TAZARA, the Tanzanian-Zambia Railway owner, has lured a staggering $1.4 billion investment in the form of a Public-Private Partnership (PPP) agreement between it and China Civil Engineering Construction Corporation (CCECC). The landmark agreement will upgrade the railway to world-class infrastructure and operations for maximum long-term efficiency and sustainability.
The 30-year agreement schedules a phased rehabilitation and modernization of the railway network. The initial three years will go into track rehabilitation, reconditioning of the locomotives and wagon sets, and overhauling of the overall modus operandi of the railway by CCECC. The remaining 27 years will be utilized in massive operations and maintenance work in the custody of CCECC, maintaining the railway in mint condition.
The refurbishment of the railway track infrastructure will account for most of the investment, about $1 billion. This will involve significant maintenance and improvements to enhance capacity, safety, and efficiency. The purchase of 762 wagons and 32 new locomotives, which will significantly boost freight and passenger transport, will cost an additional $400 million.
TAZARA, constructed during the 1970s using Chinese assistance, has suffered operational issues due to years of underfinancing and mismanagement. The Tanzania-Zambia railway linking Tanzania’s port at Dar es Salaam to Kapiri Mposhi in Zambia is an economic lifeblood transport artery to both countries. It is an intra-regional trade lifeline carrying commodities and goods between Tanzania, Zambia, and other countries in the region. Through the upgrading of the railway, this deal will initiate economic activity in the Dar es Salaam corridor, reduce the transport cost, and provide a more productive means of transport than road transport. With the projected increase in tons per year from the current 500,000 metric tonnes to about two million metric tonnes, the project will enhance trade and industrialization in the area.
The PPP deal will make sure that the private investor, CCECC, and the governments of Tanzania and Zambia will be compensated for the investment. As per the agreement, CCECC will develop, operate, and maintain the railway and receive revenues from freight and passenger operations during the concession period. Through construction and operation, the project will generate a chance to employ thousands of individuals and offer employment opportunities to local workers, engineers, and technicians. TAZARA rehabilitation will also stimulate other industries such as manufacturing, mining, and agriculture through the provision of an uninterrupted transport system.
The $1.4 billion PPP deal between TAZARA and CCECC is a significant step towards the recapture of the railroad and bolstering regional trade. Enhanced infrastructure with improved facilities, increased transport capacity, and the best management approach position TAZARA to take a leadership role in the transport and logistics sector of East and Southern Africa. As the project advances, its stakeholders look ahead to provide better economic prosperity and sustainable growth to Tanzania, Zambia, and the region at large.
