East African Business Week

DAR ES SALAAM, TANZANIA - China has granted a soft loan of US$39.9 m for strengthening the Tanzania and Zambia Railways Authority (TAZARA)
whose performance has drastically gone down.
The loan would be spent on 11 areas including purchase of six new locomotive engines, rehabilitation of nine more and purchase of 90 new cargo carriages and rehabilitation of four cranes and two rescue cranes.
Other requirements are purchase of raw materials for rail underlining bars, purchase of spare parts for 1,200 cargo carriages and covering training costs of workers from different departments and professionals.
The Minister for Transport Omar Nundu revealed this to the National Assembly in Dodoma when tabling his 2011/2012 budget.
He said the loan will help the 1860-km jointly owned ailing railway company to come back to
life. The railway runs from Dar es Salaam on the Indian Ocean coast to Kapiri Mposhi in the heartland of Zambia. It was built by the Chinese aid in the 1970s at a cost of US$500m.
The soft loan will help Tazara manage itself more efficiently.
The Minister said last year - 2010/11 TAZARA made a small improvement of 2.1% by transporting 533,964 tonnes - an average of 44,497 tonnes a month, compared to 522,966 tonnes transported in the 2009/2010 - a monthly  average of 43,580 tonnes.
The railway passenger services also improved by 2.7% by transporting a total of 787,666 passengers in 2010/11, a monthly average of 65,639 passengers, as compared to 767,066 passengers it transported in 2009/2010, which an average of 63,922 passengers a month.
Commenting on the staff boycotts which have plagued TAZARA in recent years, Minister Nundu admitted the situation was caused by poor management.
To overcome this, Nundu said collective measures were taken by the Governments of Tanzania and Zambia aiming at strengthening the railway company.
Nundu said in their agreement China has also waived half of the debt for the construction of the Tazara line the total of which stands $60 million.
In August 2010, the Chinese Government sent a team of experts to study and ascertain challenges and needs of Tazara with a view to improve services.
Tazara communication manager Conrad Simuchile was quoted early this year saying the railway has already received 90 new wagons worth $5 million from China as part of implementation of a bilateral protocol the Asian country signed with Tanzania a few years back.
Last month, when receiving a loan of $250m seven-year deal from a consortium of local and global financiers led by Stanbick Bank Tanzania Limited, Tanzania Finance Minister Mustafa Mkulo said part of the $525m fund will be used to upgrade the development of TAZARA.
The railway, was built between 1970 and 1975 by Chinese to provide landlocked Zambia with a link to the Tanzanian port of Dar es Salaam, following hitches imposed by
the then enemy Rhodesia - Zimbabwe rule- for supporting the independence struggle in that country.