Dar es Salaam Port Expansion: Tanzania’s Feat to Improve Great Lakes Gateway to the World

  • The need for improvements is clear, as demand is steadily increasing. Traffic through the Port of Dar es Salaam has risen over the past five years: between 2011 and 2016 throughput jumped by 3.4 million tonnes annually.

 

By Gordon Feller for FDI Intelligence.  

 

Tanzania is beefing up its major port, the Port of Dar es Salaam, to cut delays and cater to rising demand. Planned improvement works are all the more urgent as ports in nearby South Africa and Kenya are also upgrading, as Gordon Feller reports.

In a bid to expand its share of regional trade, Tanzania is investing billions of shillings into a number of transport projects, including a multi-year upgrade of the country’s principal port, the Port of Dar es Salaam.

The port is a gateway for 90% of Tanzanian trade, as well as the access route to six landlocked countries including Malawi, Zambia, Burundi, Rwanda, Uganda and the eastern part of Democratic Republic of the Congo (DRC). But inefficiencies at the port are costly.

Delays can last up to 20 days for everything from everyday items such as nappies and milk, to emergency medical supplies. A 2014 World Bank report found that these inefficiencies cost Tanzania and neighbouring countries up to $2.8bn in lost revenues annually.

Major overhaul

In July 2017, president John Magufuli unveiled the Dar es Salaam Maritime Gateway Project (DSMGP), which aims to overhaul the Port of Dar es Salaam’s infrastructure by 2023. The project, which the World Bank estimates will cost about $421m, will entail the construction of a new multi-purpose berth at Gerezani Creek, dredging of the port’s entrance channel, and intermodal improvements to both rail and road links.

As a result of the upgrades, the 11-berth port, which handled 13.8 million tonnes of cargo in 2018, is expected to more than double its handling capacity to 28 million tonnes per year by 2020, while berth waiting times will be reduced from 80 hours to 30.

The project is being partly financed by the World Bank, which has provided roughly $350m in loans and grants, while the Tanzania Ports Authority (TPA) is providing the bulk of the remainder, about $70m. The UK’s Department for International Development has also given grant assistance.

The need for the improvements is clear, as demand is steadily increasing. Traffic through the Port of Dar es Salaam has risen over the past five years: between 2011 and 2016 throughput jumped by 3.4 million tonnes annually. Dar es Salaam’s capacity far outstrips that of the country’s next two largest ports, Tanga and Mtwara, which combined handle about 1 million tonnes of traffic annually.

Transformation strategy

The implementation of the DSMGP is key to helping Tanzania achieve the targets of its long-term Development Vision 2025 strategy, aimed at transforming the country into a middle-income and semi-industrialised nation.

Additional projects have also been launched to improve the capacity and efficiency of Tanzania’s biggest port, with the government signing a $154m contract with state-run China Harbour Engineering Company in June to construct a roll-on/roll-off terminal, and deepen and strengthen seven berths.

There have also been other programmes aimed at reducing bottlenecks, including the 2014 launch of the Tanzania Customs Integrated System, an automated customs processing system that has reduced import clearance times from nine days to less than one, and the prime minister’s directive in May 2018 to ensure 24/7 operations at the port, which is helping to reduce dwell times.

However, several other major facilities on the Indian Ocean, including South Africa’s Durban and Kenya’s Mombasa ports – both of which cater to neighbouring markets – are also undergoing expansion programmes. This makes the urgency of Tanzania’s maritime investments all the more crucial.

As a result, the TPA is also looking to improve infrastructure further inland. It has announced plans to build a dry port in the country’s western Kigoma region. Located by Lake Tanganyika, the facility will serve the Great Lakes region, including Uganda, Burundi, Rwanda, the DRC and Zambia, and will be linked to the Port of Dar es Salaam by a new 2500-kilometre standard-gauge railway.

New freight rail project aims to improve transport links in country

The first phase of the rail link, a 205-km stretch between Dar es Salaam and Morogoro, is scheduled for completion by October 2019. Turkey’s Yapı Merkezi and Portugal’s Mota-Engil are constructing the first phase of the project. The line will carry an estimated 17m tonnes of freight per year, and will include a stop at the dry port at Ruvu in the south-east of the country.  Source (Text): FDI Intelligence.