is the weather situation in the year. When agricultural production is low due to poor weather conditions, fewer passengers are recorded because fewer trips are made to the markets. Table 6.19 indicates the trends of passengers in the last five years that was carried by MSCL. Table 6.19: Number of Passengers Handled by MSCL PORT 2001/ / / / /06 Mwanza 106, , , , ,625 Bukoba 68,991 67,788 80,106 81,878 86,780 Kigoma 13,182 39,594 15,514 10,040 16,230 Itungi Port 6,608 11,983 8,180 6,293 7,320 Kemondo Bay 8,777 8,781 9,378 8,433 9,420 Mbamba Bay 2,520 3,500 1, ,230 Nansio 68,450 58,316 35, , ,320 TOTAL 274, , , , ,925 Source: MSC There was a huge increase in the passenger traffic in the year 2004/05. This was due to favourable weather condition that resulted to higher agricultural production. 38

56 Modernized water way transport is expected to attract private sector to lease the waterway facilities or operations. The improvement of railways, roads, ports is expected to contribute to the increase of passengers through the ports. In order to cope with improvements of other modes of transport, during the first phase of TSIP projects related to the improvement of facilities are going to be implemented to make the best use of the inland water ports and also to make the inland water resource more accessible mode of transport especially for the people around these lakes Achievements i) Efficiency in container handling has increased from less than 6 containers per hour in 1998 to above 15 containers per hour after concessioning of container terminal handling. ii) Established Tanzania Port Authority which is a land lord of coastal and inland waterways ports. iii) Ships of all size (with exception of Panamax ships) can now enter to the Dar es Salaam port for 24 hours a day since dredging of the port was executed in Previously ships were entering the Dar es Salaam port in day time only Weaknesses and shortfalls The following factors contributed in low performance in the marine transport sub sector: (i) Increased competition for transit cargo arising from availability of alternative routes for landlocked countries. Almost 30% of total Dar es Salaam port throughput is transit cargo. (ii) Lack of bulk handling facilities for loading and discharging at Dar es Salaam port. The use of conveyor belts is more cost effective if the traffic levels justify for such investment. (iii) Increasing competition from the ports of Mombassa, Beira and Daburn. (iv) Inadequate capacity to handle increased container traffic at Dar es Salaam port (v) Poor infrastructure at inland ports particulary on link span, slipways and dredging at Mwanza North, Kemondo bay, Musoma and Kigoma port. (vi) Poor navigation due to lack survey and maps within the lakes. No aids to navigational exist. (vii) Drastically decreasing water levels at all ports has affected the port landing facilities especially at Nansio and Kigoma ports. (viii) Lack of adequate capacity of inland Transportation system e.g. rail, road and lake services. (ix) Inadequate container handling facilities and equipment at Mtwara port. (x) The lighterage operation at Tanga Port which involves double handling of cargo is costly. The need to address these weakness and short falls is the essence of the TSIP. 6.4 Air Transport The liberalization of aviation sector has brought on board competitive private sector operators. Room for more airlines is available to improve competition in the supply of air passenger services throughout the country. The domestic services also serve to satisfy business and tourism markets. International scheduled services are governed by Bilateral Air Agreements concluded between Tanzania and other countries. The number of registered air operators in the country has been increasing year after year. The aviation industry has been steadily growing with an average growth rate of 9% annually. This growth rate is greater than the average 4% growth rate of the global aviation industry. International Scheduled Air Services in the country has been increasing as well. As of December 2004, there are 16 foreign airlines providing international scheduled services. The number of weekly frequencies by these airlines has been increasing thus increasing passenger traffic. As the economy grows flight frequencies will increase and necessity for better airport facilities will be desirable. 39

57 6.4.1 Investment and Operational Performance (2001/ /06) In the period 1999 to 2006 various airport capital development projects were implemented as shown in Table 6.20 while Table 6.21 gives the TAA infrastructure routine maintenance costs for 2001/ /05. In its short span of existence (seven years) as an executive agency, it has increased its revenue to TShs 23 billion in 2006/07 from TShs 4.34 billion in 1999/2000. TAA has also improved the infrastructure, services and conditions of airports in Tanzania to a great extent and has accelerated the process of rehabilitation of its airports. Table 6.20: Capital Development Programmes implemented by TAA and KADCO from S/N Project Name Funding 1 Julius Nyerere International Airport (JNIA) rehabilitation of apron, runway, Aeronautical Ground Lighting System, sewage system and storm water drainage system 2 Dar es Salaam International Airport (DIA) rehabilitation of power supply system Euro 22,000,000 Source Funding ORET/ING- Bank of Year completion 2006 Euro 4,800,000 ORET/EIB DIA and KIA supply of fire tenders USD 2,540,000 ORET/EIB Mwanza airport rehabilitation of Runway and Aeronautical Ground Lighting System 5 KIA rehabilitation of Runway and Aeronautical Ground Lighting System USD 7,000,000 EU 1999 USD 5,800,000 IDA Ongoing Projects Songwe Airport TShs 19,500,000,000 Ongoing Source: TAA Table 6.21: Routine Maintenance Costs of TAA from 2001/ /05 (TShs.) 2000/ / / / /05 1,841,597,265 2,209,304,705 2,432,729,706 2,414,573,067 2,130,205,435 Source: TAA Passenger Traffic According to sub-sector statistics, the overall international and domestic passenger handled steadily increased by 105% from 1,206,821 in 2000 to 2, 470,127 in Of the 2, 470,127 passengers in 2006, 1,249,419 passengers were from Julius Nyerere International Airport (JNIA-Dar es Salaam), which is about 51% of the over all total passengers handled countrywide as shown in Chart 6.1. Chart 6.1: Annual Passenger Traffic of Passenger Traffic 2000 to ,000,000 2,500,000 2,000,000 1,500,000 Overall TAA 1,000, ,000 TCAA - Yr 2000 Yr 2001 Yr 2002 Yr 2003 Yr 2004 Yr 2005 Yr 2006 Sourc e: TAA/ 40

58 Aircraft Movements 10 Year Transport Sector Investment Programme (TSIP) Phase I 2007/ /12 Number of aircraft movements increased by 42% from 112,821 movements in 2000 to 160,766 movements in The traffic during this period increased steadily as shown Chart 6.2. Chart 6.2: Aircraft Movements Aircraft Movements 2000 to , , , , ,000 80,000 Overall TAA 60,000 40,000 20,000 - Yr 2000 Yr 2001 Yr 2002 Yr 2003 Yr 2004 Yr 2005 Yr 2006 Source: TAA/TCAA Cargo Traffic The cargo tonnage decreased by about 13% from 39,459 tons in 2000 to 34,524 tons in 2006 due to among other factors, inadequate infrastructure and low export base. The decrease in cargo tonnage during this period is shown Chart 6.3. Chart 6.3: Cargo and Mails Tonnage Cargo and mails Tonnage ,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 - Overall TAA Source: TAA/TCAA Yr 2000 Yr 2001 Yr 2002 Yr 2003 Yr 2004 Yr 2005 Yr 2006 The reasons sighted being reduced export of fish fillets through Mwanza due to poor airport infrastructure and limited exports through Mwanza airport to attract direct flight from European markets. As the results most of the fish fillets from Mwanza are being transported by road to Nairobi and Mombasa for export Achievements/strengths Due to the sustained ongoing institutional reforms: (i) The Tanzania Airport Authority (TAA) and Tanzania Civil Aviation Authority (TCAA) were established which have increased efficiency in airport managements 41

59 (ii) Increased private sector participation in the scheduled market has been realized such that: In year 2002, the Government sold 49 percent (49%) of its shares to ATC to South African Airline (SAA). However, the 49% has reverted to the Government (now 100% Gov. owned shares) following the breaking of the contract between ATC and SAA. Precision Air is another major airline, but unlike ATCL, it is owned and managed by the private sector. There are also other private airlines that also provide scheduled services One airport (Kilimanjaro International Airport KIA) has been concessioned to KADCO and more airports will be brought under the private sector or under public private partnership Weaknesses / shortfalls of Air Transport The air transport sub sector has the following major challenges/weaknesses/shortfall: (i) Deficiencies in the provision of international air navigation services due to lack of adequate navigational aids for the guidance of aircraft over flying its airspace and also for those landing at some of the airports. (ii) Inadequate airport facilities. (iii) Low human resources capacity to adequately manage and operate the air transport industry. (iv) Inadequate airport planning and management skills. (v) The Civil Aviation Master Plan (CAMP) that is in place does not accommodate the changes in policy framework that have taken place nationally, regionally and internationally. (vi) Lack of knowledge of the emerging Economic Regulation concept, which is new in the field of air transport. (vii) Inadequate capacity in trained pilots and aircraft maintenance engineers. (viii) Lack of a management system that will link the civil aviation headquarters and its centres across the country that will ultimately be able to be integrated with the technical network and be used for both data and voice transmission, so the importance of an efficient management information system. (ix) Manual collection and distribution of aviation data, does not match with the changing technology. 6.5 Institutional and Capacity Building Measures In the Transport Sector, during the period 2001/ /06, the following achievements have been made on institutional support and capacity building: The former Ministry of Communications and Transport and the former Ministry of Works and their institutions under their jurisdiction continued to build skill of staff through training. The former MoW through ERB, NCC, CRB and AQSRB conducted several courses, seminars and workshops for local consultants and contractors. ERB through SEAP trained over 350 young engineers. A construction Assistance Fund (CAF) was established. Establishment of a Construction Industry Development Fund (CIDF) is being finalized. Training of small scale contractors in labour based technology through area-based programmes funded by development partners. Regional Secretariat (RS) Engineers now in place in all regions. Number of civil engineers in councils substantially increased to 168. Capacity of supervision transport for council engineers has improved. The Government s initiative to develop and implement the Local Government Transport Programme with the aim to improve rural and urban accessibility in the entire network of local government roads. As a result of the Central Tender Board being reformed to the Public Procurement Regulatory Authority through the Public Procurement Act No.21 of 2004, ministries and its 42

60 institutions/agencies tender boards have been empowered unlimited capacity to award contracts of goods, services and works. This change has shortened the procurement process. The Public Procurement Regulation Authority is now mainly responsible for: ensuring application of fair, competitive and transparent procurement, harmonize the procurement policies and monitor compliance of procuring entities. 6.6 Funds Allocation for the Past Five Years ( ) Over the past 5 years the government with the assistance of development partners has invested substantially in the transport sector particularly road sub sector. Railways, ports and airports authorities have continued using their internally generated funds for capital expenditures with minimum support from the government and donor community partly because most of their operations were earmarked for privatization. On the other hand, the development partners contribution account for about 50% of the annual budget allocations which has largely been directed to rehabilitation and upgrading of road sub sector with few funds directed to maintenance. The involvement of the private sector in the infrastructure ownership and development has been growing gradually. Generally, the financial support to transport infrastructure has been in three (3) categories. The first category is the Government funds which are obtained through budget support and domestic revenues. Second category is the contribution of implementing institutions raise from own revenues; and the Third category is comprised of foreign funds (including loans and grants). Table 6.21 indicates funds allocated to the transport sector between 2001/2 and 2005/6 (in TShs). Table 6.21: Financing for transport sector (in TShs million) Sub-sector 2001/ / / / /06 TOTAL MID Nil Nil Nil Trunk and Regional Roads 154, , , , , ,218,430.0 Local Roads * 15,240 19,302 19,146 21,804 20,432 95,924 Railways 44, , , , , ,903.3 Airports 1, , , , , ,696.4 Ports 14, , , , , ,453.0 GRAND TOTAL 230, , , , , ,580, Source MID *Road Fund only 6.7 Issues for further consideration The implementation of reforms in the transport sector is generally satisfactory. We are now witnessing the overall good performance in the transport sector such as container handling in ports, road development and maintenance. This is evidenced by good condition of roads network in most regions and efficiency in container handling at the port of Dar es Salaam. However, there is still a need for very close follow-up of some issues which need improvements and refinements particularly but not limited to:- More emphasis on establishing Basic Rural Access to the rural population in support of the MKUKUTA goals for poverty reduction and economic growth. Widening of internal revenue base in order to minimize development and maintenance financing gap. On road maintenance funding, the measures being considered to broaden the road fund base include introduction of Access fees and re-introduction of Heavy Vehicle License fees. In 2007/08, the Road Fund fuel levy has been increased from TSh. 100 to TSh.200 per liter as an initial measure to increase the Roads Fund level. Improving rural accessibility. 43

61 Reducing congestion and pollution and improving mobility in urban areas. Modernizing the railway system making the sub-sector competitive. Increasing participation of local consultants and contractors in design and implementation of development and maintenance works through appropriate training and packaging of works and by increasing the amount of contracts to be tendered by the local industry only. Addressing properly crosscutting issues including environment, road safety, HIV/AIDS, awareness campaign in transport sector activities, participation of women, youth, disabled and other disadvantaged groups in the implementation of development and maintenance works. Continue utilization and promotions of use of Labour Based Technology in road works Continue with relevant and suitable capacity building programmes. Increase involvement of the private sector in rendering transport services. Further institutional reforms to facilitate efficiency in the transport sector. Rapid increase in traffic congestion and pollution in major cities and towns. These issues will be appropriately addressed in the First Phase of the TSIP. 44

62 CHAPTER SCOPE OF THE TRANSPORT SECTOR INVESTMENT PROGRAMME (2007/ /17) 7.1 Need for TSIP O ne of the 4 th Phase Government goals is to ensure that there exist an adequate transport infrastructure and services, which are key factors in Tanzania s efforts to promote growth and reduce poverty, as described in the MKUKUTA - the National Strategy for Growth and Reduction of Poverty (June 2005). The MKUKUTA gives emphasis to increasing accessibility to economic and social services. This not only promotes economic growth, but also improves the physical links between people and services. This can lead to a direct improvement in well being of the people through better access to health, education and other economic services. In rural areas, the MKUKUTA emphasizes agricultural development, because agriculture remains the dominant sector in the economy. It accounts for over 48% of the Gross Domestic Product; 80% of employment, and 55% of total foreign exchange earnings of the country. However, the agricultural sector is characterized by low productivity. As the majority of poor people lives in the periphery areas of the country in the rural areas and is engaged in agriculture, unlocking the country s potential for rural development is seen as the key to making a substantial impact on poverty reduction. A lot of effort is being made to enable Tanzania to leap frog to medium level economy. It is planned that the economy should grow at 8% by 2008 and sustained at over 10% afterwards. The economic reforms of late 1980 s led to an up surge in production of almost all export products, such as cotton, sisal, coffee, cashew nuts, etc. However, some of these products could not reach markets due to dilapidated transport infrastructure. This situation is not to be allowed to repeat. National efforts are to raise the per capita income of USD 300 today to over USD 1,500 by This is possible given the abundance of unexploited natural resources, largely due to inadequate transport infrastructure. Sectors needing special transport attention as a prerequisite to support and sustain growth are: Agriculture, Mining, Tourism, Manufacturing, Export as well as Internal Trade, and Social Services such as Education and Health. About USD 13 2 billion is needed to maintain, on a sustainable basis, rehabilitate, upgrade the existing transport network, and to expand infrastructure networks to bring accessibility standards to the level of a middle income developing country. For this to be possible, the Government needs to invest at least 8.4% of GDP in the Transport sector annually. As Tanzania is serving other landlocked countries of the region, there is need to ensure that potential transit traffic is not diverted to alternative routes (due to lack of investment in infrastructure and services). Currently it has been observed that inadequate infrastructure and services in TAZARA and TRC/TRL has: (i) Caused diversion of traffic from them, and Made some traffic to be diverted from the port of Dar es Salaam to alternative ports in the neighbouring countries. In drawing up the Transport Sector Investment Programme, the main goal is to ensure that the transport sector facilitate other socio economic sectors to attain their aspirations and hence lead to development and poverty reduction. The factors that have been considered in drawing up the programme are: 2 Estimates from the on-going Africa Infrastructure country Diagnostic Transport: Roads, railways, Ports, airports, Urban Transport by Vivien Foster and Robi Carruthers, World Bank 45

63 (i) (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) (x) (xi) (xii) (xiii) (xiv) Giving first priority to fully funding projects related to maintenance. All infrastructure that has been rehabilitated or upgraded and is therefore in maintainable condition will have to receive full maintenance to ensure its sustainability. Put in place key missing links on the key transport corridors and ensuring that all sections on these transport corridors are rehabilitated/upgraded to ensure smooth flow of traffic thereby promoting national integration. Enhancing reliable all season access to rural and/or remote economic activity areas. Facilitating the delivery of agricultural inputs to farmers and evacuation of produce from the farms to increase yield and get prices so as to: Boost rural economy, and Bring down the level of rural poverty. Opening up all major population areas to modern economy, trade, and growth by providing transport infrastructure and services to achieve the goals of the Vision 2025 by giving deserving interventions in all trunk road sections. This means paving all the remaining 5,000 Km during the 10 years of the TSIP. Ensure that funding packages for implementation of special development plans and programs are available. These plans and programmes are such as: Mini Tiger Plan; Corridor Development Programs; Export Promotion Plans; Local Government Reform Program, and Other similar programmes. Give high priority to projects which will support manufacturing, mining, tourism, education and health. Similarly, high priority should be given to projects that are geared to the development of the local construction industry. This not only limits the extent of capital flight but will also enhance the local/national construction capacity Bring on board projects related to sector regulation (in civil aviation, marine, railways, and roads). Strengthening of regulations will assist to bring order in the development of the sector especially with the increasing private sector involvement Give priority to projects which will lead to promotion of export and key food crop production (meaning provision of good access to the key production areas). Transport should be able to respond to the needs of the productive sectors. Therefore investments and actions which have started to result into upsurge in production in agriculture, tourism, mining, and manufacturing should be enhanced. Give priority to projects that support poverty reduction efforts, including increasing the involvement of women in development and execution. Deserving consideration will be given to transport infrastructure projects which are geared to prevention of environmental degradation, HIV/AIDS, and which give due consideration to gender. Conduct master plan studies so that longer-term projects can be prepared based on the results of the studies. Examples are the Ports, Civil Aviation, Safety and Railways Master Plans. Give high priority to projects that will enhance exports. Examples include facilitation of economic/export processing zones, airport-handling facilities, modernization of port facilities, etc. This will further call for the need to easing of border crossing which has the impact of increasing international trade and also give high priority to projects that enhance regional trade and integration. Give high emphasis to actions which will enhance capacity building in strategic planning, project planning, budgeting, data base development, monitoring and evaluation. Bring to minimum the growing urban mobility crisis. USD 0.5billion is estimated to be lost in Dar alone annually-from loss in man hours, fuel consumption, and other vehicle operating costs. 46

64 (xv) Balance the level of transport network, and hence good services, with that of other SADC and EAC member countries. By any standard Tanzania has the lowest road network (96 m per square km) penetration or density in both SADC and EAC regions. Compare this with: Uganda m per square km Kenya m per square km Lesotho m per square km However, Tanzania needs to balance the challenge of additional network development with the need to keep the existing network intact. This underlines sustained maintenance of the existing network as the number one priority. 7.2 Maintenance of Existing Transport Infrastructure Strategy As a general principle, the TSIP will prioritize maintenance above improvements and capital works. In this regard the strategy for maintenance will therefore be given first priority to the regular maintenance of existing assets, which is usually of routine and relatively small-scale in nature. Second priority will be given to periodic maintenance which is usually provided at intervals of several years. These activities apart from generating modest economic returns, they are also important in prolonging the life of assets and contribute to its safety. An important part of the TSIP is to balance the needs for maintenance with the available funding. In this regard, the maintenance needs will be determined as well as the likely funds to be obtained from the budgetary allocation. In addition, the financing level/gap will be analyzed including the way, and when it is going to be closed. Roads maintenance is expected to be funded by the Government through Roads Fund while other institutions in the transport sector will utilize their own generated funds to carry the maintenance of their infrastructures. It is expected that for the first years of implementation of TSIP, Development Partners may be required to assist in closing the maintenance funding gap, when called upon Routine Maintenance Routine maintenance for the different transport modes infrastructure can be summarized as follows: Roads: routine maintenance includes activities such as ditch cleaning, minor repairs to road shoulders, pothole filling, and vegetation control. This is organized in different ways but is often a continuous activity. In terms of priority, recurrent maintenance also falls into this category, and includes activities required at a certain intervals in a year such as grading of unpaved roads. Railways: this includes the regular maintenance of the permanent way as well as the preventative maintenance of rolling stock and the maintenance of buildings. Air transport: routine maintenance includes vegetation control on airfields as well as the maintenance of buildings and air traffic navigational aids. Maritime transport: this covers the regular cleaning and maintenance of wharves and jetties as well as the regular servicing and maintenance of cranes and other port equipment. Pipeline lines: this covers the inspection of pipelines, minor repairs, vegetation control and regular servicing and maintenance of pumps and related equipment. Except for roads, routine maintenance of infrastructure for other sub-sectors will be paid for out of internally generated revenues. Routine maintenance for roads will be paid for from the Roads Fund which will be the first priority for expenditure from the Fund. 47

65 Periodic Maintenance Periodic maintenance is necessary at intervals of a number of years in order to prolong the life of the infrastructure. These are generally more costly than routine maintenance activities. The interval between these interventions can be estimated in advance, but may vary depending on the type of construction, actual conditions of use and environmental factors. For roads, periodic maintenance includes the regular resealing of paved roads and the re-gravelling of unpaved roads. Period maintenance will be the second priority for expenditure from the Roads Fund. For other transport modes, it includes the overhaul of equipment or repair of worn-out infrastructure. However, it does not include the wholesale replacement, rehabilitation or refurbishment of infrastructure Road Network Maintenance Maintenance Needs Projections (2007/ /12) The maintenance needs projections for the next five years for the road network has been made using a combination of analysis tools (HDM4 for TANROADS and DROMAS for Local Government) and conventional estimation methods which use unit costs, projected road condition and frequency or schedules of interventions. The analytical tools were applied to determine periodic maintenance needs while other needs for routine, bridges, emergency etc, a conventional method were used. The maintenance needs for periodic maintenance were averaged from the five year analysis. The maintenance needs for Trunk, Regional, District, Feeder and Urban roads are as shown in Table Road Maintenance Framework for 2007/ /2012 During the first phase of the TSIP, periodic maintenance will be applied to roads which are in fair condition in order to bring them back into good condition and as such extend their life span. In case of roads whose periodic maintenance has been deferred to such an extent that they have deteriorated into poor condition, these will have to be rehabilitated through the development programmes. The rehabilitation will be continued until when the backlog has been eliminated and all roads are in maintainable condition. Periodic maintenance for roads will eventually be fully paid from the Roads Fund. However, until the funding gap between total maintenance needs and Roads Fund revenues is eliminated, periodic maintenance will be partly paid by the Roads Fund and partly by Development Partners. The Roads Fund is a principle source of funds for road maintenance while funds from Development Partners support backlog maintenance and related institutional support activities. However, according to existing Government budgeting procedures, the Development Partners programmes are included in the development programmes and are therefore not considered as part of regular maintenance of routine and periodic maintenance, bridge maintenance and emergency works which is carried out widely over the road network. Table 7.1: Road Maintenance Requirements for 2007/ /12 (USD Million) Activity 2007/ / / / /12 Trunk and Regional Roads Routine Maintenance Periodic Maintenance Bridge Maintenance Emergency Repairs Spot Maintenance Administration and Supervision Non Works Activities Sub-total million USD District, Feeder and Urban Roads Routine Maintenance

66 Activity 2007/ / / / /12 Periodic Maintenance Bridge Maintenance Emergency Repairs Spot Maintenance 1) Administration and Supervision Non Works Activities Subtotal in million US$ Total (All roads) in million USD US$ = TShs 1) Envisaged to be financed by Development Partners Source: TANROADS, TEMESA and PMO-Regional Administration and Local Government Before 2007/08, the level of funding for maintenance was about 40% of the maintenance needs. However, in 2007/08 the Government took bold measures aimed at addressing maintenance requirements. In this direction, the budget for 2007/2008 has increased by more than twofold from USD million in 2006/2007 to USD million in 2007/2008 by increasing fuel levy from USD 8 Cents to 16 Cents per liter. The approved budget for Roads Fund for 2007/2008 is USD million coming primarily from fuel levy. The amount includes USD for administrative cost of the RFB, USD million for maintenance and USD million for development programmes. Based on the current allocation formula between Trunk/Regional roads and Local Government network of 70:30 and the anticipated roads fund collection, the projected allocation of roads fund to the implementing agencies will be as indicated in Table 7.2. The Government will continue to honor its commitment to fund road maintenance at the levels which are based on the estimates of maintenance needs in the next five years. If the funding level of 2007/08 is progressively increased by about 5% each year, the financing gap will be eliminated by 2011/12 for trunk and regional roads while for other roads it will be beyond 2011/12 (Table 7.3). This is therefore a maintenance activity where additional support from development partners is required in order to stabilize the paved road network. Table 7.2: Projected Allocation to Implementing Agencies (USD million) Financial Total Allocations to Implementing Agencies Years Revenue RFB MoID TANROADS PMO-RALG 2007/ / / / / Note: The figures for PMORALG include 10% for development works Source: RFB Table 7.3: Projected Funding for the Road Network (USD Million) Financial Year Maintenance Needs Actual Funding Funding Level Trunk and Regional Roads 2007/ % 2008/ % 2009/ % 2010/ % 2011/ % District Urban and Feeder Roads 2007/ % 2008/ % 2009/ % 2010/ % 2011/ % Source: RFB 49

67 Allocation of Roads Funds among Local Authorities Up to 2006/07, 85% of funds allocated to the Local Authorities were based on equity criteria. This resulted in all the Local Authorities getting more or less the same amount regardless of differing needs due to type of roads (paved/unpaved), road network lengths, type of area (urban/rural), etc. In order to rectify this imbalance in addressing the needs of various local authorities, PMO-RALG and the Roads Fund Board have developed a new allocation formula that is based upon the actual needs i.e. taking into account network size and its condition. This has been made effective from 2007/08 and some minor improvement of the formula will be agreed before 2008/ Absorption Strategies to Match Increased Maintenance Funds The maintenance funds of USD million for 2007/08 (excluding the USD million which is allocated for development works and RF administration) is quite substantial and poses a challenge to the implementing agencies which are to implement more road maintenance works and utilize much of the allocated funds before end of the financial year in June This challenge will have to be tackled even in the subsequent years as funding will be more or equal to the 2007/08 level. In order to overcome this challenge, the key players in the road sub-sector are required to implement strategies which were proposed from the key stakeholders consultative meeting on this issue of absorption capacity of the road fund allocations. In this regard, Table 7.4 gives actions that need to be carried out in the next three to five years Air Transport The total routine and periodic maintenance requirements for TAA in phase 1 amount to USD 16.7 million. However the approved budget for 2007/08 amounts to USD 3.87 million out of the required USD million for the same period, giving a financing gap of USD million. The approved amount s is from TAA own funds Rail Transport The Tanzania Railways Corporation (TRC) has been concessioned. In that case it will be the obligation of the concessionaire, Tanzania Railways Limited (TRL), to maintain the infrastructure. The maintenance financing problems is expected to be solved, except the backlog maintenance estimated at USD million. This may, therefore, be regarded as the gap that exists for RAHCO. Tanzania Zambia Railways Authority (TAZARA), on the other hand, has accumulated a backlog of maintenance of USD 61.3 million. 50

68 Table 7.4: Actions needed to absorb the Roads Fund Allocations to Agencies CHALLENGE KEY ISSUES STRATEGIES EXPECTED OUTCOME Inadequate Planning Procurement and Late preparation of budgets leading to late procurement of works The RFB to issue preliminary budget ceilings in January so that implementing agencies can start advance procurement Works implementation to start in July each year Lack of procurement plans Implementing agencies should prepare procurement plans by February of each year aiming at completing 75% of works by the end of June of the following financial year Minimize the amount of roll over funds to maximum of 25% Lack of multi-year contracts leading to more procurement frequency Implementing agencies should prepare multi-year plans for maintenance works This will enable having contracts with periods of more than one year and thus reduce frequency of tendering works PMMR projects that could absorb substantial funds have taken too long to commence PMMR contracts currently in pipeline should be implemented quickly so that funds allocated in the budget for the contracts start to be utilized. Will minimize roll over funds Carriageway and roadside works contracts are combined hence taking time to complete Separate carriageway and roadside works to involve more contractors in all classes This will speed up implementation of maintenance activities Small scale contractors are marginalized Implementing agencies should package contracts according to scale of works This will ensure that contractors of all categories get work opportunities Many small works contracts are re-tendered repeatedly Implementing agencies should prepare long-term contracts This will avoid having to retender small works repeatedly. CHALLENGE KEY ISSUES STRATEGIES EXPECTED OUTCOME Inadequate Works start late due to long PPRA should issue circular requiring This will enable works to start Planning and procurement process for small implementing agencies to use quotation early and have most of them Procurement works method to procure contractors for small completed before the end of the works less than Tshs. 100 million. financial year Contractors fail to complete projects due to low contract prices PPRA should issue a circular providing guidance on evaluation procedures that should consider unit rates This will avoid having contracts awarded at very low prices Inadequate Planning Procurement and Inadequate capacity for local contractors Lack of outreach programmes Current tender documents are too big and unsuitable for small works Implementing agencies do not adhere to the Public Procurement Act 2004 and its regulations Some implementing agencies use tender documents that are not approved by PPRA PPRA should issue guidelines to require Foreign contractors to enter into joint ventures with local contractors Implementing agencies should advertise business opportunities in road maintenance, equipment and related works including procurement notice. Implementing agencies should use the simplified version of standard tender documents issued by PPRA for small contracts. PPRA and key stakeholders should ensure that implementing agencies adhere to the Public Procurement Act 2004 and its regulations Performance Agreements should demand compulsory use of standard tender documents issued or approved by PPRA This will build up the capacity of local contractors Contractors and suppliers will be more aware of existing business opportunities. Small contractors will understand the documents easily. Transparency and accountability will be enhanced Harmonisation of tender documents will ease monitoring of procurement process Inadequate Supervision Monitoring and There is weak oversight roles by RFB, PMORALG, and TANROADS Shortcomings in implementation are not captured on time Funds are allocated based on equity criteria especially for LGAs There are no regulations that govern proper use of funds RFB, PMORALG, and TANROADS Headquarters should strengthen their oversight roles by improving monitoring and auditing. A simplified reporting format for monthly flash reporting should be designed RFB should ensure that funds allocated to TANROADS and the LGAs are based on maintenance needs. RFB should come up with regulations that include penalties for poor performance Road Users will be assured that there is value for money. This will facilitate arresting of shortcomings on time instead of waiting for quarterly reports This will ensure that roads needing maintenance get enough funds This will ensure that there is integrity in utilization of Road Funds. 51

69 CHALLENGE KEY ISSUES STRATEGIES EXPECTED OUTCOME Inadequate Local contractors lack basic Implementing agencies should Equipment availability will Capacity of construction equipment guarantee contractors to the Equipment be increased. Contractors/ Suppliers so that they can buy Consultants equipment. Loses in Revenue Collections Inadequate Capacity of Contractors / Consultants Existing Road Workshops do not have enough equipment Local contractors have inadequate financial capability Loans are not easily accessible Various training programmes for contractors/consultants are not harmonized According to the Financial Audit report by the National Audit Office Tshs.4.66 billion being uncollected fuel levy was observed during the 2005/2006. Local contractors lack basic construction equipment Existing Road Workshops do not have enough equipment Local contractors have inadequate financial capability Loans are not easily accessible Various training programmes for contractors/consultants are not harmonized Existing Road Workshops should use loans from financial institutions to purchase more equipment for road works. Implementing agencies should accept landed properties, equipment and insurance bonds as guarantees for advance payments. Government speeds up legislation on leasing finance so that Banks can provide loans to Contractors. Training programmes by ERB, CRB, NCC, and TACECA for Contractors/ Consultants be harmonized and rolled out to improve productivity and better utilization of resources.. A study to track fuel taxes will be conducted from September 2007 with the aim of finding out loopholes used to evade paying fuel taxes including fuel levy. Implementing agencies should guarantee contractors to the Equipment Suppliers so that they can buy equipment. Existing Road Workshops should use loans from financial institutions to purchase more equipment for road works. Implementing agencies should accept landed properties, equipment and insurance bonds as guarantees for advance payments. Government speeds up legislation on leasing finance so that Banks can provide loans to Contractors. Training programmes by ERB, CRB, NCC, and TACECA for Contractors/ Consultants be harmonized and rolled out to improve productivity and better utilization of resources. Equipment availability will be increased. This will enable contractors implement works quickly. This will assist the private sector and contractors through their associations to acquire equipment. This will improve the capacities of local contractors and consultants The study will also recommend necessary measures to plug the loopholes and hence will most likely increase the amount of revenue to the Fund. Equipment availability will be increased. Equipment availability will be increased. This will enable contractors implement works quickly. This will assist the private sector and contractors through their associations to acquire equipment. This will improve the capacities of local contractors and consultants Marine Transport Tanzania Ports Authority (TPA) appears to have overcome the problems of maintenance by setting aside USD 31.0 million for 2006/07 for the purchase of critical equipment and repair facilities. Currently, TPA projections on maintenance cost are estimated at USD 14.5 million annually for the first phase of TSIP Strategies for Bridging the Maintenance Funding Gap In general, the following strategies are been proposed for addressing the funding gap in transport infrastructure maintenance: (i) For the road sub-sector, the financing gap will be covered by natural growth in fuel consumption assumed to grow by 5% annually within the next five years; and in the mediumterm, the Government and the development partners are called upon to allocate additional funds for maintenance to bridge gaps in the requirements until other proposed resources are 52

70 (ii) (iii) mobilised. Other areas to be looked at for improving availability of funds for road maintenance include: Local Authorities using funds from their own sources. Introduction of new fees for services. Examining the possibility of involving private sector participation in road maintenance e.g. instituting Maintenance, Operate and Transfer Schemes for the transport infrastructure. Revenue generating agencies should have a better balance between operations, maintenance and investments. Deferring maintenance is in principle unacceptable. Strategies for increasing Funds should go in tandem with capacity building to increase absorption capability. 7.3 Development Programme Selection Criteria The criteria adopted for selecting infrastructure development projects under TSIP is based on the following: (i) Growth and poverty reduction does the project contribute to the reduction of poverty? To what extent can the project influence the overall increase of the GDP in transport sector? (ii) Corridor development: to what extent can the project play the role of opening up the country? (iii) Transit Trade facilitation: Can the project make use of the geographical advantages of Tanzania as being a transit country for the neighbouring land locked countries? (iv) Safety issues - the project which aims at improving safety issues in the transport sector is justified for being selected (v) Enhancing rural accessibility a project, which is aimed at reducing problems of transport and communication services in rural areas, is justifiable to be selected. (vi) Enhancing urban mobility Projects which are aimed at reduction of traffic jams and pollution and improvement of access to markets, service centers and unplanned settlements in the urban areas are justifiable for selection. (vii) National and Regional integration Projects with national and region impacts are eligible for being selected. (viii) Public service obligation Public service obligation is a service rendered at non-cost recovery tariff for strategic, political, and social reasons by the government. (ix) Cross cutting issues Projects with due consideration to cross cutting issues such as environment, HIV/AIDS and gender issues. Projects selected for each transport sub-sector are given in Annexes 2 to Prioritization Prioritization of projects selected for each transport sub-sector was carried out separately for each subsector as described below Road Sector Prioritization of Projects Goal To facilitate road transport corridor development through construction, rehabilitation and maintenance so as to have a smooth flow of goods and services and hence attract investment in other sector. 53

71 Objective To bituminize all unpaved trunk roads by year 2018 while at the same time ensuring that all regional roads as well as key district and urban roads are sufficiently rehabilitated and maintained to ensure smooth and safe flow of traffic. Efforts will be made to introduce new technologies for unpaved roads, where appropriate, to have better and longer lasting roads than the gravel ones Prioritization of Trunk Road Projects The scheduling of the works for trunk roads will adopt the following order of priority: (i) Priority 1: Preservation of existing assets by carrying out routine & periodic maintenance and rehabilitation works on the paved road network as and when determined by the HDM- 4 Model; (ii) Priority 2: Upgrading of gravel road sections along the corridors, giving highest priority to those sections carrying highest traffic first such as >500 AADT, >400 AADT, >300 AADT and >250 AADT in that order of priority; and (iii) Priority 3: upgrading of paved urban road sections to decongest traffic (iv) Priority 4: Social or security obligations projects which must be justified on a case by case basis Regional Roads The regional roads are prioritized based on the economic justification of the investment. The economic indicator adopted for the prioritization has been the Benefit/Cost ratio. All development works showing such ratio greater than zero have been retained for implementation. The discount rate was set at 6%. This discount rate has been used to take into account the overall development objective set out by GOT, the Agriculture Development Strategy and the MKUKUTA. The priorities were set as follows: (i) The first priority is the elimination of backlog works. (ii) The second priority considers the remaining roads selected for development (other than those already prioritized under backlog works). (iii) The third priority considers the balance of roads selected for development (other than those prioritized under backlog works and first priority). (iv) Road works not economically justified. The improvement of such works is decided according to the level of programme and availability of funds Local Government Roads The overall objective of the proposed investment programme for local roads is to support national policies and strategies on rural development and poverty alleviation through capacity building and development of the local transport infrastructure. In other words, the proposed investment programme shall support the achievement of the Tanzania Development Vision 2025, the Millennium Development Goals (MDGs), the MKUKUTA and the Rural Development Policies/Strategies. It is believed that the best way to support rural development and poverty alleviation through improved local roads is to implement projects that will improve access and mobility in rural areas as to facilitate the following key impacts: (i) (ii) (iii) (iv) Increased income from the agricultural sector; Opening up of potentially economic areas; Improved health and educational level of the people; and More time spent on productive activities and less on transport. 54

72 To improve access and mobility, the main strategy is to provide Basic Rural Access (BRA) for the major share of the population within as short time as possible rather than high quality access and service level for the few. Thus, the main priority for the first five years will be to provide Basic Rural Access in the entire network of District, Feeder and Urban Roads. BRA is the minimum level of service required in the local roads network to sustain socio-economic activities in rural areas. BRA Interventions are those with the least life-cycle cost to ensure reliable all-year passability for the prevailing means of transport in rural areas (i.e. 2WD pick-up trucks) and average travel speeds of at least 20 km/h. In view of the above and the priorities for TSIP stated in chapter the following criteria will be used to select projects for the local government roads investment programme: (i) Group 1: Projects that will facilitate Basic Rural Access on district and feeder roads. (ii) Group 2: Projects that will improve village travel and transport, i.e. projects that will reduce time, cost and effort by rural people to gain access to social and economic services and facilities and domestic activities. (iii) Group 3: Rehabilitation/upgrading projects on economically important district and feeder roads, e.g. those that will increase agricultural production, increase farm gate prices and open up new economically potential areas. (iv) Group 4: Projects that will reduce congestion and pollution on urban roads, e.g. in Dar es Salaam. (v) Group 5: Projects in urban areas that will improve access to neighborhood services and market centres and unplanned settlements. In the first five years of the TSIP, the main priority will be on projects facilitating Basic Rural Access (BRA). The available funding should allow for BRA on most of the district and feeder roads by the end of the first five year period. The VTTP will be expanded to all districts within the same period. Within the constraint of available funding and implementation capacity, rehabilitation of district, feeder and urban roads in group 3-5 will start and continue into the following five year period. Further prioritization within the groups will be as follows: (i) (ii) (iii) (iv) (v) Projects in Group 1 ranking of projects will be done within each district using the costeffectiveness-indicator (CEI) relating investment to population served. Projects in Group 2 will be prioritized by the communities themselves as reflected in their comprehensive O&OD village plans. Projects in Group 3 ranking will be done on economic bases reflecting reduced transport cost and the estimated increase in production and income from the agricultural or any other sector. Projects in Group 4 will focus on enhancement of urban mobility will be implemented with the intention to reduce traffic congestions in urban areas, particularly Dar es Salaam. The projects also include among others, feasibility studies on: Use of other modes of transport other than roads (e.g. railway and water) in Dar es Salaam and Mwanza; and Comprehensive urban transport plan for Dar es Salaam. Projects in Group 5 will be prioritized based on socio-economic criteria and community participation. The Dar es Salaam Rapid Transit (DART) Project, which is one of the institutional support projects under PMO-RALG, is meant to improve commuter services in the urban areas in the City of Dar es Salaam. It has gone through the inception and conceptual design stages and the implementation for the same is scheduled to commence soon. This project has been designed in such a way that, issues such as environmental pollution, provision of basic infrastructure including embarkation and disembarkation platforms, waiting sheds for commuters and right of way for other types of traffic have been considered in the project. 55

73 The first phases of the DART infrastructure development are estimated to cost USD 62.57million for the construction of roads in the main corridors totaling 63 km in the five years commencing in 2007/08. During the implementation of DART, projects for promoting multimodal transport will be considered aiming at creating a modal linkage between different modes of transport in terms of infrastructure and services Air Transport Goal To improve and expand air transport infrastructure to foster both domestic and international trade and tourism Objective The objective is to create conducive environments that will enable the promotion of private sector participation to manage and operate commercially viable airports projects through concession of the commercially viable airports and airstrips; reviewing of the existing legal issues and providing incentives to strategic investors Prioritization of TAA projects Prioritization and ranking of projects considers on-going projects first in case of additional funds required to conclude these projects. This basically means all projects that are part of the Medium Term Expenditure Framework (MTEF). Next to it are the proposed new projects, which are ranked in order of their EIRR values based on the 1996 study, of which studies for 7 airports are in the process of being updated under the World Bank funding. For airports that have no studies, ranking is based on the current traffic levels as well as condition of pavements at particular air ports, those to be upgraded are prioritized higher than those in need of maintenance. However, at particular airports in case of budget constraints priority for implementation will follow the following order: (i) 1 st priority: Safety related projects such as pavements on runways, apron, taxiways, airfield ground lighting system (AGL), fire tender, control towers including control facilities and equipments etc. (ii) 2 nd Priority: Security related facilities such as X-Ray machines, CCTV systems, and walk through metal detectors, security fences and security control related facilities and equipments. (iii) 3 rd Priority: Facilitation related facilities such as terminal buildings, aerobridges, escalators, air-condition systems. (iv) 4 th Priority: Commercial related buildings and facilities such as aircraft maintenance hangars, cold storage facilities, ground handling equipments, shopping and recreation facilities etc. are not part of the proposed projects and are already dealt with though private sector participation. The above criteria for airports, not withstanding the issue of selectivity of type of intervention starting with runway, aprons and taxi ways should be given top priority in as far as infrastructure investment is concerned. It should be noted that these priority order may change basing on the status of the airport infrastructure as in Table

74 Table 7.5: Summary of Prioritization of Projects at Particular Airport Airport Pavements (RWY/apron/taxi way) AGL, Fire, Equipment Security Equipment Julius Nyerere (DSM) 1 st 3 rd 3 rd 2 nd Songwe Airport 1 st 1 st 2 nd 3 rd Mwanza Airport 1 st 3 rd 2 nd 2 nd Mafia Island Airport 1 st 1 st 2 nd 3 rd Kigoma Airport 1 st 1 st 2 nd 3 rd Arusha Airport 1 st 1 st 2 nd 3 rd Bukoba Airport 1 st 1 st 2 nd 3 rd Tabora Airport 1 st 1 st 2 nd 3 rd Dodoma Airport 1 st 1 st 2 nd 3 rd Singida Airport 1 st 1 st 2 nd 3 rd Lake Manyara Airport 1 st 1 st 2 nd 3 rd Shinyanga Airport 1 st 1 st 2 nd 3 rd Musoma Airport 1 st 1 st 2 nd 3 rd Tanga Airport 1 st 1 st 2 nd 3 rd Mtwara Airport 1 st 1 st 2 nd 3 rd Moshi Airport 1 st 1 st 2 nd 3 rd Source: TAA Prioritisation of TCAA projects Facilitation (Buildings, etc) The Authority is facing various challenges as civil aviation regulatory body. These challenges include: (i) Lack of adequate air navigational aids for guiding aircraft flying in our airspace. (ii) High operating cost resulting from hiring office premises. (iii) Lack of strong Aviation Training Centre. (iv) Shortage trained pilots and Aircraft Maintenance Engineers to support the growth of aviation industry. (v) Lack of Aviation Master Plan that accommodate changes in policy framework. (vi) Lack of experts in field of Economic Regulation that is important for promoting aviation industry. (vii) Lack of Management Information System that links the headquarters and its centres across the country. (viii) Lack of Civil Aviation Statistics database that allows accurate and timely collection of data. Selection criteria and prioritization of the projects to be undertaken are based on the need to address the above-mentioned challenges. The following projects are to be implemented in the first phase of the Transport Sector Investment Program (TSIP). (i) Procurement of Air Navigational Aids Project: Provision of air navigation services for guidance for aircraft using our airspace, it will enhance safety of our airspace. (ii) Construction of Aviation House: Implementation of this project will enable the Authority to reduce operational cost incurred on renting office premises, hence efficiency and cost effectiveness. (iii) Enhancement of the capacity of Civil Aviation Training Centre: Enhancing capacity to provide training for local experts; Cost minimization for training experts abroad; and Training centre will be also be used to train other experts from other neighbouring countries. (iv) Establishment of Training Fund: Currently, aviation industry is facing shortage of trained personnel. The available experts are getting older and therefore there is a need to have training fund to address the problem. (v) Management Information System: The project will enhance Authority s efficiency and effectiveness through both data and voice transmission. 57

75 (vi) (vii) (viii) Civil Aviation Master Plan: The project will enable the Authority to review the policy framework to accommodate changes that take place nationally, regionally and globally. Building Economic Regulation Capacity: The project will enable the Authority to have adequate experts in the field of Economic Regulation. Three year training programme is to be implemented, including short and medium courses of up to one year. Civil Aviation Statistics Database: The Database will enable the Authority to have timely and accurate data which is extremely important for planning. The Database will enable operators to file key information on daily basis Railways Goal To rehabilitate, improve and expand railway network to enable exploitation of transport bulky natural resources and evacuation of products especially where long distance transport is involved Objective The policy objective on the railway transport is to improve and expand railway network to enable the railway to play its role in the economic development of the country. The envisaged strategy to achieve this objective among others is to: (i) (ii) Facilitate private participation in the provision of interchange and interface facilities; providing linkages (bridges, crossings) as well as locomotives and wagons for effective transportation of goods, and Undertake a Railway Master Plan study during Phase 1 of TSIP to determine the extent of the network expansion and modernization. Generally, for railways operational activities to be effective, acceptable availability levels in track, communication performance indicators levels in track, communication, motive power and rolling stock availability and rolling stock are critical Prioritization of TAZARA Projects Records on performance indicators for TAZARA reflect levels on some areas to be far below the acceptable limits thus calling for radical actions to reverse the trend (Table 7.6). Table 7.6: TAZARA Operational Performance Indicator Performance Indicator Required Standards TAZARA Actual Track availability >95% 88.5% Locomotive availability >75% 68.8% Wagon availability >85% 68.2% Coach availability >85% 70.0% Communication channel availability >94%. 28.0% Source: TAZARA According to Table 7.6, TAZARA has been adversely hit especially in 4 areas viz. motive power, rolling stock, track and communications. Therefore, the submitted projects by TAZARA in excess of USD million are taking into considerations the fact that problems facing core business of the organization are fully addressed. Prioritization of the TAZARA ensures that the impact of these projects on the operational efficiency of TAZARA are complementing each other, and that failure to perform by one component will greatly affect other areas in particular and the overall performance of the organization in general. With the exception of the proposed new railway links project i.e. Lindi- Mtwara-Makambako, Tunduma-Sumbawanga-Kigoma and Sumbawanga-Kasanga, all other remaining projects are of rehabilitation nature along TAZARA line. In view of the above, execution 58

76 of TAZARA projects related to operational areas are treated as a package since each of the four components is in a dire/poor state Prioritization of RAHCO & TRL Projects The first priority for Reli Asset Holding Company (RAHCO) is to enhance the load carrying capacity of the trains by working on critical sections of the rail line including Makutupora -Saranda (km 546 km 568) section along the Tabora - Dodoma, which is the main capacity restriction point. Also, capacity will be enhanced through extending loops in some stations for 30 wagons trains i.e. 13 stations on the central line, and introduction of Centralized Traffic Control between Morogoro and Dodoma. Other projects are the following: Develop other Inland Container Depots such as Mwanza, Kigoma, Tabora, etc.: Through such inter-modal terminals, TRL will become a cohesive part of Tanzania transport services catering for North South and regional traffic streams. TRL will indeed compete effectively with road transport; Bridges rehabilitation; Signalling and Telecommunications investment; Purchase of equipments for depots (wagon maintenance) Maritime Transport Goal To enable the economy use waterways transport as a cheaper type of mode and an alternative to other modes for areas which border rivers, lakes and the ocean Objective To develop, rehabilitate and maintain marine transport infrastructure and improve human resources responsible for managing and operating the infrastructure and services Prioritization of Maritime Projects Prioritization of Ports Projects considers On-going projects which are part of the Medium Term Expenditure Framework (MTEF) are considered first, urgent rehabilitation and replacement projects, and projects to be determined by the Port Master Plan Study. A summary of prioritization of ports projects is given as follows: (i) (ii) (iii) First Priority: Ongoing projects: rehabilitation and replacement of equipment at cargo terminal, grain terminal operational improvement, Kurasini Oil Jet (KOJ) improvements, improvement of marine services at DSM port, establishment of port community system, implementation of ISPS code, navigational aids, improvement of Tanga and Mtwara ports operations. Second Priority: Critical rehabilitation and replacement of Single Point Mooring (SPM) and pipeline, conversion of 2 berths at general cargo terminal to handle bulk carriers and construction of Jetty on Mafia Island. Third Priority: To be determined by Port Master Plan Study The list of ports for the study are rehabilitation of Mwanza port north, rehabilitation of link span and improvement of port infrastructure on lake Victoria, Kemondo bay rehabilitation, dredging of DSM port entrance channel, Lakes Tanganyika and Nyasa navigational aids, development of Mbamba Bay and Itungi ports and Bagamoyo port construction. 59

77 7.4 Sub Sectoral Investment Requirements Roads The proposed investment for the period 2007/ /12 will include development projects and maintenance of trunk, regional, district, feeder, urban and community roads, and institutional development and capacity building. Projects considered for the program include all ongoing projects. The projects also include construction of the infrastructure for the initial phases of the Dar es Salaam Rapid Transit (DART), procurement of six new ferries, rehabilitation of five existing ferries and their maintenance. Others are construction of the Kigamboni and Kilombero bridges, road safety programs and procurement of solar system for Dar es Salaam traffic lights. The total estimated cost is USD 3,845,467 million of which USD 2, million is for rehabilitation and upgrading of trunk and regional roads, USD 630 million is for maintenance of trunk and regional roads, USD 15 million is for procurement and maintenance of ferries, and USD 429 million is for the improvement and maintenance of local roads. Table 7.7 outlines required investment for trunk and regional roads while Table 7.8 outlines the cost estimate for local roads for the first phase of the five years programme. The proposed investment for local roads will provide Basic Rural Access in most of the 15,000 km of district and feeder roads where reliable access is still a problem. The budget for the VTTP allows for implementation of the Program in all districts. Table 7.7: Investment Requirements for Trunk and Regional Roads (USD 000) S/N Project Description 2007/ / / / /12 Planned Cost 1 Trunk Road Development (Upgra including Dar es Salaam Rapid Trans 393, , , , ,857 2,984,910 2 Trunk and Regional Roads Maintenance Works 125, , , , , ,883 3 Regional Roads Development Projects 46,614 29,697 41,455 12,473 12, ,712 4 Rehabilitation and Procurement of 7, ,811 2,811 Ferries 12,766 5 Maintenance of Ferries ,390 6 Kigamboni and Kilombero bridges ,733 7,000 6,111 25,000 7 Maintenance of Bridges 5,281 5,301 5,322 13,245 14,091 43,240 8 Road Safety ,366 9 Dar es Salaam traffic lights ,200 TOTAL 578, , , ,920 1,032,493 3,845,467 Source: Ministry of Infrastructure Development Table 7.8: Investment Requirements for Local Roads (USD 000) S/N Project Description 2007/ / / / /12 Planned Cost 1 Establishing Basic Rural Access 5,866 11,733 19,554 22,769 22,769 82,691 2 Improved Village Travel and Transport (VTTP) 3 Rehabilitation/upgrading of economic rural roads 1, ,461 2,096 4,161 5,475 6,825 8,365 26,922 4 Reduced urban roads congestion 3, , , ,846 5 Improved urban roads access ,385 2,154 2,923 7,846 8 Maintenance (routine/periodic and bridges) 9 Capacity Building and Program administration 51, , , , , ,447 3,365 3,346 2,808 2,558 2,115 14,192 Total 67,873 77,529 90,852 93,699 99, ,406 Source: PMO-RALG 60

78 Map 7:1: Proposed Trunk Roads Projects for TSIP (Phase 1) Source: TANROADS Table 7.9 shows the total requirements for the road sector for both development and maintenance programme for the first phase of TSIP. Table 7.9: Summary of requirements for roads sub sector (USD 000) Organization 2007/ / / / /12 Planned Cost TANROADS 578, , , ,920 1,032,493 3,845,467 PMO-RALG 67,873 77,529 90,852 93,699 99, ,406 Total 646, , , ,619 1,131,946 4,274,873 The details and the timings for implementation of the roads programmes are shown in Annex 2. To achieve the road physical infrastructure projects set in the First Phase of the TSIP (2007/ /12), about USD 4,275 million have been estimated out of which USD 1,716 million or 40% has already been committed or secured. 61

79 7.4.2 Air Transport Investment Requirements In the air transport sub sector, aviation investment sub-programme covers among others the Tanzania Airports Authority (TAA) and Tanzania Civil Aviation Authority (TCAA). They include airports infrastructure projects as well as economic projects to enable smooth management and operations of the regulatory arrangements (Map 7.2). Timing and approximate costs for implementation of the TAA projects is shown in Annex 4. The summary of financial requirements for Air Transport maintenance and development projects for first phase of the TSIP are outlined in Table Table 7.10: Summary of Development and Maintenance Requirement for Aviation Sector (USD 000 ) Organization 2007/ / / / /12 Planned Cost TCAA 3, , , ,130 1,130 15, TAA* 3,872 3,744 3,723 2,679 2,679 16,697 TAA 31,443 38,934 49,043 75,635 75, ,690 Total 39, , , ,444 79, , Source: TCAA & TAA TAA* - Maintenance requirement Air Transport Regulation Investment Requirements The issues listed in Table 7.6 will be addressed by TCAA during the first phase of the TSIP at a cost of USD million:- (i) (ii) (iii) (iv) (v) (vi) (vii) Addressing Deficiencies in the Air Navigation Field including procurement of Air Navigation Aids; Building Economic Regulation Capacity; Civil Aviation Master Plan (CAMP); Civil Aviation Statistics Data Base; Construction of Civil Aviation House; Capacity Enhancement of the Civil Aviation Training Centre (CATC); Establishment of Training Fund; Management Information System Timing and approximate costs for implementation of the TCAA projects is shown in Annex 3 62

80 Map 7.2: Proposed Airports Projects for TSIP (Phase 1) Source: TAA Existing Airports Proposed Airport Projects TAA Investment Requirement To achieve the air transport physical and security infrastructure development and maintenance programmes set in the First phase of the TSIP (2007/ /12) USD 303 million of which USD million is for improvement of safety by TCAA and USD million is for development and rehabilitation of airports. Out of the total investment of USD 303 million, USD million or 56% has already been committed or secured from internal revenue collection projections. The private sector will be involved as much as possible in the management of the strategic airports. Investments for increasing capacity in these airports will depend on the level of traffic generated annually. Some Government financial support will be engaged to guarantee their safety operation and service. The total estimated cost is USD 301 million. 63

81 7.4.2 Railway Transport The total cost of the required development investment and maintenance requirement in the railway sector in the First Phase of the TSIP (2007/ /12) amounts to USD million (Table 7.11), out of which USD million or 37% has already been committed from the internal revenue collection projections and other sources. Table 7.11: Summary of Development Investment and Maintenance Requirement for the Railways Sub sector (USD 000 ) Financing Requirement 2007/ / / / /12 Project Cost (USD) TRC 44, , , , , , TAZARA 18, , , , , , Total 63, , , , , , Source: TRC & TAZARA RAHCO and TRL Investment Requirement The total amount required by RAHCO and TRL in the next five years of TSIP for investing into the railway in terms of improvement of the railway infrastructure, maintenance of permanent way, strengthening of operations and existing rolling stock and institutional support is USD 744 millions. The Action plan to implement the proposed RAHCO and TRL development and rehabilitation projects for the First Phase of TSIP is appended as Annex 5. Recommended areas for investments in TRL network include; critical section of Makutupora to Saranda (km 546 km 568) between Tabora and Dodoma, which is the main capacity restriction point in the Central line. About 6% of the total traffic does not touch the critical section. According to recommended levels of investment required to increase capacity through the Transport Infrastructure Master Plan study for Tanzania Mainland year 2002; the investments to increase capacity lies on the enhancement of RAHCO line infrastructure through extending loops in some stations for 30 wagons trains; 13 stations on the Central line and also introduction of Centralized Traffic Control between Morogoro and Dodoma. Furthermore, in order to increase future capacity for Inland Container Depots (ICD), other Inland Container Depots at Mwanza, Kigoma, Tabora, Morogoro and Arusha will be developed in the first instance followed by others at Tanga, Shinyanga, Arusha, Dodoma and Mpanda. It is considered that, through such inter modal terminals; it will be possible for TRL to become a cohesive part of Tanzania transport services catering for North South and regional traffic streams as well as historical port of Dar es Salaam to the hinterland traffic. This will also help TRL compete effectively with road transport. In line with the concession agreement, the Government and the Concessionaire will fund the investment required for infrastructure improvement and rehabilitation to lead to higher business. Other areas for future investments in TRL in the first phase of the programme are the following categories: Permanent way and bridges rehabilitation; Signaling and Telecommunications investment ; Purchase of equipments for depots (wagon maintenance). Furthermore, several feasibility studies will be conducted during implementation of TSIP as follows: Feasibility study Isaka - Rusumo - Kigali Railway Railway Master Plan Study Feasibility Study of Arusha Musoma line Maintenance requirements for RAHCO Line in the first phase of the TSIP add up to USD 105 million as shown in Table

82 The Government plan after the first phase of the programme is to build new railway lines to carter for increased demand. The lines will include a link between Burundi and Rwanda (Kigali) to the TRL at Isaka and a new transit route for Uganda traffic to Tanga via Musoma (lake services) and Arusha (new railway). The above proposed additional railway infrastructures will provide land locked countries with the capacity of moving 60% of their traffic. Traffic generated from the new railway line will justify Tanga to a deep water port from a lighterage port. Likewise, with the new railway infrastructure after just completed concessioning of TRC and later TAZARA, the two railway lines will be party to the provision of tourist services through private sector train operators. Table 7.12: TRL Maintenance requirements for first phase of the TSIP (USD 000 ) YEAR 2007/ / / / /12 Total Maintenance Requirements 11, , , , , ,000 Source: RAHCO TAZARA Investment Requirement The total investment required for short, medium and long term investment programmes of TAZARA, including its railway infrastructure, strengthening of its operations and institutional support is estimated at USD 202 million. The Action Plan to implement the proposed TAZARA development and rehabilitation projects for the First Phase of TSIP is appended as Annex 6. What may be noted is that TAZARA is jointly owned by two governments of Tanzania and Zambia. Modalities for mobilization of funds and implementation of projects need to be worked out. TAZARA will proceed with replacement of aged assets, to cater for traffic growth particularly heavy mineral traffic (coal deposits etc). It will also proceed with investments geared towards increasing container handling facilities to meet the private sector development of container transfer terminals requirements The increase in traffic levels, will necessitate the introduction of automatic train stopping equipment at all stations and on all locomotives to enhance safety and avoid collision. Furthermore, TAZARA will build two new lines to provide links between the Southern part of Tanzania (including the Mtwara Corridor), TAZARA, the Central Corridor and the Great Lakes Region through ports along Lake Tanganyika (Map 7.3). The completion of these two lines shall facilitate the tapping of the mineral rich potential of Liganga and Mchuchuma iron and Coal ores respectively to the outside market and hence effectively support the market growth requirement of the region i.e. Tanzania, Malawi, Zambia and the Great Lakes Countries. Creation of new jobs is also expected from these new lines. 65

83 Map 7.3: The Proposed and Existing Tanzanian Railway Network Kigali Musoma A= Central Line B= Tanga Line C = Link Line D=Mwanza Line E=Mpanda Line F = Singida Line G = Kidatu Line Proposed Line Sumbawanga Kasanga Port Makambako Lindi Mchuchuma/Liganga Mtwara Source: MID TAZARA Maintenance requirements for first phase of the TSIP are shown in Table Table 7.13: TAZARA Maintenance requirements for first phase of the TSIP (USD 000 ) YEAR 2007/ / / / /12 Total Maintenance Requirements 10, , , , , , Source: TAZARA Maritime Transport Investment Requirement To ensure that the maritime sub-sector development is harmonized and an integrated development is achieved, TPA intends to conduct a Strategic Port Master Plan study which will determine the short and long term developmental requirements. The study will cover all ports, i.e. sea ports and inland waterways ports. It is expected that implementation of projects identified in the Master Plan will commence during the first phase of TSIP. For the First Phase of the TSIP (2007/ /12), about USD 457 million (Table 7.14) has been estimated out of which USD 239 million or 52% has already been committed from the internal revenue collection projections and other sources. Map 7.4 shows the proposed Tanzania Ports Authority Projects for TSIP (Phase 1) while the Action Plan to implement the proposed TPA components for the First Phase of TSIP is appended as Annex 7. 66

84 Table 7.14: Summary of Development Investment and Maintenance Requirement for the Marine Sector Phase 1 of TSIP (USD 000) S/N Project Description 2007/ / / / /12 Amount (USD) 1 Development Projects 45, , , , , , Maintenance of Port Facilities and Infrastructure 7, , , , , , TOTAL 52, , , , , , Source: TPA The principal objective of the programme is to undertake carefully identified projects, which will sustain continuous growth of port traffic, cope with shipping technological changes and increase efficiency and productivity of the port sector. The programme is also intended to ensure the sustainability of compliance with regard to Security and Safety requirements, to provide better outlet to foreign markets for landlocked countries, restore capacity lost through deterioration of facilities in the inland ports and human resource capacity building. Furthermore, the present condition of some of the port facilities requires immediate attention in order to maintain the terminals capacity and level of service. Some will require capital for rehabilitation due to the fact that the concessioning of most of the coastal ports like Tanga, Mtwara and Mafia as well as inland water ports like Mwanza and Kigoma are unlikely to occur in the short term. There has been large increase of the container traffic at the port of Mtwara. With the development of the Mtwara Corridor, the traffic is going to increase rapidly and therefore studies to determine the level of infrastructure required will definitely be undertaken. The same intervention will be required for the port of Tanga. Similarly there is an immediate need for improvement of the basic port facilities in Mafia Island port. Also, a number of cargos handling equipment and floating craft to supplement the existing fleet will be acquired Parallel to the privatization plan for the Marine Services Company Limited (MSCL), there is an urgent need for infrastructure rehabilitation investments for the inland ports particularly on the Link span, Slipways and dredging at Mwanza North, Kemondo Bay, Musoma, and Kigoma port. 67

85 Map 7.4: Proposed Tanzania Ports Authority Projects for TSIP (Phase 1) 1. Reh. of Mwanza Port North 2. Reh. Of Kemondo bay 1. Improvements to Tanga Port 1. Installation of navigation Aids Lake Tanganyika Kemondo Bay 1. Nav. Aids Lake Nyasa 2. Construction of piers at Mbamba Bay and Itungi Kasanga Mwanza Construction of Mafia Jetty Itungi Mbamba bay Mtwara 1. Improvements to Mtwara port 1. Dredging Entrance channel &improvements of the Port 2. G/Cargo Terminal infrastructure & superstructure 3. Grain terminal upgrading 4. Port Community System 5. ISPS code implementation 6. KOJ Improvement 7. Improvement to Marine Services 8. Upgrade Navigational Aids along coastal waters Source: TPA 7.5 Institutional Support Projects focused on institutional support of the transport sector will act as a lever to strengthen capacity building, and, hence, speed up the transport sector growth through institutional support. The areas of focus include strengthening transport sector in the collection and processing of transport data, transport policy development, strategic planning, coordination, evaluation and monitoring and strengthening capacity in decision making. These will require investments in human resources and technological development e.g. ICT, meteorology, etc. The essential requirement is to have an interfacing knowledge sharing and equipment interface, effective and efficient medium of information exchange. Investment requirement for institutional support development and human resources capacity building is summarized in Table The total cost required for institutional support and human resource capacity building for the transport sector amounts to USD million. 68