TZ@60: What it will take to benefit from SGR

Dar es Salaam. If there is anything that Tanzania has learnt in the past 60 years, it is that, it is too expensive for a poor, developing country to meet operational costs of a railway network of thousands of kilometres alone. Building one is even more costly. Falling into disrepair of the Tanzania Railways Corporation’s central line (Metre Gauge Railway) was not entirely due to mismanagement. If it was, then RITES of India - which efficiently manages the largest railway network in the world in terms of number of passenger volumes back home - could have pulled it off when it took over management of the Tanzania central line railway. But it didn’t.

The issue is that the railway infrastructure in Tanzania, like elsewhere in Africa, was built to feed the economic pattern that does not favour Africa. Africa’s railways point to the direction of industrial bases of the West. They were designed to carry bulky agricultural goods, timber and minerals from plantations, mines and forests not to industries in Dar es Salaam, Morogoro, Mwanza, Arusha, Rufiji, Kisarawe or Bagamoyo. The lack of logistical links between our railways and our roads, our production centres and with all countries that surround us means the government invests too much money in its operation with so little economic benefits.

SGR

After 60 years of using the Metre Gauge Railways (MGR) Tanzania decided that it would start the new journey into the next six decades with the Standard Gauge Railway (SGR). The SGR construction will run the entire length of the central line system and beyond. The first phase of the SGR construction (Dar es Salaam to Mwanza) will cover a distance of about 1,219km. The other phases that include Tabora-Kigoma; Uvinza-Burundi border; Kaliua-Mpanda-Karema; and Isaka-Rusumo are expected to cover the distance of 1,342km. Other phases will include Tanga-Musoma (1,108km) and Mtwara-Mbamba Bay (1,000km). In total the SGR network is expected to cover a distance of 4,669km, according to officials from the ministry of Transport and Infrastructure. The construction of the first phase from Dar es Salaam to Mwanza and from Isaka to Rusumo is expected to cost a maximum of $6 billion according to earlier estimates fronted by government officials. It is clear, therefore, that the construction of the whole 4669km network will cost much more.

Tanzania’s decision to go for the SGR is understandable. By its nature SGR is going to revolutionize railway transportation if built in a manner that will link all the important production centres in the country with, not only the ports, but also with most of the neighbouring countries. SGR’s efficiency is unparalleled. An SGR train would move at the speed of 120 kilometres per hour and carry 10,000 tonnes (equivalent to 500 heavy trucks) of cargo at once. The decision to use electricity will add to SGR’s efficiency, an expert says.

Despite the efficiency, the cost of building SGR is too much that it risks bursting Tanzania’s debt to unprecedented levels. Most of the project will be undertaken through loans but the capacity for the government public debt is limited. For the SGR to make sense and ensure quicker return to investment the construction of all these should go concurrently, experts say. Going phase after phase means that the construction of the SGR will take decades. But also to get more benefit to the economy the SGR network should be connected to all neighbouring countries to enable Tanzania to play its useful geographical role as the link between eastern Africa and southern and central Africa. “It is important that Dar es Salaam is linked to Mtwara and Mozambican border by SGR; that SGR should reach Mbeya and, eventually to the Malawian and Zambian borders; Dar es Salaam should be linked to Tanga and the Kenyan border; the SGR should be extended to Musoma and Kenyan border; it is also important that the Isaka-Rusumo section also junctures to Bukoba and Ugandan border,” a railways expert, who asked for anonymity, says. All these connections will enable the exchange of goods from farms, mines, industries and forests both within the region and to the outside world, he added. Burundians, Rwandans, Congolese, Ugandans and Kenyans should be able to access Mozambique, Malawi, Zambia and beyond, and vice versa, using the SGR.

To make this successful a supranational railways organization should be established. This organisation will have to help find financial resources, oversee construction and finally manage the operations of the railway network after construction, the expert says. To ensure sustainability train operations should be left to private companies through the Open Access Operations arrangement or any other similar arrangement, he says.

“Basically railways are different sorts of roads. And they should be treated that way. The way forward is to allow as many private companies as possible to operate trains in routes that will be designated and regulated,” the expert says. The alternative for Tanzania is dire, experts say. Going alone will be too expensive, will result in ballooning of external debt and the construction will take too long for.

Inadequate funding will limit SGR construction to the existing colonial pattern of the central line railway, which doesn’t have enough logistical linkages with the rest of the country, experts say.

“Constructing the SGR following only the colonial pattern of the MGR will be counterproductive for the country in the long run, the expert says. Once you break the colonial railways pattern that we inherited at independence then you break even,” the expert adds.

The MGR is the oldest rail network in the country with its construction starting more than 100 years ago by the German colonial government. When Tanganyika Territory was placed under the British, railway operations were placed under a federal organisation.

This lasted till 1977 when the East African Community collapsed and the Tanzania Railways Corporation was established. The government started to privatize its railway operations. In preparation for this TRC was disbanded and two companies were formed. The Tanzania Railways Limited and a holding company called RAHCO. In March 2006 TRL was privatized to RITES of India for a 25 years deal. The privatization deal did not last long and in July 2011 TRL was returned to the government. In 2017 TRL and RAHCO were, again, merged to form TRC.

Tanzania also has the Cape Gauge railway line that is operated by Tazara, a railway authority jointly owned by Tanzania and Zambia. Tazara’s construction, which started in October 1970 took five years to complete. Now Tanzania has embarked on SGR.