The Tanzania Zambia Railway Authority (TAZARA) Council of Ministers, which is the highest policy organ of the authority, has directed the Board of Directors and Management to work out a framework for incorporating private sector participation in the Authority’s operations and future investment plans.
A press statement issued by the authority yesterday in Dar es Salaam said following the meeting of the Council of Ministers, chaired by Zambian Minister for Transport Yamfwa Mukanga, and his Tanzanian counterpart Dr Harrison Mwakyembe, last week in Dar es Salaam, the Council agreed in principle to proposals by the Board of Directors to engage the private sector in the operations of TAZARA through smart partnerships and open access.
The proposal to engage the private sector was mooted as a way of meeting TAZARA’s critical requirements for both re-capitalisation and working capital.
The Council of Ministers observed that both the Tanzanian and Zambian Governments were increasingly finding it difficult to justify the continued putting of tax-payers’ money into TAZARA, when infact the Authority had the potential to not only be self-sustaining but declaring dividends as well, the statement said .
Earlier, the two Permanent Secretaries responsible for Transport in Zambia and Tanzania, Charity Ngoma and Dr Shabaan Mwinjaka, who are Board Chairperson and Co-Chairpeson respectively, had echoed the Ministers’ thinking and called for management to act.
“We simply cannot continue running the authority in a manner that does not inspire confidence. We have the obligation to turn this institution around and start running it as a business, generating sufficient revenues to meet operational costs and make profits,” Ngoma emphasized during the Board meeting held prior to the meeting of the Council of Ministers.
Dr Mwinjaka concurred with his counterpart’s sentiments, calling on the management of TAZARA to change their mindsets and adopt a different approach to the way of conducting business.
The Acting Managing Director, Eng Ronald Phiri, has since confirmed that the strategic plan that was due to be presented at the Board meeting for consideration would be revisited to accommodate a policy shift that allowed for more visible and active private sector involvement in the operations of the Authority.
“Having been given a free reign to open up and incorporate workable smart partnerships, we are actively revising our five-year strategic plan to look for investment funding elsewhere and possibly invite non-equity private investments through an enhanced integration of private participation in our operations.
“We have not one, but many players who understand the authority well and have expressed very keen interest in working with the Authority. Some of these players have recently supported us in limited ways, but what our superiors have now mandated us to look at in principle is a wider and higher level of private-sector involvement in our operations,” said Eng Phiri.
The Acting Managing Director confirmed that the new five-year strategic plan, together with a new framework for engaging external investments would be ready for presentation to the Board of Directors and Council of Ministers within one month as instructed.
The Council of Ministers is the supreme policy organ of TAZARA, comprising six Ministers, three from each country respectively, namely the Ministries in charge of Transport, Finance and Trade or Commerce.