Here’s why local transporters have been losing money in transit goods business
Dar es Salaam. Tanzanian transporters are losing money due to their failure to effectively utilise the country’s geographical position in transporting cargo to neighbouring countries.
Data produced at the annual general meeting for Tanzania Truck Owners Association (Tatoa) at the weekend showed that local transporters were only utilising 25 per cent of the transit goods business potential.
This, according to Tatoa board chairperson Angelina Ngalula, was due to failure to use the potential provided under the East African Community Customs Management Act (EAC-CMA) and a lack of coordination among stakeholder in both public and private sectors.
“If the EACCMA were well-utilised to facilitate trade within the EAC and Southern African Development Community (Sadc) blocs, we would transport cargo to all those countries easily,” she said.
Also, lack of regular meetings makes it difficult for them to hold functional dialogue on resolving the challenges.
“Even when meetings are held, responsible people do not attend. They send representatives who have no power to make decisions,” she said.
Other barriers are congestion on port access roads; delays at Tunduma and Kasumbalesa border-crossings; shortage of ‘holding’ areas; multiple levies by different authorities; unpredictable business environment; mismatch of laws and regulations within EAC and Sadc blocs, and lack of integrity among transporters and clearing agents.
Tatoa members currently have athecapacity to transport 13.5 million tonnes of cargo yearly; but they transported only 5.1 million tonnes last year (2018).
“With more than 25,000 trucks at the moment, our members can transport 7.5 million tonnes of cargo at at a go; but this can only be achieved if the challenges are resolved,” she said.
Ms Ngalula also explained how the transit goods sub-sector can quickly attract at least 2.45 million tonnes - and generate $400 million - within next three to six months.
She said the sub-sector has the potential to handle one million tonnes of assorted minerals, 350,000 tonnes of sulphur, 100,000 tonnes of tobacco and one million tonnes of fertiliser from neighbouring landlocked countries.
“These goals can be quickly achieved if and when the country waives customs warehouse rent on bulk cargoes, extends the ‘free transit’ period, allows bagging of some goods outside the port areas and bulk sulphur,” she revealed.
Works, Transport and Communication minister Isack Kamwelwe said the government is now taking several measures to apply common policies, laws and regulations within the EAC and Sadc economic blocs to ease the transit goods business.
“We have so far removed escorting fees, and allowing cargoes to move despite the challenges of accessing seals,” he said.
He further promised to ban the use of manual cargo declarations in ports with a view to effectively controlling the fabrication of documents.
“Only online cargo declaration will be allowed. This will help to monitor all the procedures used to declare the cargoes from at the starting points,” he said.
