Transportation

How many billions can Tanzania fetch from ports?

Tanzania is geographically positioned at strategic corridor to prove billions from its marine transport corridor

Tanzania is one of Southern Africa Development Community (SADC) member states with strategic port spheres, that stand to prove billions, under strategic import and export situations.

Bank of Tanzania (BoT), indicates East Africa's growing economy, Gross Domestic Product (GDP) stands at 6.6 per cent, while construction, transport activities and agriculture (raw material producer) account for 65.1 per cent of the output growth.

An array of materials gets shipped off Tanzania which include minerals—gold and agricultural products such as cashew nuts, coconut, sisal, coffee, and raw cotton.

On the same note, BoT September economic review, paints a rather promising perspective commenting that: exports of goods and services amounted to $921.8 million in August 2019 compared with $ 714.8 million in the preceding month, of which export of goods increased to $ 635.1 million from USD 408.9 million.

Additionally, traditional goods exports (unprocessed minerals and agriculture-products) stood at $44.4 million compared with $ 12.9 million in the preceding month, as all traditional export crops improved except coffee and tea.

Still, the value non-traditional exports increased by 48.5 percent to $532.9 million in August 2019, minerals, particularly gold, manufactured goods, and horticultural products being the key drivers of growth.

In that context, Tanzania is tirelessly striving to garner more foreign currency via strategic ports across the country in 6 different locations.

Tanzania Ports Authority (TPA) is a key denominator in the latter, whereas its fundamental role in regulation and licensing port and marine services and facilities. More importantly, TPA manages vessel traffic in the port while ensuring safety and security.

TPA serves quite a robust market base, including Tanzania's hinterlands and landlocked trade partners—Democratic Republic of Congo, Burundi, Rwanda, Zambia, Zimbabwe, Malawi, and Uganda.

Port operational capacity

Ministry of Works, Transport and Communication records, point out that: in the fiscal 2018/2019 TPA serviced 6.952 million tons, compared to 6.658 million tons between July and December 2017.

Further, TPA and Tanzania International Container Terminal Services (TICTS) attend to 361,430 TEU’s (Twenty-Foot Equivalent Unit) between July to December 2018, compared to 363,145 TEU’s in 2017/2018, which is equivalent to 0.5 per cent.

The Observatory of Economic Complexity data show that: by 2017 Tanzania exported over $ 5 billion, which ranked Tanzania as the 107TH exporter in the world. Thus, top export destinations are India, South Africa, China, Vietnam, and Switzerland.

The same applies to importation, whereas Tanzania ports—services agriculture machinery, petroleum products, automobiles, and other sorts of consumer goods.

Per the Ministry's records, principal commodities handled at main ports in Tanzania, show a significant increase in amount of cargo serviced. From 9,36,690 million tons in 2012 to 14,607, 393 in 2016.

Existing potential

At present, the government spends an average of $250 million (Sh575 billion) per year to enhance the capacity of six major ports to support development and industrial growth, necessary to attain a mid-size income.

However, TPA Director, Deusdedit Kakoko highlighted various issues crucial to foster the port economy in Tanzania, as cited by The Citizen.

"Success of the port depends much on collaboration among member states and port stakeholders port operators, government agencies, shipping agents and clearing and forwarding agents," Kakoko added

Tanzania has made rather strategic improvements in the sub-sector, whereas—ports markets have been expanded, in the East African corridor, including office opened in DRC, Zambia, Rwanda, Burundi, and an agency in Kampala-Uganda.

However, TPA is faced with a couple of challenges, including “ghost ports”—operating outside the TPA operational procedures. There are over 437 ghost ports, across Tanzania, but the-government of Tanzania plans to evaluate these ports and choose either to improve them or abolish their operations.

Ports have proven to be vital economical apparatus in Tanzania, as TPA manages main and small ports in Tanzania, strategic improvements should be initiated, especially on supporting infrastructures interconnected with ports such as railways (established in Tanzania currently).

Source: The Exchange

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