 INTRODUCTION
 Role of Communications and Transport Sector in Tanzania
Communications and Transport sector plays a very vital role in the day to rough economic development activities. It is one of the pillars in the foundation of the economy whereas investment in this sector has a multiplier effect in the entire economy. It is the major facilitator of the productive, commercial and administrative, information and cultural to the physical supply and distribution of goods and services. As the name suggests these are two separate sectors namely the transport comprising of roads, railway, water and air transport and the communications comprising of telecommunications and postal services. Like blood in animal's body the transport and communications supply inputs and outputs to various parts of the national economy.
CURRENT STATUS OF THE TRANSPORT SECTOR
ROAD TRANSPORT SERVICES:
Freight services
Freight transport service countrywide has been provided mainly by the private sector. Government involvement has been largely through the Regional Transport Companies (RETCOS). Performance of the RETCOS has been falling since 1993/1994 due to liberalisation of the economy. The way forward for the RETCOS is to have private sector to take over the companies. This is being done privatisation process, which is on going.
Passenger Road Transport Services
The private sector has and continues to play a major role in passenger road transport services provision in the country. After deregulation of tariffs, removal of restrictions in importation of vehicles and the absence of entry market barriers the private sector has a full control of the market.
Presently public sector involvement in passenger transport services has been small and confined to the city of Dar es Salaam through the Bus Company UDA:
UDA's performance has been declining since 1998/90 to date. Major causes for the losses have been a sharp drop of the market share (less than 5%) and increased competition from the private operators. The government has restructured UDA and is now due for privatisation.
THE RAILWAY TRANSPORT SERVICES
Tanzania Railways Corporation (TRC)
TRC was established by a Parliament Act of 1977 given the board mandate of conducting business according to commercial principles.
Following a decline in operational performance during the 1980'TRC conceived and implemented a number of major restructuring programmes, which include Emergency recovery programme-ERP, and Railway restructuring programmes RRP.
The Emergency Recovery Programme (ERP) was to arrest the decline of TRC performance. In 1990, the government realised that ERP could stabilise TRC but more needed to be done to improve the TRC performance. In 1991, the government started restructuring the project with the objective of strengthening TRC and eliminate regulatory bottleneck in order to strengthen operations for commercial viability, rehabilitate infrastructure assets, replace on obsolete and for commercial viability, rehabilitate infrastructure assets, replace on obsolete and uneconomic operational assets.
The restructuring process enabled TRC to increase tonnage carried level of 1.36 million tons in 1995 and 1.23 in 1996. TRC is expected to remain with the functions of a land lord body in line with the SATCC Railway Act Model.
Tanzania Zambia Railways Authority (TAZARA)
TAZARA's, 1860 km single-track lines was constructed between 1970 and 1975 and started operation in 1976. The United Republic of Tanzania and the Republic of Zambia jointly own the Railway. It has been moving, 60% of Zambia's import and 70% of its export.
The performance of the railway has been generally declining since 1993. Freight tonnage fell from 935,000 tons in 1993 to 638,000 tons in 1995 and 5599,176 in 1997. Passengers carried have also dropped from 1,938,000 in 1993 to 1,733,000 in 1997. The major reasons for the decline are said to be:
Increased competition from the road mode
A decline in the Zambia and Tanzania national economies thus reducing capacity to export and import.
Increased use of other alternative ports in the Southern Africa region.
The government of Zambia and Tanzania are in consultation to look into the whole question of privatisation of TAZARA which to start with would involve a study to determine how best to approach the process.
MARITIME TRANSPORT AND INLAND WATER WAYS.
Tanzania Harbours Authority (THA)
THA was established in 1977 after the collapse of the East African Community and the subsequent demise of the East African Harbours Authority. Its main functions are developing, improving, maintaining, operating and regulating the harbours and to construct new ports when required. Dar es Salaam is the largest seaport in Tanzania and acts as the coastal terminal for TRC and TAZARA. The ports managed by THA are Tanga, Mtwara, and small ports of Kilwa, Lindi and Mafia. During the Rear 1997/ 98, THA managed to handle about 4,351,845 tons and ships call in 1996/97.
This is about 31% and 2% increase in freight handled and ship calls respectively
Ones of the measures to improve more on THA´s efficiency are to privatise all its operations. Currently the Container Terminal is in the process of being privatised through a concession process. Further, The government under PSRC is looking for a competent Consultant to advise on how other operational units in THA will be privatised.
Tanzania Coastal Shipping Service.
Responsibility for providing Coastal Shipping Services was vested on the Tanzania Coastal Shipping Lines Ltd. but this company has been liquidated. The government is encouraging private sector participation in rendering coastal shipping services.
Inland Water (Lakes) Transport:
Use of Inland Water for transport is mainly on the three big lakes namely, Victoria, Tanganyika and Nyasa. TRC vessels to cover most of the major towns around the lakes render services.
The performance of the Marine division of TRC has been encouraging and for a long time has been making losses. The poor financial performance can be attributed to many factors including revenue leakage, poor staff morale, competition from road and air transport, loss of capacity and passenger arising from the sinking of MV Bokoba and ageing of vessels. For smooth running of Marine services, a decision has been made to privatise the TRC vessels. To facilitate this program, the Marine Division was separated from TRC rail division to form an independent company called Marine services Company Ltd. The company started operating independently with effect from 1st August 1999.
AIR TRANSPORTATION
Civil Aviation
In 1992 the Government liberalised the domestic air transport industry. Air fares and freight tariffs have equally been left to depend on the market force. These reforms have led to the growth of a number of domestic charter operators licensed by the Civil Aviation Board to increase from 15 in 1992 to 26 in 1996 and 4 air transport operators are operating scheduled services in competition with ATC:
Major restructuring measure took place to date enabled the creation of a "Civil Aviation Authority" where it will operate as an autonomous agency on a self financed basis instead of as department of MCT.
Divestiture programme being implemented for the airports has been to start first with the privatisation process of the Kilimanjaro Airport International airport (KIA) on a pilot project basis.
The Government is expected shortly to sign a concession agreement with a newly formed company namely Kilimanjaro Airport Development Company (KADCO). In this firm Government will hold 24% shares. The remaining shares will be owned by private shareholders. Other airports will be divested depending on the outcome of the KADCO venture.
Air Tanzania Corporation (ATC)
The Government in 1977 established ATC after the break up of EAC. From inception and until recently the operational and financial performance of ATC has not been satisfactory. One of the main causes for this has been under- capitalisation.
Although the Government has been injecting capital, this has been in small doses and only when there was a crisis. The other reason was inability to decide on tariff increases or withdrawal of services on unprofitable routes for social and political reason prior to Government approval.
Arising from the Above the Government decided in 1992 to restructure and commercialise ATC including allowing participation of the private sector. Also as part of commercialisation, the Government has given ATC mandate to set and implement its own economic tariff system and withdraw from unprofitable routes. A corporate restructuring took place to match staff with volume of business and work. | As a result of the above measures ATC has and is presently operating commercially and generating profit. Sustaining the improvement is imperative for the successful privatisation of ATC.
On another front the liberalisation of air transportation has placed ATC on competitive arena with private operators.
CURRENT STATUS OF THE COMMUNICATIONS SECTOR
Telecommunications Sector
Following the break-up of the East African Community in 1977, in 1978, the Tanzania Posts and Telecommunications Company (TP&TC) was formed to take over the roles and functions of both the defunct East African Telecommunications Corporation and the East African External Telecommunications Company including Postal Bank services.
The Corporation had developed a telecommunication network, which capitalized on provision of telephone (voice), telex and facsimile services on a fixed wire and radio system. The network generally included public switched lines, leased permanent circuits and privately owned radio utilities.
The performance of the sector was not satisfactory due to the old dilapidated equipment and plants.
The Government realised in early 1990´s that change was required as well as more sources and consolidation. This led to the need for restructuring.
In 1994 Tanzania post and Telecommunication Company was restructured leading to the creation of three entities:
Tanzania Communications Commission (TCC) (the regulator for postal and Telecommunications services)
Tanzania Posts Corporation (TPC), the public postal operator for postal and Telecommunications services.
Tanzania Telecommunications Company Ltd. TTCL, the public telecommunications services operator
Further more, the Government introduced competition in the telecommunications non-basic services (i.e. cellular mobile telecommunications services, data communications, and radiotelephony).
In addition, the National Telecommunications Policy was published in October 1997. The document outlines sector policy objectives and strategies for the period 1997 through 2020. The specific target of the National sector policy is to achieve a telephone density of 6 telephones per 100 population by year 2020.
Parallel to the above-mentioned efforts, a decision to privatise the Tanzania Telecommunications Company (TTCL) has been made and the process is in progress. The goal is to improve the quality and quantity of services provided by way of strategic investor to bring in additional technical know-how, managerial skills and necessary capital.
To date, under liberalization apart from TTCl several private owned companies have also been licensed
-Mobile cellular phones 5 companies i.e. TRI Telecommunication (Tanzania) Limited, MIC Tanzania Limited, VODACOM and also TTCL and ZANTEL; Only 3 of them are operational
-Public data communication, 6 operators
- Radio paging services; several companies
Satellite services and investment opportunities.
In recognising the satellite technological advancement, guidelines for licensing the Global Mobile Personal Communications by Satellite (GMPCS) have been prepared. This will expand the market and use of the satellite system to include domestic customers.
Postal Sector
As explained above in the introduction, TPC was incepted in 1993 following the enactment of the Communications Act 1993. Since then, it has been operational up to date.
The level of Postal Services
In general the level of postal services in the country is not adequate the current infrastructure situation of the public Postal operator stands at 468 Post offices with about 61,000 inhabitants served per post office. The number of private letterboxes installed is 155,456 with 1 box serving persons.
Due to technological advances in the transportation, information and communication sectors population growth and increase in demand for postal services there have been an increasing pressure for more and better services.
The major resource limitations facing the postal sector are:
Inadequate investment capital for modernisation and expansion of the network Insufficient and outdate Postal equipment and technology.
Human resources with deficiency in commercial expertise and experience to operate in a competitive environment.
Steps towards sector service improvement
Sector liberalization
The non-basic postal services have been liberalized. More than 10 courier service operators have been licensed and are operational. In line with this programme, the National Postal Sector Policy is being developed which will further liberalize the sector, provide clear sector policy objectives, vision, targets and investment guidelines.
The public postal operator (TPC)
There has been some improvement with regard to human resource development in improving commercial and business cultural. In terms of services, there is an introduction of modern services.
MAJOR PROJECTS IN THE SECTOR
Since the beginning of the last decade, the transport and communications sector has been implementing a number of reform and infrastructure development programmes with the aim of attaining better performance of the sector. These programmes include sector restructuring and institutional building. The major programmes are as follows:
Telecommunications Restructuring Programme- TRP
The TRP is a comprehensive five-year investment programme, which draws together various donors (IDA, DANIDA, ADB, EU, SIDA, JAPAN and KUWAIT), under one roof. The total investment amounts to US$ 250 MIL. The main objective of the programme is to rehabilitate, modernize and expand Tanzania ´s basic telecommunications network and intended that at the end of the programme the country's teledensity is raised to 0.7 per 100 population from the then 0.3 .The programme has also a package for institutional development. Currently only two projects are yet to be completed.
Railway Restructuring Programme -RRP
The programme entails rehabilitation of the rolling stock (Wagons & Engines) and railway line including bridges for smooth operations of the TRC. The programme currently has 22 projects, 6 of them completed, 13 on going and 3 not yet started. Major financiers are IDA, KFW, EEC, CIDA and TRC:
Port Modernization Programme
The objective of the programme is to improve performance of the Dar es Salaam port. The projects involved include dredging of the port entrance channel, rehabilitation of the oil jet and acquisition of port handling facilities. The programme has successfully been completed. Major financier were IDA, NORAD and JAPAN
MASTERPLAN
Other studies in the transport sector with intention to improve efficiency fall under the Integrated Roads Project (IRP) which has been the largest national project financial assistance from IDA. The three- (3) studies undertaken by the ministry are:
Study on the Establishment of Land transport Commission with an objective to provide a single regulatory body that can consolidate and replace the work of the current lesser regulatory units.
Study on Environment Guidelines
Study on National Transport Sector Strategic Plan and Transport Infrastructure Master Plan Study for Tanzania Mainland.
RELATION WITH WESTERN EUROPE, ASIA AND THE USA
Tanzania is part of the World, thus cannot work in isolation to other nations. It is a member in various regional and International Cooperations and Groupings based on UN governing guidelines. It is our hope that such cooperations will be maintained and strengthened for our benefits. |
