Rail Transportation in Sub Saharan Africa. CC Africa Africa Rising Conference

Transcription

1 Rail Transportation in Sub Saharan Africa CC Africa Africa Rising Conference Name Derrick Lichti Date March 19, 2013 City Montreal

2 Introduction Consultant with CPCS Infrastructure consultancy specializing in Power, Rail, Ports, Urban Transit, and Urban Development HQ in Ottawa, full time offices and divisional HQ in Nairobi and Abuja

3 Presentation Outline Overview of the rail concessions in Africa What has happened? A look at some of the key issues Take a closer look at the RAHCO/TRL railway in Tanzania (formerly TRC)

4 Rail Service in Africa 51 operating railways in Sub Saharan Africa 16 concessions to date The privatization route has been a rough one Mixture of meter gauge, cape gauge, and standard gauge

5 Rail Service in Africa Issues Despite successful closing of the transactions, the railways have failed to perform well Uneven playing field: continued development of the road network Traffic has not materialized as expected Concession were not capitalized well and ran into problems when cash flows did not grow sufficiently

6 Rail Service in Africa Issues Deferred maintenance Track repairs not performed on a timely basis Locomotives used beyond their service lives and major overhauls are often delayed Maintenance backlogs continue to grow Level of service declines Speed restrictions Poor rolling stock availability Difficult to maintain schedules and provide consistent service to customers, meanwhile a batch of trucks is often waiting to move the cargo for your customer

7 Rail Service in Africa Issues Passenger Service Obligations Cash flows typically don t even cover operating costs, let alone capital costs Tariffs are typically regulated Requires cross subsidies from freight (who are cash strapped as it is) or from the government Many are operating old and deteriorated coaches beyond expected service lives Unsafe No available money to replace them Mixing passenger and freight service on the same lines will slow down the freight service, making it less competitive

8 Rail Service in Africa Issues

9 Rail Service Issues The road has captured traffic due to: Uncompetitive transit times Poor reliability of service Added convenience of door to door service All this despite road tariffs typically being higher than rail Re capturing traffic is no simple task

10 Rail Service Tanzania

11 Rail Service Tanzania Traffic has steadily decreased since 2003 (not including TAZARA)

12 Rail Service Tanzania Almost complete loss of rail traffic business M tonnes/yr M tonnes/yr (estimated) Extremely low axle loadings Central line partially converted to 80lb/yd rail But much 56 and 60 lb/yd rail remains Thus limiting speeds Rolling stock availability 9 12 operating locos for freight traffic Limited to 14 tonnes/axle (6 axle loco limited to 84 tonnes) Cash inflow is poor and not sustainable Not able to meet payroll or buy diesel Service disruptions along the main line on the Mkondoa River Track washouts between Kilosa and Gulwe stations Deteriorated state of fixed infrastructure Temporary Speed Restrictions Lengthy concession process (~5 years) Minimal maintenance done during this period

13 Rail Service Tanzania Considerable investment in fixed infrastructure and rolling stock is required Removable of speed restrictions will help increase quality of service Growing traffic will increase the revenue and improve cash flow Large volumes traveling by truck are severely damaging the road network Elimination of the fuel tax on the railway will help put it on a more level playing field with the road transportation network

14 Rail Service Tanzania

15 Rail Service Tanzania Is there enough traffic to justify the rail network? 25,000 20,000 15,000 TEU 10,000 Road Rail 5,000 0 January Februar y March April May June July August Septem ber October Novemb er Decemb er Road 16,433 13,456 15,117 14,437 15,804 15,210 16,808 17,753 17,409 16,640 23,129 18,902 Rail Month TPA, 2011

16 Rail Service Tanzania

17 Summary of Issues Passenger Service Obligations (PSO) Deferred maintenance Extensive work required on the bridge and track infrastructure Signalling system is heavily vandalised Human resources Aging workforces Young staff entering barely functioning railways Competition with the road Inventory carrying cost Collection and delivery transhipment Fuel taxes paying into road funds

18 What can be done? Reduce network size Review operations on branch lines and close noncommercially viable track Streamline operations Cut unprofitable customers Focus on large, high volume customers that require consistent service Increase traffic levels Additional traffic is required to increase the revenue New customers Increase modal share Grow economies of scale Adjust passenger service obligations Financial support will be required for the medium (freight) and long (passenger) term

19 Final Words Thank you