CORRIDOR DIAGNOSTIC STUDY OF THE NORTHERN AND

CENTRAL CORRIDORS OF EAST AFRICA

ACTION PLAN

Volume 1: Main Report

SUBMITTED TO
Task Coordination Group (TCG)
Chaired by East African Community
(EAC)
Alloys Mutabingwa
Deputy Secretary General Planning and
Infrastructure
Arusha, Tanzania

SUBMITTED BY
Nathan Associates Inc.
Arlington, Virginia, USA

April 15, 2011

USAID Contract No. EEM‐I‐00‐07‐00009‐00, Order No. 2

with funding provided by USAID and DFID
Contents
Volume 1: Main Report
Executive Summary

1. Introduction 1

Background 1

Goals of the Study 1

Geographic Scope of Study 2

Collaboration with Other Regional Transport Studies 3

2. Northern Corridor Infrastructure and Performance 5

Infrastructure and Conditions 5

Mombasa Port 6
Road System 11
Rail System 13
Lake Transport 15
Border Crossings 15
Corridor Performance by Component 16

Ports 17
ICD Imports (Domestic CFS) 18
Border Post 18
Road 19
Rail 19
Overview of Northern Corridor Performance 20

Imports 20
Exports 22
Cost and Time Comparison by Transport Alternatives 23

Imports 23
Exports 25
Interpretation of Results 28
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Port of Mombasa 28
Land Transport 28
Other Causes of Inefficiency 29

3. Central Corridor Infrastructure and Performance 30

Infrastructure and Conditions 30

Port of Dar es Salaam 31

Road System 35
Rail System 37
Lake Transport 38
Border Crossings 40
Corridor Performance by Component 41

Ports 43
Border Post 43
Road 44
Rail 44
Overview of Central Corridor Performance 45

Imports 45
Exports 46
Cost and Time Comparison by Transport Alternative and Component 48

Imports 48
Exports 50
Interpretation of Results 52

Dar es Salaam Port Performance 52

Other Causes of Inefficiency 54

4. Comparative Corridor Performance and Future Requirements 55

Comparative Analysis 55

Imports 55
Exports 57
Comparisons of Northern and Central Corridor Performance to Other
African and Asian Corridors 58
Trade and Traffic Forecasts 59

Trends in East African Trade Flows 60

Current Northern and Central Corridor Traffic 62
Regional GDP Growth 64
Forecast of East African Trade 64
Forecast of Northern and Central Corridor Traffic 65
Implications for Corridor Infrastructure 68
Alternative Trade and Traffic Scenarios 68
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Low GDP Growth Scenario 68

5. Strategies for Improving Corridor Performance 73

Maritime Ports 73

Container Operations 73
Dry Bulk and General Cargo 75
Liquid Bulk 75
Lake Ports 76

Barge Feeder Services on Lake Tanganyika 76

Barge Feeder Services on Lake Victoria 76
Rail 77

Revitalization Strategy for TRL 78

Revitalization Strategy for RVR 79
Roads 80

Road Infrastructure 80
Improved Vehicle Overload Control System 80
Border Posts and Trade Facilitation 82

Approach to Improving Facilitation and Priority Initiatives 82

General Implementation Issues 83
Role of Competition 85

Infrastructure Financing through PPPs 87

Leadership by NCTTCA and CCTTFA 90

6. Proposed Northern Corridor Projects 93

Mombasa Port 93

Mombasa New Container Terminal – Kipevu West 95

Enhancing Port Operation with ICT Applications (TA) 96
Mombasa New Petroleum Facility 97
Mombasa Dry Bulk Facilities Development 97
Lamu Port and Corridor 98
Lake Ports and Transport 99

Rail 99

RVR Infrastructure Upgrade: 1–3 years 100

RVR Infrastructure Upgrade: 3–5 years 101
Reconstruction of the Tororo – Gulu – Pakwach Railway 102
RVR Locomotive Rehabilitation: 1–3 years 103
RVR Kampala ICD Development 104
RVR Mombasa Intermodal Yard and Equipment 104
Establish Regional Railway Safety Regulator (TA) 105
Roads 106
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Capacity Upgrades 107

Road Rehabilitation Projects 109
Upgrading to Paved Roads 110
Develop Road Maintenance Contracting System for Northern Corridor
(TA) 111
Leadership by NCTTCA (TA) 112

7. Proposed Projects for Improving Central Corridor Performance 114

Dar Es Salaam Port 114

Dar es Salaam Short-term Container Handling Capacity Enhancement

with ICDs 115
Dar es Salaam Container Terminal (Berths 13 and 14) 116
Enhancing Port Operation with ICT Applications (TA) 116
Dar es Salaam Single Point Mooring (SPM) 117
Conversion of Selected General Cargo Facilities to Dry Bulk 118
New Road Access to Dar es Salaam Port 119
Rail 120

Procure and Retain TRL Management Team (TA) 120

Tanzania Railways Ltd. Revival – Infrastructure Rolling Stock and
Working Capital 121
Dar es Salaam Cargo Freight Station (Kisarawe) 124
TRL Track Infrastructure Upgrade: 3 - 5 years 125
Roads 126

Capacity Upgrades 127

Road Rehabilitation Projects 128
Upgrading to Paved Roads 129
Develop Road Maintenance Contracting System for Central Corridor (TA) 130
Lake Ports 131

Lake Ports Rehabilitation, Dredging and Siltation Protection 131

Establish RoRo Services on Lakes Tanganyika and Victoria 132
Restructure Wagon Ferries to Carry MAFI Trailers 133
Develop Vessel Maintenance Capacity on Lake Tanganyika (TA) 134
Enhance Safe Navigation (TA) 134
Leadership by CCTTFA (TA) 135

8. Border Posts and Trade/ Transport Facilitation 137

Border Post Investment Programs 137

Implementing Border Post Improvements and/or OSBP 141

Regional and Corridor Institutional Role in Implementation 143
OSBP Implementation 143
Streamlining Customs Clearances at Border and Inland 144
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Trade and Transport Facilitation 146

Reduce Informal Stops and Payments on Corridors 146

Liberalize Transit Requirements 147
Improved Vehicle Overload Control System 148
Maximize EAC Customs Union Implementation Benefits 149
Implement Effective Transit Regime 150
Policies and Agreements 152

Integration of National and Regional Transport Policies 152

Harmonize Road Transport Policy 153

9. Funding Requirements and Impact Assessment 157

Funding Requirements 157

Impact of Proposed Projects 159

Northern Corridor 159

Central Corridor 161
Overall Transport Cost Savings 162
Impact on Trade Flows 163
Worst Case Scenario 165

10. Prioritized Projects for Action Plan and Summary 167

Criteria for Prioritizing Projects 167

Action Plan 168

CDS Findings and Conclusions 170

Traffic Forecast 170

Corridor Performance 171
Strategies for Improvement 172
Potential Impact on Performance 172
Longer-Term Needs 173

Appendix A. Project Profiles

Volume 2: Technical Papers

A. Goals, Approach and Methodology
B. Trade and Traffic Forecast
C. Corridor Diagnostic Audit
D. Regulatory Framework and Transport Policy
E. Integration of Maritime Ports with Inland Container Depots
F. Lake Transport
G. Rail Revitalization
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Illustrations

FIGURES
Figure 1-1 CDS Geographic Scope 3
Figure 2-1 Northern Corridor Network 6
Figure 2-2 Mombasa Port Traffic Composition by Commodity, 2009 8
Figure 2-3 Mombasa Port Transit Traffic, 2009 8
Figure 2-4 Current Layout of Mombasa Port 9
Figure 2-5 Characteristics of the Northern Corridor Road Network 12
Figure 2-6 Condition of Northern Corridors Roads 13
Figure 2-7 Northern and Central Corridor Rail Systems 14
Figure 2-8 Gisenyi/Goma Border Crossing 15
Figure 2-9 Links and Nodes Schematics of the Northern Corridor 17
Figure 2-10 Cost and Time for Northern Corridor Destinations Served by Road and
Rail Transport, Imports, 2010 (light containers) 24
Figure 2-11 Cost and Time for Northern Corridor Destinations Served Only by Road
Transport, Imports, 2010 (light containers) 25
Figure 2-12 Cost and Time for Northern Corridor Origins Served by Road and Rail
Transport Alternatives, Exports, 2010 (light containers) 26
Figure 2-13 Cost and Time for Selected Northern Corridor Origins Served by Road
Transport - Exports, 2010 (light containers) 27
Figure 3-1 Central Corridor Network 31
Figure 3-2 Layout of Dar es Salaam Port 32
Figure 3-3 Dar Es Salaam Traffic by Cargo Type, 2009 33
Figure 3-4 Transit Traffic Distribution, 2009 33
Figure 3-5 Characteristics of the Central Corridor Road Network 36
Figure 3-6 Condition of Central Corridors Roads 37
Figure 3-7 Central and Northern Corridor Rail Systems 38
Figure 3-8 Links and Nodes of the Central Corridor 42
Figure 3-9 Cost and Time for Central Corridor Destinations Served by Road and
Rail/ Lake Transport Alternatives, 2010 (light containers) 48
Figure 3-10 Cost and Time for Central Corridor Destinations Served by Single
Transport Alternatives Road or Rail/ Lake, 2010 (light containers) 50
Figure 3-11 Cost and Time for Central Corridor Origins Served by Road, 2010 (light
containers) 50
Figure 3-12 Cost and Time for Central Corridor Origins served by a Single Transport
Alternative, 2010 (light containers) 52
Figure 4-1 Comparison of Fastpath Logistics Scores by Corridor and Segment 59
Figure 4-2 Distribution of East Africa Exports and Imports, 2008 60
Figure 4-3 Average Annual Growth of Imports and Exports by Country 2005-2009 62
Figure 4-4 Share of Transit Traffic by Corridor, 2009 (percent) 63
Figure 4-5 Average Annual GDP Growth Used in the CDS Forecast, 2009-2030 64
Figure 4-6 Average Annual Trade Growth by Country, 2009-2015 and 2015-2030 65
Figure 4-7 Forecast of Northern and Central Corridor Traffic by Type, 2009-2030 (mt) 67
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Figure 4-8 Comparison of Average Annual Trade Growth by Country, Base Case vs.
Low Growth 2009-2015 69
Figure 4-9 Comparison of Average Annual Trade Growth by Country Base Case vs.
Low Growth 2015-2030 70
Figure 4-10 Comparison of Traffic in Northern and Central Corridors- Base Case vs. Low
GDP Growth Scenarios, 2015 and 2030 72
Figure 5-1 Use of Tractor for Container Transfers 74
Figure 5-2 Mombasa Bulk Facilities (Cement and Flourspar) 75
Figure 5-3 Cargo Handling at Lake Port 77
Figure 5-4 Improved Corridor Road to Four Lanes and Divided Highway 80
Figure 6-1 Port of Mombasa Long term Port Master Plan Proposals 94
Figure 6-2 RVR Locomotive and Train Set 103
Figure 6-3 RVR Derailment 106
Figure 6-4 Road Construction Activity 107
Figure 6-5 Proposed Northern Corridor Road Capacity Upgrade Projects 108
Figure 6-6 Northern Corridor Road Rehabilitation and Upgrading to Paved Projects
by Type and Timing 110
Figure 7-1 Port of Dar es Salaam Master Plan 115
Figure 7-2 Proposed Site for Kisarawe ICD 125
Figure 7-3 Proposed Central Corridor Road Capacity Upgrade Projects 127
Figure 7-4 Central Corridor Road Rehabilitation and Upgrading to Paved Projects by
Type and Timing 128
Figure 7-5 Wagon-Ferry Ramp at Port Bell 133
Figure 8-1 Straddle OSBP at Nemba 141
Figure 8-2 Rusumo Border Post 144
Figure 8-3 Malaba Border Posts Transactions 145
Figure 8-4 Police Stops on Corridor 146
Figure 8-5 Required Transit Goods Sign 147
Figure 8-6 Border Post Queuing at Malaba 150
Figure 9-1 Comparison of Traffic Forecast inBase Case vs. Worst Case Scenario, 2015
and 2030 166

TABLES
Table 2-1 Mombasa Port Traffic, 2002-2009 7
Table 2-2 Characteristics of Mombasa Port 10
Table 2-3 Mombasa Port Container Traffic, 2003–2009 11
Table 2-4 Condition of Northern Corridor Railways Tracks 14
Table 2-5 Port Input for the Import and Export of Transit 20 ft Light Containers 18
Table 2-6 Nairobi ICD Input for 20ft Light Containers 18
Table 2-7 Border Post Input for 20ft Light Containers 19
Table 2-8 Road Input for 20ft Light Containers 19
Table 2-9 Rail Input for 20ft Light Containers 20
Table 2-10 Northern Corridor Performance for Imports by Cargo Type and
Destination, 2010 (via road) 21
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Table 2-11 Northern Corridor Performance for Imports by Cargo Type and
Destination, 2010 (via rail) 22
Table 2-12 Northern Corridor Performance for Exports by Cargo Type and Origin,
2010 (via road) 22
Table 2-13 Northern Corridor Performance for Exports by Cargo Type and Origin,
2010 (via rail) 23
Table 2-14 Mombasa Port Performance (light containers) 28
Table 3-1 Dar Es Salaam Port Traffic 32
Table 3-2 Characteristics of the Dar es Salaam Port 34
Table 3-3 Dar es Salaam Container Traffic 2000-2009 35
Table 3-4 Port Input for the Import and Export of Transit 20 ft Light Containers 43
Table 3-5 Border Post Input for 20ft Light Containers 44
Table 3-6 Road Input for 20ft Light Containers 44
Table 3-7 Rail Input for 20ft Light Containers 45
Table 3-8 Central Corridor Performance for Imports by Cargo Type and Destination,
2010 (via road) 45
Table 3-9 Central Corridor Performance for Imports by Cargo Type and Destination
(via rail or rail and lake) 46
Table 3-10 Central Corridor Performance for Exports by Cargo Type and Origin (via
road) 47
Table 3-11 Central Corridor Performance for Exports by Cargo Type and Origin (via
rail or rail / lake) 47
Table 3-12 Dar es Salaam Port Performance (light containers) 53
Table 4-1 Performance Comparison of Destinations Served by Both the Northern and
Central Corridors, 2010 (imports) 56
Table 4-2 Performance Comparison of Origins Served by Both Northern and Central
Corridors, 2010 (exports) 57
Table 4-3 Transit Traffic of Landlocked Countries, 2005-2009 61
Table 4-4 Northern and Central Corridor Traffic by Type and Mode, 2009 63
Table 4-5 Forecast of Northern and Central Corridor Traffic by Type and Mode 2015 66
Table 4-6 Forecast of Northern and Central Corridor Traffic by Type and Mode, 2030 66
Table 4-7 Low GDP Growth Traffic by Corridor and Mode, 2015 71
Table 4-8 Low GDP Growth Traffic by Corridor and Mode, 2030 71
Table 5-1 Commitment of OSBP Components for Priority Borders 84
Table 6-1 Proposed Infrastructure Projects for Mombasa Port 93
Table 6-2 Proposed Northern Corridor Rail Projects 100
Table 6-3 Proposed Northern Corridor Road Projects 107
Table 6-4 Proposed Northern Corridor Road Capacity Upgrade Projects 109
Table 6-5 Proposed Northern Corridor Road Rehabilitation Projects 110
Table 6-6 Proposed Northern Corridor Road Projects Upgrading to Paved Condition 111
Table 7-1 Proposed Projects for Dar es Salaam Port 114
Table 7-2 Proposed Central Corridor Rail Projects 120
Table 7-3 Proposed Central Corridor Road Projects 127
Table 7-4 Proposed Central Corridor Road Capacity Upgrade Projects 128
Table 7-5 Proposed Central Corridor Road Rehabilitation Projects 129
Table 7-6 Proposed Central Corridor Road Projects Upgrading to Paved Condition 130
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Table 7-7 Proposed Lake Transport Projects 131

Table 8-1 Main Border Posts and their Characteristics 138
Table 9-1 Proposed Infrastructure Projects by Mode 158
Table 9-2 Proposed Operations Projects by Sector 159
Table 9-3 Improvement in Northern Corridor Performance for Imports with
Proposed Action Plan Projects, 2015 (light containers) 160
Table 9-4 Improvement in Northern Corridor Performance for Exports with
Proposed Action Plan Projects, 2015 (light containers) 161
Table 9-5 Improvement in Central Corridor Performance for Imports with Proposed
Action Plan Projects, 2015 (light containers) 161
Table 9-6 Improvement in Central Corridor Performance for Exports with Proposed
Action Plan Projects, 2015 (light containers) 162
Table 9-7 Annual Transport Cost Savings from Proposed Corridor Improvement
Projects, 2015 163
Table 9-8 Potential for Traffic Increases due to Improved Corridor Performance, 2015 164
Table 9-9 Potential for Traffic Increases due to Improved Corridor Performance, 2030 164
Table 9-10 Worst Case Scenario Traffic by Corridor and Mode 2015 (000 tons) 165
Table 9-11 Worst Case Scenario Traffic by Corridor and Mode 2030 (000 tons) 166
Table 10-1 Prioritized Infrastructure Projects for the Action Plan 168
Table 10-2 Prioritized Action Plan Operations Projects 170
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Executive Summary
CDS ORIGIN AND OBJECTIVE
The Northern Corridor, anchored by the port of Mombasa in Kenya, and the Central
Corridor, anchored by the port of Dar es Salaam in Tanzania, are the principal transport
routes for national, regional, and international trade of the five East African Community
(EAC) countries—Burundi, Kenya, Rwanda, Tanzania, and Uganda. Because of
inadequate physical infrastructure and inefficiency, these corridors are characterized by
long transit times and high cost. Freight costs per km are more than 50 percent higher
than costs in the United States and Europe, and for the landlocked countries, transport
costs can be as high as 75 percent of the value of exports.

The East Africa Corridor Diagnostic Study for Northern and Central corridors has been
undertaken as a response to the Tripartite (COMESA, EAC and SADC) and EAC regional
leadership and peoples demand for an in depth assessment of the performance of the
corridors and preparation of an action plan to remove identified transport logistics
impediments. The ultimate objective is to develop an efficient regional transport system
that will reduce the prohibitively high transport costs and, thus, catalyze and facilitate
trade expansion and investment, which form the cornerstone for economic growth and
regional prosperity.

STUDY APPROACH
Based on the emphasis not to duplicate past and ongoing efforts and initiatives similar to
CDS, existing studies reports and documents were collected and reviewed. A total of 250
such documents reviewed have been stored on www.eastafricancorridors.org for
reference.

A database of 136 ongoing related projects being implemented by Governments and

Developing Partners in transport infrastructure was established and has been saved on a
web based GIS map on www.eastafricancorridors.org. It requires periodic updates to
form a mechanism for coordination and avoiding wasteful duplication.

In the detailed CDS FastPath assessment of the performance of the Northern and Central
Corridors, integrity of data on cost, time and reliability was assured by an extensive
interviews with all key stakeholders including Shippers (traders, manufacturers and
retailers), Transport service providers (ports, shipping lines, inland container depots,
truckers, railways), Freight forwarders ( clearing agents, insurance companies) and
Government ministries and agencies (transport ministries, Customs, regulators). A total
235 interviews were conducted with institutions of various sizes, by type of commodities
handled and gender.
 xii

To further ensure coordination as directed by sponsors, four firms responsible for key
related studies being implemented concurrent with the CDS shared data, information,
and analytical findings to make the most effective use of study resources and enhance the
studies’ quality and consistency. The collaborating consultants are Nathan Associates
(responsible for CDS and Definition and Investment Strategy for a Core Strategic Network
for Eastern and Southern Africa conducted for the World Bank), Aurecon (responsible for
EAC Transport Strategy and Road Sector Development Program conducted for the EAC),
Louis Berger International (responsible for Northern Corridor Infrastructure Master Plan
conducted for the NCTTCA) and CPCS Transcom Limited (responsible for Northern
Corridor Analytical Comparative Transport Cost Study conducted for the NCTTCA).

CDS has been highly consultative, partly to secure as much information as possible but
also importantly to engender ownership by regional stakeholders. Apart from the
foretasted 235 interviews, interactions with stakeholders were also through (i) a first
regional stakeholders workshop held in February 2010 in Arusha with 96 participants, (ii)
country validation workshops and roundtable meetings, with a total of 143 participants,
(iii) Task Coordination meeting held in Arusha in January 2011 with 40 participants, and
(iv) a second and final regional stakeholders workshop to be held in Dar es Salaam in
February 2011 with an expected 200 participants.

In order to achieve effective communication of CDS and its recommendations, a series of

educational films are being produced. The most important communications products are
a 15 minutes curtain raiser on the EA corridors, a 5-minute investor film, two 5-minute
corridor specific films and a 7-minute film on the making of CDS. The website is also an
important communications tool accommodating several products.

TRAFFIC FORECAST
The traffic forecast for the Northern and Central Corridors will overwhelm the existing
infrastructure and will obviously require substantial investments throughout the forecast
period. Traffic growth implies large future demand on ports (24 million tons by 2015 and
117 million tons by 2030), highways (80 percent more traffic by 2015 and 4 times more
traffic by 2030), rail (6.5 million tons in 2015 and 17.7miliion tons by 2030).

If capacity is not increased, congestion at ports and on rail and roads will reach epic
levels and constrain economic growth. Therefore there is a clear need for substantial and
targeted investment in regional transport infrastructure now and continuing for the next
several decades

CORRIDOR PERFORMANCE ASSESSMENT

The two corridors are performing at a level that that generally corresponds to “fair” based
on comparisons with other international corridors. Observations include:

• Berth and yard congestion and the lack of customs clearance coordination contribute
to excessive dwell time of up to 9 days in Mombasa and 12 days in Dar es Salaam.
 xiii

• Road transport costs are high due to lack of backhauls and poor road conditions. On
the Northern Corridor, high informal payments are a significant component of total
costs.

• Multimodal services such as rail plus lake were formerly highly utilized; and still
preferred by shippers. Multimodal shipments can take longer time than road but can
have a lower cost.

• Rail service, while improving is still unreliable service especially at transfer points
and locomotive exchange points. Rail rates are not necessarily cost based but are
priced just below road transport as rail does not have current surplus capacity.

• Lack of risk management result in longer delays at border crossings. There are still
long inland clearance times in Kigali, Goma and Bujumbura.

• Land transport (road or rail) represents the most significant element from the price
point of view (50-80 percent of total cost) while the port represents 60-80 percent of
total time.

• Extra inventory costs due to delays and inefficiencies in the corridors have a
significant impact on the total costs of the goods, accounting for 10-25 percent of the
total logistics cost.

• In Kenya, vehicles licensed for transit cannot carry domestic cargo and must use
prescribed transit routes. This has the effect of many return trips being empty.
Similarly in Tanzania, the Revenue Authority licenses trucks for transit or domestic
with the same effect.

• Existing overloading control strategy is aimed at achieving 100 percent inspection of

all commercial vehicles. Targeted risk management approaches and incentive to
encourage truckers to self-regulate need to be implemented.

STRATEGIES FOR IMPROVEMENT

Improving the efficiency and reliability of the Northern and Central Corridors will require
the adoption and implementation of an integrated Action Plan to simultaneously address
infrastructure constraints and bottlenecks and operational inefficiencies, policies and
procedures.

• As the gateways for the two corridors, the ports of Mombasa and Dar es Salaam must
have adequate capacity and be able to perform efficiently in order for the overall
corridor performance to improve.

• An optimized port / ICD integration program is proposed as a short-term solution to

alleviate such capacity constraints; by transferring cargo handling at the marine
terminals container yards to near port ICDs.
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• Both ports have master plans defining long-term development projects, including
new container terminals, which would ease capacity constraints and increase berth
productivity considerably. These should be developed on an accelerated basis.

• Projects to increase capacity for liquid and dry bulk products at the two ports should
be implemented as planned.

• The regional railways will have to increase their freight volumes substantially in
order to become viable. The regional railways will need to target the container sector
in order to achieve the threshold volumes – this will lead to increased competition
with road. Focusing on bulk traffic will in most instances not be enough.

• Road improvements projects are a central component of the improvement strategy

and must be conducted for three categories of roads: (i) upgrade road capacity by
adding lanes to roads with heavily traffic; (ii) rehabilitation of paved roads whose
poor condition affect corridor performance; and (iii) upgrade from gravel to paved
standards key feeder roads that serve the corridors.

• Implement a series of technical assistance interventions designed to improve

transport operations and policies and to ensure that the benefits of the proposed
infrastructure investments are realized.

FUNDING REQUIREMENTS
The transport infrastructure projects that have been proposed for consideration in the
Action Plan have a total cost of US$ 4.2 billion. (Table ES-1). It is anticipated that 22 of the
28 projects could be implemented under a PPP arrangement with varying degrees of
private sector participation. Of these projects in the Central Corridor have a total cost of
US$ 2.1 billion and the Northern Corridor US$ 2.1 billion. A summarized description of
each of the proposed CDS Action Plan infrastructure projects is presented in Table ES-3 at
the end of this Executive Summary. Further details are provided in the project profiles
presented in Appendix A.
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Table ES-1
Proposed Infrastructure Projects by Mode
Cost Estimated Impact on Peformance
Name (US$ Corr. EIRR PPP
mil.) Price Time Reliability (%) Potential
Port Projects
Mombasa Short-term Container Handling Capacity
Enhancement with ICDs 35.0 NC -4 -13 -23 165 Yes
Dar es Salaam Short-term Container Handling 26.0
Capacity Enhancement with ICDs CC -2 -16 -7 226 Yes
Mombasa New Container Terminal – Kipevu West 342.5 NC -3 -11 -23 37 Yes
Dar es Salaam Container Terminal (Berth 13 &14) 500.0 CC -1 -15 -7 35 Yes
Mombasa New Petroleum Facility 55.8 NC -5 -12 -13 35 Yes
Mombasa Dry Bulk and General Cargo Facilities 1.7 NC -3 -6 -10 25 Yes
Dar es Salaam Dry Bulk and Break Bulk Facilities 5.0 CC -2 -5 -8 25 Yes
Dar es Salaam Single Point Mooring 68.5 CC -5 -12 -13 35 Yes
Lamu Corridor New Port and Associated Infrastructure
7.0 NC n.a. n.a. n.a. 30 Yes
Subtotal 1,041.5

Rail Projects
TRL Revival Infrastructure, Rolling Stock and Working
Capital and Isaka ICD 185.0 CC -15 -11 -19 38 No
TRL Track Infrastructure Upgrade 3-5 years 350.0 CC -4 -3 -5 27 Yes
RVR Infrastructure Upgrade 1 - 3 years 250.0 NC -2 -6 -9 22 Yes
RVR Locomotive Rehabilitation -3 years 20.0 NC -4 -11 -15 22 Yes
RVR Infrastructure Upgrade 3 - 5 years 150.0 NC -2 -5 -6 22 Yes
RVR Mombasa Intermodal Yard and Equipment 20.0 NC -1 -2 -3 26 Yes
RVR Kampala ICD Development 10.0 NC -1 -2 -3 21 Yes
Reconstruction of Tororo-Gulu- Pachwach Railway 325.0 NC n.a. n.a. n.a. 24 Yes
Dar es Salaam CFS Site Selection Design and Project
Preparation (Kisarawe) 2.0 CC -1 -1 -1 n.a. Yes
Subtotal 1,312.0

Road Projects
Central Corridor Capacity Upgrades 61.7 CC -1 -2 -2 n.a. No
Central Corridor Road Rehabilitation 331.0 CC -2 -3 -1 n.a. No
Central Corridor Upgrade to Paved 543.8 CC -3 -6 -1 n.a. No
Northern Corridor Capacity Upgrades 234.5 NC -2 -3 -6 n.a. No
Northern Corridor Road Rehabilitation 362.9 NC -10 -8 -7 n.a. No
Northern Corridor Upgrade to Paved 143.7 NC -5 -7 -3 n.a. No
Subtotal 1,677.6

Lake Transport Projects

Lake Ports Rehabilitation, Dredging and Siltation
Protection 14.0 CC -2 -2 -8 34 No
Provision of RoRo Services on Lakes Tanganyika and 15.4
Victoria CC -1 -1 -5 28 Yes
Restructuring Wagon Ferries to Carry MAFI Trailers 7.0 CC -1 -1 -2 28 Yes
Subtotal 36.4

Transit Facilitation Projects

Design and Construction of One Stop Border Posts 110.0 Both -1 -1 -1 22 Yes

Total All Infrastructure Projects 4,177.5

Source: Prepared by Nathan Associates Inc.

POTENTIAL IMPACT ON PERFORMANCE

The implementation of the proposed Action Plan projects can have a substantial impact
on the performance of the Northern Corridor and Central Corridors.
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• Overall, annual transport cost savings from implementation of the proposed projects
by 2015 are estimated at US$ 1.9 billion, corresponding to an average reduction in
transport costs of 28 percent. Due to the larger volumes and longer average distances,
the Northern Corridor accounts for about three-quarters of the total transport cost
savings with cost reduction of US$ 1.4 billion. The Central Corridor has annual
transport cost savings of US$ 0.4 billion by 2015.

• Generally, the price to serve Northern Corridor destinations by road can be decreased
by 25 percent and those destination served by rail by 11-14 percent. In terms of time,
the destinations served by rail can generate an average reduction of 53 percent in
shipment time, while destinations served by road have a reduction in time ranging
from 21-33 percent.

• On the Central Corridor the reduction in price for destinations served by road are
generally between 9-11 percent, while destinations served by rail or rail/ lake are
estimated to have reduction in price between 30-36 percent. The percent reduction in
time is generally in the range of 40-50 percent.

WORST CASE SCENARIO

An alternative scenario was considered to assess the impact on projected corridor traffic if
the proposed corridor improvements were not implemented. A “Worst Case Scenario” is
evaluated, where it is assumed that none of the proposed projects are implemented and
consequently corridor performance deteriorates as traffic volumes increase and the
transport network gets increasingly congested. As increasing traffic challenges capacity
leading to congestion; transport costs increase along with deteriorating quality of service
along the corridor. Due to the deteriorating corridor performance, the forecast of traffic
demand assumed for the Base Case Scenario will not materialize. This is due to the
reduced competitiveness of the region’s exports and the increased cost of imports. Also
investment in new or expanded production facilities would be discouraged. Accordingly,
this scenario would have a lower GDP growth than the Base Case. For the Worst Case
Scenario we have assumed a worsening corridor performance in terms of a 25 percent
increase in price, time as well as a 25 percent decrease in reliability coupled with the Low
GDP Growth Scenario that assumed a 40 percent reduction of the Base Case Scenario
annual GDP growth rate per country.

PPP POTENTIAL
The CDS report discusses the elements that ideally should be in place to foster a vibrant
and growing role for the private sector to invest in what has traditionally been considered
public infrastructure. However, even though there are efforts to establish this PPP
framework, the region cannot wait for the complete framework to be developed, adopted
and implemented before attracting private sector funding for critical infrastructure needs.
In the absence of a comprehensive PPP framework, international and regional experience
has shown that specific projects can be implemented under legal contractual
arrangements and can mobilize sizable levels of private sector investment. Within the
 xvii

region, examples of Citadel in RVR, TICTS in Dar es Salaam Port and KLM in Kenya
Airways are important models to consider.

In assessing the PPP potential of the propose projects, international and regional
experience of the types of projects that have proven to be most amenable to attract private
sector financing was taken into consideration. For example, many of the proposed port
projects can generate sufficient cash and foreign exchange to meet debt service
requirements. The railway investments if combined with a sensible business plan and
strong management can attract private investment. Road projects with significant traffic
may be the most suitable to attract private investment as toll roads or under a shadow toll
arrangement in which the governments contribute revenues based on traffic volumes.

CRITERIA FOR PRIORITIZING PROJECTS

In an ideal world the entire program of proposed infrastructure and operational projects
would be funded immediately. However, funding realities demand that some projects be
prioritized and others postponed. The CDS has identified a subset of projects within the
Action Plan to be prioritized first in case of financial limitations. Three criteria were used
to select these projects. Priority projects should:

• Positively impact corridor performance (cost or time) by at least 5 percent

• Have an EIRR well above average for their sector (e.g., for road projects, 30
percent or higher)
• Be able to begin and generate benefits within the next three years

While other criteria such as regional integration impact or local political considerations
might seem appropriate, given the CDS focus on improving overall corridor performance,
all projects along the corridor, though located in one country, were considered regional
since their impact is beyond one country.

TOP PRIORITY INFRASTRUCTURE PROJECTS

In case funding is not available to implement the recommended action plan, the top
priority projects out of the recommended action plan have been identified. Based on the
application of the above criteria and the inclusion of those that are assessed as very critical
for promoting corridor efficiency, a list of 18 top priority infrastructure projects has been
selected (Table ES-2).
 xviii

Table ES-2
Top Priory CDS Infrastructure Projects

Cost
Name (US$ Corr.
mil.)
Port Projects
Dar es Salaam Short-term Container Handling Capacity 26.0 CC
Mombasa New Container Terminal – Kipevu West** 342.5 NC
Dar es Salaam Container Terminal (Berth 13 &14)** 500.0 CC
Mombasa New Petroleum Facility 55.8 NC
Dar es Salaam Single Point Mooring** 68.5 CC

Rail Projects
TRL Revival Infrastructure, Rolling Stock and Working
Capital and Isaka ICD 185.0 CC
RVR Infrastructure Upgrade 1 - 3 years ** 250.0 NC
RVR Mombasa Intermodal Yard and Equipment** 20.0 NC
RVR Kampala ICD Development ** 10.0 NC

Road Projects
Dar es Salaam port access bypass , new constr. (75 km) 40.0 CC
Chalinze - Tanga: (Coastal feeder) (170 km)** 71.4 CC
Eldoret - Bungoma (104 km) 14.5 NC
Molo - Eldoret (127 km) 17.7 NC
Mombasa - Voi (57 km) 9.9 NC
Voi - Kitui Rd Junction (135 km) 18.8 NC
Mwanza - Sirari/Kisii: Rehabilitation (239 km) 100.4 NC
Bujumbura -Gitega – Muyinga (149 km) 104.3 NC

Total All Top Priority Infrastructure Projects 1,773.0

Projects with funding already identified (**) 1,208.4
Projects requiring funding 564.6
Source: Prepared by Nathan Associates Inc.

The total investment requirement of these projects is US$ 1.8 billion, however, funding of
nearly US$ 1.2 billion for some of these projects has already been committed. Thus US$ 0.6
billion of funding is still required1.The top priority project list includes five port projects,
five rail projects, and eight road improvement projects. The projects are split almost
equally between the Northern and Central corridors in terms of investment cost of US$ 0.9
billion each.

Implementing the top priority Action Plan projects will substantially impact Northern
and Central Corridor performance.

On the Northern Corridor, the proposed projects would:

· Decrease the price of road transport by 23 percent

· Decrease the price of rail transport by 11 percent

1 In addition to the US$ 0.6 billion needed to fund the top priority projects, another US$ 2.0 billion would
be required if the complete CDS proposed investment program of US$ 4.2 billion were to be fully
implemented.
 xix

· Reduce the time of shipping by road by 28 percent.

· Reduce the time of shipping by rail by an average reduction of 47 percent

On the Central Corridor, the proposed projects would:

· Decrease the price of road transport by 9 percent

· Decrease the price of rail or rail/lake transport by 27 percent.
· Reduce the time of shipping overall by 35 percent

Overall, annual transport cost savings from the implementation of the proposed projects
by 2015 are estimated at US$ 1.2 billion, corresponding to an average reduction in
transport costs of 18 percent.

TOP PRIORITY OPERATIONAL PROJECTS

All of the proposed operational projects have been included as top priority interventions
for the Action Plan. These technical assistance projects and policy reforms are considered
essential for engendering the benefits from the infrastructure investments. The 19
operational projects are listed in Table ES-3 and their estimated total cost is US$ 23.2
million. A summarized description of each of the proposed CDS Action Plan operational
projects is presented in Table ES-5 at the end of this Executive Summary. Further details
are provided in the project profiles presented in Appendix A.

Table ES-3
Priority Operational Projects
Cost
Name (US$
Sector mil.)
Develop Northern Corridor Road Maintenance Contracting System Road 1.0
Develop Central Corridor Road Maintenance Contracting System Road 1.0
Improved Vehicle Overload Control System Road 1.8
Procure and Retain TRL Management Team Rail 2.0
Establish a Regional Railway Safety Regulator Rail 0.4
Develop Vessel Maintenance Capacity on Lake Tanganyika Lake 2.0
Enhance Safe Navigation Lake 3.0
Enhancing Mombasa Port Operations with ICT Applications Ports 2.5
Enhancing Dar es Salaam Port Operations with ICT Applications Ports 2.5
Liberalize Transit Requirements Transit 0.4
Maximize Customs Union Implementation Benefits Transit 0.3
Streamline Customs Border Clearances Transit 0.9
OSBP Implementation Transit 1.5
Reduce Informal Payments Transit 0.9
Implement an Effective Transit Regime Transit 0.9
Integration of National &Regional Transport Policies Transit 1.1
Leadership by NCTTCA Transit 0.3
Leadership by CCTTFA Transit 0.3
EAC PPP Diagnostic and Institutional Building Study Transit 0.4
Total All Operations Projects 23.2
Source: Prepared by Nathan Associates Inc.
 xx

LONGER-TERM NEEDS
As regards addressing long-term capacity constraints to cater for projected huge volumes
of traffic, we are aware that there will be need for implementing other projects beyond the
short to medium actions we have recommended. We are also aware there are plans and
efforts to develop new capacities in new ports, rail modernization and expansion as well
as more road upgrades and further capacity expansion. We have reflected these plans and
expect that clear development options and strategies will have emerged by the time the
recommended action plan is fully implemented. However we consider the recommended
Action Plan to be a strong foundation that is needed to hold future developments. It
creates corridor infrastructure that gives confidence to potential investors in economic or
traffic generating projects or activities. Such investment will catalyze the increase in
demand to support implementation of the long-term of projects that are being proposed.
Table ES-4. Overview of CDS Proposed Infrastructure Projects
Cost Est. Impact on Peformance CDS
(US$ Corr. Funding EIRR PPP Sequencing Priority Critical for
No. Project Name and Major Components Status mil.) Funded? Source Price Time Reliability (%) Potential Period Readiness (Start Year) Project Corridor
PORT PROJECTS

Mombasa Short-term Container Handling Capacity Enhancement

with ICDs
(1) TA to determine and promote imp0lementation of legal, regulatory,
Seven off-dock ICDs/CFSs handle containers (out of licensed seventeen). CFSs handle only a
tariff and operational procedures' reform (2) Relocating most
INFR-P-01 fraction of domestic containers; transit, reefer, oversize, hazardous and direct import containers 35.0 NC No n.a -4 -13 -23 165 High 2010-2013 Medium 2013 Yes Moderate
container processing activities from marine yard to CFSs,
are cleared at the marine terminal. KPA nominates or directs the allocation of boxes to CFSs.
(3) Simplifying transfers between marine yard and CFS, including
automation of marine gate,
(4) CFSs enhancing facilities and technical competency

Dar es Salaam Short-term Container Handling Capacity

Enhancement with ICD
(1) TA to determine and promote implementation of legal, regulatory, Six licensed ICDs handle containers (with additional five under development). ICDs handle
tariff and operational procedures' reform (2) Relocating most only a fraction of domestic containers; transit, reefer, oversize, hazardous and direct import
INFR-P-02 26.0 CC No n.a -2 -16 -7 226 High 2010-2013 Near 2011 Yes Very
container processing activities from marine yard to CFSs, containers are cleared at the marine terminal. Shipping lines determine the allocation of boxes
(3) Simplifying transfers between marine yard and CFS, including to ICDs.
automation of marine gate,
(4) CFSs enhancing facilities and technical competency

Mombasa New Container Terminal – Kipevu West

(1) Construction of 450,000 TEU terminal, ship to shore gantry cranes,
rubber tired cranes, and construction and extension of yards,
The technical designs for the container terminal are being finished. A loan agreement has been
2) Dredging of entrance channel to 15 m, widening the turning basin
signed with JICA for US$ 239 million to finance the terminal and related equipment and access
INFR-P-03 and Berth (11-15 m). (3) Extension of rail access to the terminal and 342.5 NC Yes Japan -3 -11 -23 37 High 2010-2013 Ready 2011 Yes Very
road. Tenders for the dredging were submitted in February 2010. Consideration of legal
buoy and channel markers in the access channel. (4) Construction of a
requirements for a concession is underway.
new access road to the terminal, possibly to be operated as a toll-road
(5) A consultant to advise on the final terms for the concession based
on experience with similar terminal concessions worldwide.

Dar es Salaam Container Terminal (Berth 13 &14 ) A feasibility study was completed in 2010. A consultant to prepare detailed design has been
Construction of Berths 13-14 upstream next to Berth 12, the Kurasini procured and design is ongoing. Financing of US$500 has been agreed with with the Chinese
INFR-P-04 500.0 CC Yes China -1 -15 -7 35 High 2010-2013 Ready 2011 Yes Very
oil jetty (KOJ), including dredging the entrance channel to deepen, Government/Exim Bank for implementation of the project. The experience with the first
widen and straighten it. concession will be taken into account in designing a legal agreement with the second
An international tender was issued by the National Oil Corporation of Kenya in late 2010 for a
Mombasa New Petroleum Facility
technical feasibility study of the construction of an offshore petroleum offloading jetty at
INFR-P-05 Design and construction of a BOT project for a single buoy point or off 55.8 NC No n.a -5 -12 -13 35 High 2010-2013 Ready 2011 Yes Very
Mombasa. EOIs were due December 3, 2010. It can be assumed that a full contract will be
shore jetty system
issued during 2011.

Mombasa Dry Bulk and General Cargo Facilities

Mbaraki Wharf: (1) new access bridges. (2) dust suppression. (3)
berth deepening to -12.5 m (4) berth extension by 220 m.
Berths 1-10: Development of a cruise ship terminal is in the planning The master plan reviewed the current facilities and usage, made projections for future growth
INFR-P-06 1.7 NC No n.a -3 -6 -10 25 Medium 2010-2013 Medium 2011 Yes Moderate
stages. Grain conveyor extended to Berth 4. Berth 5 could be and proposed project components to improve port efficiency in handling dry bulks.
converted to an additional grain terminal. The main changes are
some repaving and taking down some sheds to allow more storage
areas.
Dar es Salaam Dry Bulk and Break Bulk Facilities Tanzania Ports Authority has begun to implement these recommendations. Two tenders were
(1) Creation of a specialized dry bulk terminal at Berths 5-7 and issued in late 2010 for award in early 2011 for study of the silo and silo system at the port and
dredging to -12 m. Quay strengthening for heavier cranes. A provision of bulk handling facilities for grain and fertilizer. Separate tenders were issue for civil
conveyor belt to move cement. works for handling grain and fertilizer. Other tenders were issued including for paving the
INFR-P-07 5.0 CC No n.a -2 -5 -8 25 Medium 2010-2013 Ready 2011 Yes Moderate
(2) Expansion of the grain silo from 30,000 to 60,000 tonnes to allow area previously occupied by shed 4 to increase the yard area and procuring additional handling
handling of larger vessels. equipment and port vehicles. Some dredging is ongoing. These developments will take on
(3) Strengthening the quay at Berths 1-4 and dredging to a depth of -12 board the facilities being developed by the private sector, in particular the Dar es Salaam
m. Corridor Group.
Dar es Salaam Single Point Mooring A consulting consortium was contracted to act as financial and economic advisor to the project.
TConstruction of the SPM and two subsea pipelines. The SPM is It carried out traffic forecasts and analysis of the logistics, financial and economic impact of the
INFR-P-08 68.5 CC Yes ?? -5 -12 -13 35 High 2010-2013 Ready 2011 Yes Very
being constructed southeast of the harbor entrance and will project. In September 2010, Leighton International signed an EPC, fixed lump sum contract
accommodate ships from 40-150 KDWT. with TPA for construction of the US$66.48 million project.
Lamu Corridor New Port and Associated Infrastructure
The initial focus is on the completion of the current feasibility study,
During 2010, Japan Port Consultants were appointed to carry out a feasibility study, funded by
and depending on the results of the study, this is likely to be followed
INFR-P-09 the Kenyan Government, to be completed during 2011. KPA is directly involved in the study 7.0 NC No n.a n.a. n.a. n.a. 30 Medium 2010-2013 Medium 2012 No Marginal
by a detailed Environmental Impact Assessment. The study is
which is understood to be focused on the port master plan development for Lamu.
expected to include future projections of regional trade and freight
flows.
 Cost Est. Impact on Peformance CDS
(US$ Corr. Funding EIRR PPP Sequencing Priority Critical for
No. Project Name and Major Components Status mil.) Funded? Source Price Time Reliability (%) Potential Period Readiness (Start Year) Project Corridor
RAIL PROJECTS Status
TRL Revival Infrastructure, Rolling Stock and Working Capital and
Isaka ICD
(1) short term capital investment program for TRL and (2) provision
of working capital, over a two year period, to secure the operational
improvement of TRL under a new management team to be appointed. Government has initiated the process of selecting a new management team for TRL, in order to
The main components of the investment program will be ongoing prepare the necessary business plan to support new funding. A new World Bank project with
World
INFR-RL-01 track repair and upgrading in specified areas. This will be supported Tanzania includes provision of support for preparing TA for-repqaration of a business plan to 185.0 CC Partially -15 -11 -19 38 Low 2010-2013 Near 2011 Yes Very
Bank
by a complementary program for repair and refurbishment of TRL eneble mobilisation project funds for TRL revitalisation . Some funds have been made available
wagons and locomotives, with possible leasing of additional from the World Bank for consultants and T/A support for TRL.
equipment as defined by the approved business plan. The construction
of a new Isaka ICD of around 10 ha, capable of handling full TRL unit
trains of about thirty wagons in the initial phases.

TRL Track Infrastructure Upgrade 3-5 years

Phased upgrading of the TRL track infrastructure and signaling TRL is in an interim phase with no ability to secure new business until a new management
systems to allow more ‘modern’ and competitive train service to be team has developed a new business plan to support new investment. Besides a program for
operated – axle loads for 18 t to 20 t, longer trains, faster transit and track and equipment rehabilitation, a fully equipped ICD at Isaka is likely to be an important
INFR-RL-02 350.0 CC No n.a -4 -3 -5 27 Medium 2013-2016 Medium 2013 No Very
turnaround times, and greater reliability. In the first instance, this will element of the TRL business plan, whether or not it is directly finance and operated by TRL.
entail the track infrastructure to be upgraded with heavier rails and This could be developed by the private sector, but subject to performance commitments from
structures to a uniform standard on all the main lines, commencing TRL
with the lines between Dar es Salaam, Mwanza and Kigoma.

RVR Infrastructure Upgrade 1 - 3 years

Initial repair and upgrading of specific sections of poor track in both
Uganda and Kenya
The RVR railway concession in Kenya and Uganda has been restructured with a new
(i) Addressing inherited maintenance deficit.
commercial shareholder and the process of revival of the operations to restore the previous Citadel
(ii) Programmed ongoing track maintenance activities.
INFR-RL-03 capacity of the rail systems has commenced. The first 1 to 3 year phase is focused on improving 250.0 NC Yes and -2 -6 -9 22 High 2010-2013 Ready 2011 Yes Very
(iii) Planned rehabilitation works for particular sections which require
reliability and increasing traffic volumes, and if successful, will be followed by a program to financiers
more attention than simple maintenance program including track
increase capacity.
rehabilitation of a 30 km section between Mombasa and Nairobi and
in the Jinja region in Uganda.

RVR Locomotive Rehabilitation -3 years

Repair and upgrading of the existing RVR locomotive fleet in both
The locomotive repair program has been commenced by RVR in both Uganda and Kenya, with Citadel
Kenya and Uganda, in order to achieve availability of more than 90
INFR-RL-04 the initial objective of rectifying deferred maintenance and recommencing the standard 20.0 NC Yes and -4 -11 -15 22 High 2010-2013 Medium 2013 No Moderate
percent: A major mainline locomotive overhaul is likely to cost more
maintenance programs. financiers
the US$0.5 million per unit. A similar program is being implemented
for the wagon fleet.
RVR Infrastructure Upgrade 3 - 5 years
The second phase of track rehabilitation, focused on increasing
capacity, will involve upgrading of the track to improve operating RVR has stated that it is in discussions with Tullow Oil for servicing the Uganda oil sector
speeds and allow for more frequent and longer trains. Improved development, which could provide the basis a significant upgrade and expansion of the railway Citadel
INFR-RL-05 signaling will also be necessary. The engineering works will include network, initially based on inputs, and later also on outputs. The RVR railway concession in 150.0 NC Yes and -2 -5 -6 22 High 2013-2016 Medium 2013 No Moderate
the replacement of worn rails, likely in conjunction with upgrading to Uganda has been expanded to include the possible reopening of the northern rail link to Gulu financiers
allow for heavier axle loads, realignment of sections in difficult and Packwach, to serve the oil sector around Lake Albert.
topography, and the provision of longer and more frequent passing
loops.

RVR Mombasa Intermodal Yard and Equipment

RVR have operated unit or block intermodal trains in the past, and intend to reintroduce this
The lengthening of the rail sidings at the existing container terminals
for all rail container services to and from Mombasa. A commitment has been made by KPA to
INFR-RL-06 in conjunction with the extension of Berth 19, the provision of 20.0 NC Yes Citadel -1 -2 -3 26 High 2013-2016 Medium 2011 Yes Very
convert existing general cargo Berths to container terminals, possibly as PPP projects, and also
additional RMGs, and additional terminal equipment – reach stackers,
to build the new terminal at Kipevu West
rubber tired gantries and port tractor - trailer units.

RVR Kampala ICD Development

The existing yard is to be expanded and upgraded, with new It is RVR’s stated intention to expand and upgrade their Kampala ICD as part of their targeting
INFR-RL-07 equipment and longer rail sidings. Rail access should be directly from of the intermodal transit traffic. A similar development or expansion will take place at Nairobi 10.0 NC Yes Citadel -1 -2 -3 21 High 2010-2013 Medium 2011 Yes Very
the main line and road access should be directly to the key ring roads and other major economic centers served by rail.
and bypasses.

Reconstruction of Tororo-Gulu- Pachwach Railway

The feasibility study for reopening the railway to Gulu and Pakwach has been completed (not
Upgrading of the existing northern railway, approximately 500 km,
yet seen by the consultants) and the RVR railway concession agreement has been expanded to
from the current 25 kg/m rail to +40 kg/m track, 20-t axle loads, with
include the northern line. Proposals have also been considered by the Ugandan and south
INFR-RL-08 possible realignment in sections in order to increase operating speeds. 325.0 NC No n.a n.a. n.a. n.a. 24 Medium 2010-2013 Medium 2013 No Marginal
Sudanese governments for upgrading the line from Tororo to Gulu to standard gauge (400 km)
This will include strengthening of bridges and culverts, lengthening of
and extending the railway from Gulu to Juba in southern Sudan (250 km), to serve as an
passing loops, and provision for later upgrading to a standard gauge
alternative route to the proposed Juba to Lamu standard gauge railway.
specification (three rail system).
 Cost Est. Impact on Peformance CDS
(US$ Corr. Funding EIRR PPP Sequencing Priority Critical for
No. Project Name and Major Components Status mil.) Funded? Source Price Time Reliability (%) Potential Period Readiness (Start Year) Project Corridor

The World Bank has supported the concept of establishing a remote CFS at Dar es Salaam by
Dar es Salaam CFS Site Selection Design and Project Preparation funding a pre-feasibility study, which was completed in December 2010. A detailed site
(Kisarawe) selection study needs to be carried out, (selection matrix which includes all influencing factors)
The project preparation, including site optimum location and design prior to finalizing the layout and design of the CFS. This could possibly be done in conjunction
INFR-RL-09 2.0 CC No n.a -1 -1 -1 n.a. Medium 2010-2013 Medium 2012 No Moderate
for the development of a remote cargo freight station for Dar es with the issuing of an EOI for the location, design and development of a CFS, based on the
Salaam, including the provision for a surrounding industrial preliminary study, in order to test private sector investor and operator interest in the project at
development zone, as PPP project. an early stage. The World Bank has expressed readiness to support appointment of a
transaction advisor for the project.

ROAD PROJECTS Country Type Km Status

Dar es Salaam port access bypass (to Mlandizi) New constr. Tanzania Capacity upgrade 75 -- 40.0 CC No n.a -0.6% -1.3% -1.3% 95 Medium 2011 -- 2011 Yes Very
Bubanza - Cyangugu/Bukavu Burundi Road rehabilitation 77 -- 32.3 CC No n.a -0.2% -0.3% -0.1% 31 Low 2011 -- 2012 Yes Moderate
Muyinga – Kanazi Burundi Road rehabilitation 27 -- 18.9 CC No n.a -0.1% -0.2% -0.1% 36 Low 2011 -- 2012 Yes Moderate
Chalinze - Tanga: (Coastal feeder) Tanzania Road rehabilitation 170 Under construction 71.4 CC Yes -- -0.4% -0.6% -0.2% 72 Low 2010 Ready 2010 Yes Very
Bujumbura – Gitega - Muyinga Burundi Upgrade to paved 149 -- 104.3 CC Yes -- -0.6% -1.2% -0.2% 63 Low 2014 Ready 2011 Yes Moderate
Dodoma – Kalema (Dodoma feeder) Tanzania Upgrade to paved 167 -- 116.9 CC No n.a -0.6% -1.3% -0.2% 177 Low 2014 -- 2014 Yes Moderate
Iringa - Dodoma (Dodoma feeder) Tanzania Upgrade to paved 182 -- 127.4 CC No n.a -0.7% -1.4% -0.2% 75 Low 2014 -- 2014 Yes Moderate
Kalema - Arusha (Dodoma feeder) Tanzania Upgrade to paved 68 -- 47.6 CC No n.a -0.3% -0.5% -0.1% 115 Low 2014 -- 2014 Yes Moderate
Athi River Sorroundings Kenya Capacity upgrade 16 -- 6.5 NC Yes EU -0.1% -0.1% -0.2% 56 Low 2011 Ready 2011 Yes Moderate
Eldoret - Bungoma Kenya Capacity upgrade 104 -- 14.5 NC Yes AfDB -0.1% -0.2% -0.4% 117 Low 2011 Ready 2011 Yes Very
Molo - Eldoret Kenya Capacity upgrade 127 -- 17.7 NC No n.a -0.2% -0.2% -0.5% 157 Low 2011 -- 2011 Yes Very
Mombasa - Voi Kenya Capacity upgrade 57 -- 9.9 NC No n.a -0.1% -0.1% -0.3% 189 Low 2011 -- 2011 Yes Very
Voi - Kitui Rd Junction Kenya Capacity upgrade 135 -- 18.8 NC No n.a -0.2% -0.2% -0.5% 239 Low 2011 -- 2011 Yes Very
Fort Hall - Embu - Isiolo: (Moyale- Dodoma Spur) Kenya Capacity upgrade 99 -- 17.3 NC No n.a -0.1% -0.2% -0.4% 42 Low 2011 -- 2012 Yes Moderate
Kajiado - Namanga - Arusha: (Moyale- Dodoma Spur) Kenya Capacity upgrade 32 -- 6.7 NC No n.a -0.1% -0.1% -0.2% 76 Low 2011 -- 2011 Yes Very
Eldoret - Kitale: (Lokichogio Spur) Kenya Capacity upgrade 53 -- 9.1 NC No n.a -0.1% -0.1% -0.2% 40 Low 2011 -- 2012 Yes Moderate
Kampala - Masaka - Mbarara Uganda Capacity upgrade 104 -- 19.1 NC No n.a -0.2% -0.2% -0.5% 53 Low 2011 -- 2012 Yes Moderate
Kampala & surroundings (50 percent Jinja-Kampala) Uganda Capacity upgrade 81 -- 14.1 NC No n.a -0.1% -0.2% -0.4% 45 Low 2011 -- 2012 Yes Moderate
Tororo - Bugiri - Jinja Uganda Capacity upgrade 31 -- 6.3 NC No n.a -0.1% -0.1% -0.2% 47 Low 2011 -- 2012 Yes Moderate
Mwanza - Sirari/Kisii: Rehabilitation Tanzania Road rehabilitation 239 -- 100.4 NC No n.a -2.8% -2.2% -1.9% 38 Low 2011 -- 2011 Yes Very
Bujumbura -Gitega – Muyinga Burundi Upgrade to paved 149 -- 104.3 NC No n.a -3.6% -5.1% -2.2% 63 Low 2011 -- 2011 Yes Very
LAKE TRANSPORT PROJECTS Status
Lake Ports Rehabilitation, Dredging and Siltation Protection
(1) Complete or initiate dredging of ports of especially Kigoma,
Dredging at some ports on Lake Tanganyika and Victoria has been done or is ongoing, with
Bujumbura, Kalemie, Mwanza, Port Bell, and Kisumu to restore
own funding (TPA) and assistance from Belgium. There are two major initiatives the Lake
design depths of around 6 m.
INFR-L-01 Victoria Basin Commission (LVBC) and the Lake Tanganyika Basin Commission (LTBC) that 14.0 CC No n.a -2 -2 -8 34 Low 2010-2013 Ready 2011 Yes Moderate
(2) Establish a watercourse management system to minimize soil
are ongoing and have established comprehensive investment strategies. In this an investment
erosion and sedimentation.
conference for LBVC was held in Mwanza on mobilizing finance for implementation.
(3) Rehabilitating or establishing of areas and ramps to accommodate
vehicles for RoRo operations.

Provision of RoRo Services on Lakes Tanganyika and Victoria

(1) Mobilizing private sector, especially those involved in provision of There are some private sector operated barges on both Lake Tanganyika and Victoria. Barges
INFR-L-02 lake services, to buy into and establishing RoRo services; (2) can be built at existing shipyards at some ports on both lakes, albeit with some slight 15.4 CC No n.a -1 -1 -5 28 High 2010-2013 Medium 2012 No Moderate
acquisition of barges by fabrication at local shipyards, MAFI trailers improvement if need be.
fabricated locally and import of tugs.

Restructuring Wagon Ferries to Carry MAFI Trailers

(1) The first part will be to carry out a technical feasibility analysis of
INFR-L-03 There are no known existing plans to convert the wagon ferries. 7.0 CC No n.a -1 -1 -2 28 High 2010-2014 Near 2011 No Moderate
the conversion, especially related to stability and safety standards; and
(2) carrying out the conversions at local shipyards.

TRANSIT FACILITATION PROJECTS Status

Design and construction of OSBP facilities and ancillary road • At Malaba, donors have been involved in designing OSBP including USAID, WB
improvements at an average cost of US 10 million per facility. Facilities • At Gatuna/Katuna OSBP design and construction is being supported by the WB
targetted include Gatuna/ Jatuna; Akinyaru/Kinyaru haut; Rusumo; • At Akinyaru/Kinyaru Haut , the AfDB financing a new bridge and OSBP
Kobero/ Kabnga; Kagitumba/ Mirama Hills; Tunduma; • At Kobero/Kabanga on the Burundi/Tanzania border, TMEA WB, JICA,
• At Kagitumba/Mirama Hills, with TMEA support the Design and Supervise contract was CC &
INFR-TF-01 Cyanika;Cyangugu/Rusizi 1; Rusizi 2; Mutukula; and Mpondwe. 110.0 Yes AfDB, -1 -1 -1 22 Medium 2010-2013 Near 2011 Yes Moderate
awarded ; a workshop with stakeholders and the architect was held and a report of that NC
TMEA
meeting circulated.
• At Tunduma, with TMEA support, the Inception Report was completed and presented to
stakeholders; the plans were approved in principle.

Total all infrastructure projects 3,293.4

Projects with funding committed 1,613.5
Projects without committed funding 1,679.9
Prepared by Nathan Associates Inc.
Table ES-5. Overview of CDS Proposed Operational Projects

Cost CDS
(US$ mil.) Funding PPP Priority Critical for
No. Mode Name and Major Components Status Funded? Source Potential Project Readiness Corridor
Develop Northern Corridor Road Maintenance Contracting System
(1) Assessment of technical, legal, institutional, finance and methodological frameworks Roads are managed by Road Agencies/Authorities and maintained on contract for specific works
and approaches to implement long term contracts, as well as to define possible defined such as routine maintenance, re-sealing/periodic maintenance. Finance is from Road funds and
OPER-RD_01 Road 1.0 No n.a. High Yes Medium Moderate
packages/sections to be put under such contract; (2) Transaction Advisory services to Government budget allocation. When there is no finance, maintenance is postponed, thus accumulating
structure identified possible contracts, prepare RFPs and assist with procurement of deferred maintenance and accelerated road deterioration.
maintenance contractors.

Develop Central Corridor Road Maintenance Contracting System

Roads are managed by Road Agencies/Authorities and maintained on contract for specific works
(1) Assessment to identify technical, legal, institutional, finance and methodological
defined such as routine maintenance, re-sealing/periodic maintenance. Finance is from Road funds and
frameworks and approaches to implement long term contracts, as well as to define
OPER-RD_02 Road Government budget allocation. When there is no finance, maintenance is postponed, thus accumulating 1.0 No n.a. High Yes Medium Moderate
possible packages/sections to be put under such contract; (2) Transaction Advisory
deferred maintenance and accelerated road deterioration. Long-term contracting has been adopted on a
services to structure identified possible contracts, prepare RFPs and assist with
pilot basis for some gravel roads in Tanzania.
procurement of maintenance contractors.

Improved Vehicle Overload Control System

(1) TA to assist member states to allign legislation on vehicle limits with regional
.The EAC is carrying out a study to review axle and load limits, which will guide an overload control
standards and to pass new regulations providing for administrative penalties. (2)
system in EAC. The study, financed by JICA, aims at harmonization of axle load limits within the
Outreach activities to sensitize the trucking industry to the implications of the new rules
OPER-TF-01 Road Tripartite (COMESA, EAC and SADC) region. Existing overloading control strategy in Kenya, Uganda 1.8 No n.a. Medium Yes Near Very
are useful to ensure smooth implementation of the administrative system and to secure
and Tanzania is aimed at achieving one hundred percent inspection of all commercial vehicles. The
the co-operation of industry – from an early stage – to improve compliance levels.
frequency of checks is also a concern.
(3)Training of weighbridge staff and law enforcement officers in the implementation of
the new rules is also needed.

Procure and Retain TRL Management Team

Phase 1: (1) Preparation of the TOR for a performance based management contract,
working jointly with MOID and RAHCO, (2) Motivation of funding for the management
contract , preparation of tendering process, prequalification, adjudication, preparation of TRL is currently in an interim stage, being managed through RAHCO, with TRL staff salaries being
management contract and appointment of management contractor. guaranteed by government, but TRL being responsible for all other operating costs. RAHCO has World
OPER-RL-01 Rail 2.0 Yes Low Yes Ready Very
Phase 2 : Retain TRL management team for a period of two years, management the requested Expressions of interest for organizations interested in providing technical assistance Bank
operation of TRL, prepare detailed business plans, including cash flows and financing todevelop a viable business plan for TRL.
schedule, presentation of business plan to secure funding, prepare and implement
marketing plan to target intermodal sector and increase freight levels. Study option for
future operational structure for TRL and prepare contracts for operating concession.

Establish a Regional Railway Safety Regulator Safety regulation of railway operations fall under the respective ministries of transport in Kenya and
TA to investigate and propose a structure for the establishment and operation of a Uganda, and under a specialized unit in Tanzania, SUMATRA (Surface and Maritime Transport
regional railway safety regulator and the linkages to the various national transport Authority), which is also responsible for transport economic regulation. There has been no attempt or
OPER-RL-02 Rail 0.4 No n.a. Low Yes Medium Marginal
safety regulators. This will be confined to the Northern and Central Corridors only, initiative to set up a regional railway safety regulator, mainly because of the general decline in railway
rather than the EA region, because of the limited geographical coverage of the 1,000 mm services in both corridors and the problems experienced with both the TRL and RVR railway
gauge system. concessions.
Develop Vessel Maintenance Capacity on Lake Tanganyika
(1) Assessment of ship/vessel repair facilities on Lake Tanganyika and propose a
strategy to develop adequate facilities to match future requirements, including an Each main port (Kigoma, Kalemie and Bujumbura) has some repair facilities managed by respective
OPER-L-01 Lake institutional framework to ensure access by vessels irrespective of their country of Port Authorities. An assessment of these facilities is required to determine a strategy for development 2.0 No n.a. Yes Medium Marginal
origin; (2) promote and secure the interest of potential investors and managers of the adequate and integrated vessel repair facilities on the Lake.
facilities; (3) improvement/development of the facilities by interested
investors/operators.
 Cost CDS
(US$ mil.) Funding PPP Priority Critical for
No. Mode Name and Major Components Status Funded? Source Potential Project Readiness Corridor

Enhance Safe Navigation

(1) Undertake/complete hydrographic surveys and install lake-wise and port
navigational aids for safe passage of ships; (2) Adopt recognized classification society
Safety issues are included in the two main initiatives for the two Lakes: The Lake Victoria Basin
rules regarding construction of ships/vessels; (3) introduce meteorological navigational
OPER-L-02 Lake Commission (LBVC) and Lake Tanganyika Basin Commission (LTBC) under which comprehensive 3.0 No n.a. Low Yes Medium Very
warnings and other services; (4) establish search and rescue organization and adopt a
development and investment strategies are being pursued.
harmonized implementation policy and strategy, including the possible use of Global
Maritime Distress Safety System (GMDSS) and (5) harmonize port security, safety and
environmental compliance strategies.

Enhancing Mombasa Port Operations with ICT Applications

(1) Establish a response mechanism for short term TA in the development and
Kenya has financing from the World Bank to develop a single window centralized in the Kenyan
implementation of the systems. An overall budget would be established and the port or
Cabinet through the Ministry of Finance. Thus it is not housed in any of the border control agencies.
Project Team would be able to draw down on it as problems are encountered that are World
OPER-P-01 Ports This position enables it to coordinate all government ministries’ participation. Kenya’s plan is to 2.5 Yes Medium Yes Ready Very
not addressed in long term financing commitment to the project. A separate budget Bank
develop and implement the system at the port of Mombasa, Kenyatta International Airport and land
would be established for incorporation of off the shelf software and adaptation as
borders. Kenya has just recruited additional specialists to the team designing the system.
necessary. The Project would provide assistance in acquiring software on a PPP basis
which includes involvement of software developer on an equity or loan basis.

Enhancing Dar es Salaam Port Operations with ICT Applications

(1) Establish a response mechanism for short term TA in the development and
implementation of the systems. An overall budget would be established and the port or Tanzania Ports Authority requested funding a feasibility study for a community-based system under
Project Team would be able to draw down on it as problems are encountered that are the East Africa Trade and Transport Facilitation Project. This feasibility study for the implementation of
OPER-P-02 Ports 2.5 No n.a. Medium Yes Ready Moderate
not addressed in long term financing commitment to the project. A separate budget a community-based system has now been completed. The Dar es Salaam port community is in process
would be established for incorporation of off the shelf software and adaptation as of setting up an organization to develop and implement the system.
necessary. The Project would provide assistance in acquiring software on a PPP basis
which includes involvement of software developer on an equity or loan basis.

Liberalize Transit Requirements

(1) TA support to EAC to facilitate discussion between public and private sector
The Tanzania Revenue Authority has experimented with permitting truckers to load backhauls using
stakeholders on phasing out licensing of transit vehicles and vehicles carrying goods
transit vehicles provided the truck follows the prescribed transit route and reports to TRA check points
OPER-TF-02 Transit under customs control (2) The proposed option should be piloted on the two corridors 0.4 No n.a. Low Yes Medium Moderate
along the route and to TRA at the conclusion of the trip. While adding to the delays for domestic
and refined based on the pilot. (3) Once a system has been agreed among the agencies
haulage, it enables the vehicle to return loaded.
involved, the regulations should be modified to accommodate the solution. (4) A
system for monitoring impact should be part of the proposal.

Maximize Customs Union Implementation Benefits

The EAC Customs unit in the Secretariat is currently working on the tariff collection system and seeking
TA is proposed to review the transport cost, time and reliability impact of various
agreement of all member states. In meetings with national customs authorities, it was evident that the
proposals for full implementation of the Customs Union. The purpose is to propose a
OPER-TF-03 Transit national revenue authorities are not consulting with transport agencies in developing transit 0.3 No n.a. Low Yes Near Moderate
series of recommendations to the EAC Secretariat and the national governments on the
regulations. It is the right time to provide insight on the impact on transport charges, operational
impact of each collection method on transport efficiency and trade development within
efficiency and vehicle utilization.
the Community as well as external trade.

Streamline Customs Clearances

(1) A coordinated program of regional training/capacity building on customs JICA has been providing training in risk management systems and some partner states such as Uganda
modernization tools followed by regional TA on implementation at national level and have fully implemented it so that clearances are expedited for compliant traders and operators. A
harmonization at regional level. The training and capacity building must involve the monthly review of risk profiles insures that the Uganda system reflects current performance of corridor
border control agencies and the private sector. The objective is to more effectively users. Uganda has been working on a system of accredited operators, but not yet implemented. Rwanda
OPER-TF-04 Transit 0.9 No n.a. Medium Yes Near Moderate
implement Risk Management, Accredited Economic Operator Programs, Preclearance has begun implementing an accredited operator system with its blue channel system which has reduced
and Prepayment. (2) TA to produce harmonized regional guidelines based on activity clearance time in Kigali from two to three days to a few hours for compliant customers. The World
(1) above and programs implemented at national level. This would be followed by TA Customs Organization is supporting this kind of initiatives and should be a resource to draw on for
to facilitate incorporation in national procedures and operations to insure that the information and potential support.
harmonization is realized.
 Cost CDS
(US$ mil.) Funding PPP Priority Critical for
No. Mode Name and Major Components Status Funded? Source Potential Project Readiness Corridor
(1) In 2010, an EAC legal framework for OSBP was developed with assistance from JICA and approved
OSBP Implementation up to the Multi-sectoral Council of Ministers. The draft EAC OSBP Act, which establishes the legal
(1) TA for the Customs unit in EAC Secretariat in finalizing and obtaining consensus on authority and procedures for OSBP, will be introduced to the EAC Legislative Assembly in early 2011.
OSBP procedures and an oversight mechanism to insure common development of (2) JICA is funding a project to develop a resource document for OSBP implementation based on current
OSBPs. Three consultative workshops are planned for technical agreement on proposed experience and lessons learned at other OSBP, particularly within Africa. (3) A number of projects are
procedures. carrying out feasibility studies and engineering design for OSBP facilities on the Northern and Central
(2) Border management information systems are needed for single electronic entry of Corridors. At Malaba, the busiest border on the Northern Corridor, several donors have been involved
data and information-sharing. The initial entry into a single data base, sharing of in designing OSBP including USAID, World Bank and DfID.At Gatuna/Katuna on the
OPER-TF-05 Transit information and handling of preclearance of cargo for compliant customers should be Uganda/Rwanda border and Mutukula on the Uganda/Tanzania border OSBP design and construction 1.5 No n.a. Medium Yes Ready Very
built into the system. It should also take into account the future changes that will need is being supported by the World Bank as part of the East Africa Trade and Transport Facilitation Project.
to occur with further implementation of the Customs Union and Common Market. This While procurement is done nationally, Bilateral Committees have been working to coordinate
component entails support for software development and implementation, including engineering design and procedures to insure harmonization between the juxtaposed facilities. At
training and updating of software. It includes preparation of information sharing Akinyaru/Kinyaru Haut between Rwanda and Burundi, the African Development Bank is funding a
legislation, if necessary, among national border agencies. feasibility study under the East Africa Trade and Transport Facilitation Project. At Rusumo on the
Tanzania/Rwanda border, JICA is in final approval for financing a new bridge and OSBP border posts.
At Kobero/Kabanga on the Burundi/Tanzania border, DfID through Trade Mark East Africa is
financing a feasibility study and engineering design for an OSBP.

Reduce Stops and Informal Payments on Corridors

(1) TA to work with police departments to set up an internal monitoring unit and to
design their own programs to control the number and frequency of official stops and to
eliminate other stops. (2) A public information program will be incorporated to Efforts have been made by organizations, such as the Private Sector Foundation and the East African
OPER-TF-06 Transit discourage payment of bribes and encourage reporting of officers requesting money. Business Council to monitor the situation and to lobby for better control over informal stops and 0.9 No n.a. Medium Yes Near Very
(3) The NCTTCA and CCTTFA should be involved in the effort to promote integrity on payment demands. These efforts need to be actively supported and expanded to reduce this practice.
an on-going basis and have some funds to begin a process of monitoring the roads for
compliance. The TA would fund setting up a program for long-term monitoring and
stakeholder awareness by the corridor groups that is sustainable.

Implement an Effective Transit Regime

TA to achieve the following:
1) Implementation of harmonized vehicle weight and dimension standards and
enforcement with a goal of weighing only at port, border (s) and destination.
2) Recognition of road worthiness testing and certificates by all authorities and
Many aspects of a transit regime exist, but have not been fully implemented. Common vehicle
insurance agencies. Assistance to programs that are weak, either in testing capacity or
regulations have been issued, but not fully implemented and there are current efforts to change again.
enforcement.
Road worthiness standards have been promoted, but there is lack of trust in the systems of other EAC
3) Single customs document produced once with a copy for all customs agencies and
partner states. Customs declaration have been simplified and harmonized, but each country still
OPER-TF-07 Transit copy retained by driver with stamps from all customs agencies. Conversion to and 0.9 No n.a. Medium Yes Medium Moderate
requires its own form under national insignia. While they can be filed electronically, they cannot be
regional recognition of electronic entries, verification and release.
modified and most countries still require the hard copy as the legal copy. RADDEx and the common
4) Full implementation of RADDEx in all Corridor countries to allow effective tracking.
customs bond have been partially implemented in EAC. There is need for a more coordinated, pro-
Application of tracking systems for customs, vehicle agencies, and forwarders/shippers
active program of implementing a single system.
using RADDEx.
5) Common customs bond administered on each corridor and later adopted in the
region. Immediate acquittals of bond at conclusion of journey.
6) Agreement for full sharing of information on the corridor.
 Cost CDS
(US$ mil.) Funding PPP Priority Critical for
No. Mode Name and Major Components Status Funded? Source Potential Project Readiness Corridor
Integration of National &Regional Transport Policies
TA to support EAC states to implement the Tripartite Agreement. This is required to:
Domestic road transport policies in all states are aimed at deregulated market access, which has had
• Revise existing legislation and adopt new legislation to domesticate the Agreement in
some positive effects, but the lack of qualitative regulation has also had several undesirable
the national laws of the member states;
consequences. These include low entry barriers leading to cut throat competition, low safety levels and
• Design licence application, adjudication and issuing procedures and forms;
poor service quality. Operational standards need to be improved and governments need to align their
• Design license administration software systems and procure hardware;
policies to encourage the growth of a professional transport industry which is able to compete
• Train personnel in the handling of applications, adjudication and issuing;
effectively within a framework of clearly-defined rules and appropriate regulation. National policies do
OPER-TF-08 Transit • Train law enforcers in the application of on-the-road enforcement of the rules under 1.1 No n.a. Low Yes Medium Moderate
not, as yet, prioritize regional commitments appropriately which partially underlies the failure of
the Agreement;
governments to implement the Tripartite Agreement. Non-implementation of the Agreement carries a
• Develop transport supply and demand capacity to manage competition between
significant opportunity cost, as the potential cost savings and efficiency improvements envisaged by the
carriers from different states; and
Agreement are not captured. Road transport operations on the corridors remain constrained by
• Undertake monitoring and evaluation.
conflicting national rul the corridor.
Committees have been worki

A series of studies have recently been carried out for them, including the recent transport observatory,
master plan for infrastructure development just being completed and a study of transport costs on the
Leadership by NCTTCA corridor. A spatial development study has also been carried out to review the opportunities for value-
TA to assist in establishing a consultative public private process, based on the recent added resource businesses and manufacturing on the Northern Corridor. NCTTCA is well established,
studies, to set the work agenda and commit government agencies and private sector to but needs a way to more fully engage their public sector members in the improvement process and to
OPER-TF-09 Transit 0.3 No n.a. Low Yes Ready Marginal
responsibility for specific tasks to motivate and monitor achievement of the CDS Action more fully incorporate the private sector in identifying problems and solutions. Specifically NCTTCA
Plan. TA would fund meetings for the first two years, and fund 50 percent for the third needs to establish a monitoring system of implementation of the action plan, securing fulfillment of
year as the mechanism is made sustainable commitments made by its members and publishing impact of implementation for the benefit of users of
the corridor. As NCTTCA seeks to implement the Action Plan, it needs access to some additional TA
and field work on a demand basis.

Leadership by CCTTFA
TA to assist in establishing a consultative public private process, based on observatory
findings, to set the work agenda and commit government agencies and private sector to CCTTFA is currently finalizing staff appointments and developing its work plan. An observatory is just
responsibility for specific tasks to motivate and monitor achievement of the CDS Action being completed that will form a base line for measuring performance results and for monitoring on an
OPER-TF-10 Transit Plan. The CCTTFA Board and Stakeholders Consultative Forum, which has equal on-going basis. Under the East Africa Trade and Transport Facilitation Project, CCTTFA has funding 0.3 No n.a. Low Yes Ready Marginal
public – private membership, would lead the process for CCTTFA and create the link for a business plan study. The development of the business plan and this TA should be coordinated so
between the Facilitation Agency and national government action. TA would fund as to avoid duplication.
special CDS meetings for the first two years, and fund 50 percent for the third year as
the mechanism is made sustainable

EAC PPP Diagnostic and Institutional Building Study

The potential role of regional institutions in developing PPP markets encompasses both Draft terms of reference have been prepared and are expected to be undertaken as part of an EAC- TMEA,
OPER-TF-11 Transit upstream and downstream aspects of the PPP project preparation cycle: (1) Legislative, 0.5 Yes Low Yes Ready Moderate
World Bank Group (WBG) – Trademark collaboration. WB
Regulatory and Institutional Framework covering also fiduciary ; (2) Institutional
Solutions for a potential EAC PPP Center of Expertise (3) PPP pipeline and Project
Development Facility (PDF) options; and (4) Financing mechanisms for PPPs.
Total 23.2
Prepared by Nathan Associates Inc.
1. Introduction
Background
The Northern Corridor, anchored by the port of Mombasa in Kenya, and the Central
Corridor, anchored by the port of Dar es Salaam in Tanzania, are the principal transport
routes for national, regional, and international trade of the five East African Community
(EAC) countries—Burundi, Kenya, Rwanda, Tanzania, and Uganda. Because of
inadequate physical infrastructure and inefficiency, these corridors are characterized by
long transit times and high cost. Freight costs per km are more than 50 percent higher
than costs in the United States and Europe, and for the landlocked countries, transport
costs can be as high as 75 percent of the value of exports. Modernization of transport
infrastructure and removal of nontariff barriers along these corridors are critical for trade
expansion and economic growth, which are key to the success of regional integration, the
creation of wealth, and poverty alleviation in these countries.

The Heads of State in the COMESA, EAC and SADC, the Tripartite, have determined that
the transport inefficiencies are among the biggest impediments to realizing their vision to
lead their countries out of poverty. Transport costs are prohibitively high and are a barrier
to trade and investment, which form the cornerstone for economic growth and regional
prosperity.

Having had the experience of successful development of an action plan to eliminate

transport bottlenecks on the North-South Corridor, the Tripartite has ordered the
preparation of a similar action plan for the key trade routes of Eastern Africa. As a
technical foundation for the action plan, regional stakeholders in March 2009 agreed to
carry out a corridor diagnostic study (CDS) with funding from the U.S. Agency for
International Development (USAID) and the U.K. Department for International
Development (DFID).

Goals of the Study

To overcome the challenges the Governments face in the region, the Corridor Diagnostic
Study’s goals focus on:

• Collecting and synthesizing existing information on time and cost of transporting

goods
• Compiling and assessing national and regional policies
 2

• Analyzing costs and benefits of interventions

• Setting a baseline to measure future corridor improvement
• Highlighting solutions that include PPPs
• Creating an action plan

The action plan is to guide development of an efficient transport system in the East Africa
region. It will galvanize implementation in the member countries and support from
international partners and private sector. The action plan will be presented by the
Tripartite at an international investment conference to showcase the approach and
mobilize investment finance. Major finance institutions, the private sector, investment
funds and consortiums, and bilateral and multilateral donors will be invited to
participate. It is expected that the CDS will make a difference in securing implementation
of projects and removing the long-standing transport bottlenecks in East Africa.

The Action Plan is not a long-term development strategy but is focused on identifying
measures that can have an immediate impact on the corridors’ performance. The projects
proposed therefore are those that can be implemented within five years. A set of
infrastructure and operational interventions have been identified analyzed and
prioritized. These interventions were presented in the form of a Draft Action Plan at a
Regional Stakeholder Workshop in Dar es Salaam on February 24-25, 2011 and were
approved, subject to a few modifications, for further consideration by the Tripartite.

Geographic Scope of Study

The Corridor Diagnostic Study reviewed the infrastructure condition, non-tariff barriers,
and policy, regulatory and institutional aspects of the Northern Corridor anchored by the
port of Mombasa in Kenya, and the Central Corridor, anchored by the port of Dar es
Salaam in Tanzania, which are principal and crucial transport routes for national, regional
and international trade of the five East African Community (EAC) countries, namely;
Burundi, Kenya, Rwanda, Tanzania and Uganda (see Figure 1-1). The CDS analysis also
includes the extension of the Northern and Central Corridors to the Democratic Republic
of the Congo and links to Southern Sudan, Ethiopia and Zambia.
 3

Figure 1-1
CDS Geographic Scope

Collaboration with Other Regional Transport Studies

Concurrent with the CDS are several other regional transport studies addressing corridor
performance and identifying priorities for infrastructure investment in eastern Africa:

• Northern Corridor Infrastructure Master Plan conducted for the NCTTCA by

Louis Berger International

• EAC Transport Strategy and Road Sector Development Program conducted for
the EAC by Aurecon

• Northern Corridor Analytical Comparative Transport Cost Study conducted for

the NCTTCA by CPCS Transcom Limited.

• Definition and Investment Strategy for a Core Strategic Network for Eastern and
Southern Africa conducted for the World Bank by Nathan Associates Inc.

As directed by the studies’ sponsors, the four firms responsible for these studies identified
areas of commonality in which to share data, information, and analytical findings to make
the most effective use of study resources and enhance the studies’ quality and
consistency. Further collaboration included the joint review of the proposed infrastructure
and operational projects called for in the Action Plan.

The focus of these other studies differs from that of the CDS in several regards. First the
time horizon of the Northern Corridor Infrastructure Master Plan (to 2030), the Core
Strategic Network (to 2030) and the EAC Transport Strategy (to 2020) is longer than the
horizon of the CDS Action Plan which covers the five-year period to 2016. Second, the
geographic scopes also differ. The two Northern Corridor studies deal primarily with just
 4

the Northern Corridor. The EAC Transport Strategy covers the entire area of the EAC and
not just the Northern and Central Corridors. The Core Strategic Network covers 15
corridors from the Horn of Africa to southern Africa.

Nathan Associates Inc. conducted both the CDS and the Definition and Investment
Strategy for a Core Strategic Transport Network for Eastern and Southern Africa study.
While there are some common elements, a much more in-depth analysis of the Northern
and Central Corridors was performed for the CDS project. For example, the Core
Strategic Network study only looked at one type of container movements as illustrative of
all cargo types whereas the CDS examined specifically heavy and light containers, dry
bulk, liquid bulk and general cargo. The objectives also differ in that the CDS focuses on
specific near-term improvements in the two corridor efficiency with development of
specific project profiles while the Core Strategic Network study has a much broader
regional perspective. The latter’s objective was to identify the strategic transport network
required for eastern and southern Africa to meet the trade projections up to 2030 and to
foster economic growth and regional integration of this region as a whole. The
investment plan was to address the overall network development and strengthening.
Thus the objectives are different. The two studies benefited from collaboration on
collection of baseline trade and traffic data and the preparation of trade and traffic
forecasts. While different, both studies benefited from the analysis done for the other and
the synergies between the two have enhanced both products.
 5

2.Northern Corridor Infrastructure

and Performance
This chapter presents the results of the diagnostic audit of the performance of the
Northern Corridor that was conducted from November 2009 through September 2010.
The diagnostic audit was performed using the software and audit methodology, FastPath,
to apply to transport logistics chains to measure performance (in terms of time, cost, and
reliability) and to identify bottlenecks and potential solutions2. The chapter commences
with a description of the Northern Corridor infrastructure and its conditions by mode.
This is followed by the diagnostic assessment of the corridor’s performance.

Infrastructure and Conditions

The Northern Corridor connects the Port of Mombasa to markets in Kenya, Uganda,
Rwanda and Burundi as well as southern Sudan, eastern DRC, and parts of northern
Tanzania (see Figure 2-1). It connects the entire East African Community to a major
regional port and for intra-regional trade and personal mobility. The road connects four of
the five East African Community (EAC) countries and is one of six strategic EAC
corridors. It also links the EAC to states on its periphery: Sudan, DRC and Ethiopia. It is
strategic because of the importance of the Port of Mombasa to the region. Despite its
centrality in regional development, there are still many facilitation problems.

2 FastPath is a proprietary diagnostic tool developed in a partnership between USAID and Nathan
Associates to analyze transport infrastructure and operational inefficiencies in the transport/logistics
chains serving import and export traffic. FastPath provides a quantitative basis for monitoring corridor
performance. The audit methodology consists of surveys and questionnaires to identify bottlenecks and
appropriate improvements to freight corridors.
 6

Figure 2-1
Northern Corridor Network

SUDAN To Juba
ETHIOPIA
To Juba
Lokichokio
Nimule
Northern Corridor Moyale
Lodwar
Gulu
Pakwach
Lira to Ethiopia

Soroti
KENYA
DRC Kumi
UGANDA Kamuli Mbale
Kitale
Luwero
Kisangani Fort Portal Jinja Tororo
Beni Kampala El Doret
Webuye
Kisumu
Kasindi Kaba Masaka Port Bell Malaba near Londiane
To Kisangani Mbarara
Nyanza
Entebbe Isiolo
Kamuganguzi Kisii
Thika
Gisenyi LA KE VICTORI A To Garissa and
Sirari
Walikale Nairobi Somalia
Kigali Musoma
Athi River
Goma
RWAND A Bunda
Rusumo
Mwanza Namanga
Bukavu near
Kayanza Mbuyuni Voi
Legend
Bujumbura BUR UND I
To Central Corridor
Corridor Highway and Railway To Central Corridor
Corridor Highway and P roposed Railway Improvement s Arusha
Corridor Highway TANZANIA
Feeder Roads - Exist ing To Central Corridor Mombassa
Feeder Roads – Planned / Proposed Im provement s
Ext ensions into DRC
Railway B order point
Count ry Border
Ferry Lines M ajor Cities/ Nodes

Source: Nathan Associates Inc.

MOMBASA PORT
As a multipurpose port, Mombasa handles containerized cargo, general cargo, dry bulk,
and liquid bulk. In 2009 the total throughput of the port was 19.1 million tons; throughput
grew at an average annual rate of 8.8 percent from 2002 to 2009. The predominant traffic
of the port is imports, which represent 86.6 percent of total traffic. For imports, 38.9
percent is liquid bulk, 28.1 percent is dry bulk, 24.7 percent is containerized cargo, and
only 8.2 percent is general cargo.

Exports through the Port of Mombasa were stagnant during the 2002–2009 period, with
an average annual increase of 0.4 percent. Transshipment represents a minimal portion of
the port traffic, with only 0.5 percent participation in 2009; moreover, the volumes of this
type of cargo have been shrinking markedly in the last five years (Table 2-1).
 7

Table 2-1
Mombasa Port Traffic, 2002-2009 (000s tons)

AAG
R
Type of 2002–
Cargo 2002 2003 2004 2005 2006 2007 2008 2009 2009

Imports

Containerized 1,624 2,228 2,599 2,645 2,970 3,761 3,959 4,086 14.1%
cargo

General cargo 1,196 1,209 1,236 1,009 1,129 1,105 1,020 1,349 1.7%

Dry bulk 1,098 1,404 1,588 2,128 2,344 2,722 2,891 4,641 22.9%

Liquid bulk 3,926 4,491 4,595 4,918 5,403 5,474 5,441 6,431 7.3%

Total 7,844 9,332 10,018 10,700 11,846 13,062 13,311 16,507 11.2%

Transit cargo 1,875a 2,186 2,590 3,202 4,347 4,042 4,471 3,612 13.7%

Exports

Containerized 1,466 1,135 1,669 1,680 1,625 1,934 1,996 1,952 4.2%
cargo

General cargo 241 208 198 139 185 168 299 269 1.6%

Dry bulk 464 380 381 286 313 205 200 62 -25.0%

Liquid bulk 209 271 246 173 132 167 190 167 -3.2%

Total 2,380 1,994 2,494 2,278 2,255 2,474 2,685 2,450 0.4%

Transit cargo 340 266 300 334 335 381 404 368 1.1%

Total imports 10,224 11,326 12,512 12,978 14,101 15,536 15,996 18,957 9.2%
and exports

Transshipmen 340 605 409 303 318 426 419 105 -15.5%
t

Total Traffic 10,564 11,931 12,921 13,281 14,419 15,962 16,415 19,062 8.8%

Container 305,427 380,353 438,597 436,671 479,355 585,367 615,733 618,816 10.6%
traffic (TEU)

a: Included in total cargo

Source Kenya Ports Authority

The main export commodities handled at the port are coffee, tea, and soda ash,
accounting for about 50 percent of total general cargo exports. In terms of general cargo
imports, the most important commodities are iron and steel, followed by plastic, rice,
vehicles, sugar, paper, and chemicals, with similar participation of 4–7 percent. Dry bulk
imports are dominated by maize, clinker, and wheat, which account for 81 percent of total
dry bulk imports. Finally, petroleum, oil, and lubricants represent 88 percent of liquid
bulk imports (Figure 2-2).

Almost 5 million tons of transit cargo was moved through the port in 2009 (Figure 2-3),
wit Uganda contributing 80 percent. By far the most important origin and destination of
transit cargo moved through Mombasa is Uganda, followed by DRC, Tanzania, and
Rwanda. Inbound and outbound transit flows with Tanzania have shrunk; imports to
Burundi and Somalia and exports from Rwanda have also decreased.
 8

Figure 2-2
Mombasa Port Traffic Composition by Commodity, 2009
General Cargo Export General Cargo Import Paper and Paper
Vehicles and Prod.
Sugar Chemicals Plastic 5%
Lorries
Cereals and 5% 4% 6%
5%
Grains Ceramic
Tea, 26% 11% 2%
Others, 40%
Iron and Steel
13%

Soda
Coffee, 16% Ash, 8% Others
49%

Fruits
Vegetables
and Juices, 3% Tobacco &
Cigarettes, 2%
Oil Seeds, 4%

Dry Bulk Import Liquid Bulk Import

Others, 5%
Others,
12%
Maize, 34%
Wheat, 23%

Other P.O.L., 88%

Cereals, 2% Clinker, 24%
Coal , 3%

Fertilizer, 8%

Source: Kenya Port Authority

Figure 2-3
Mombasa Port Transit Traffic, 2009 (percent)

Somalia
Burundi
0%
1% Rwanda Sudan D.R.C.
Tanzania 5% 3% 6% Others
5% 0%

Uganda
80%

Source: Kenya Port Authority

The layout of Mombasa Port is presented in Figure 2-4, and the characteristics of the port
are presented in Table 2-2. The main physical constraint at the port is the access channel,
which is narrow (200 m) and shallow (approximately 13.7 m). Nevertheless, there are
plans to widen and deepen the channel, to construct an additional new container terminal
at Kipevu West and to establish a petroleum terminal just down the coast where the water
is deeper and to relocate the tank farm further from the city with safety and
environmental benefits. Funds have already been secured for the new container terminal
which will have three berths of 900 meters and 100 hectares of yard space.
 9

Figure 2-4
Current Layout of Mombasa Port
 10

Table 2-2
Characteristics of Mombasa Port

Item Description

Natural catchment area Kenya, Uganda, Sudan, Great Lakes region and Southern
Ethiopia

Total freight volume ( import and 19 mtpa in 2009

export)

No of berths, depths 16, 10.0m

Container berths 5, total length 964m

Container equipment , capacity 4 x 40t gantry cranes, full capacity

Total container volume (import and 619,000 TEU in 2009

export)

Bulk berths and equipment 17 cranes, 5t to 20t

Marine access Channel 15km long, 13.7m deep, tide 2.5 to 4m

Road access Poor, congested

Rail access Via RVR

Current operational status Fully operational, congested, only port serving Kenya

Problems Container dwell time, port congestion, recently improved

Planned development 70 percent of all cargo containerized; planned expansion

of container terminal, improved road and rail access.
Possible additional port at Lamu

Intervention / assistance required No plans yet for container terminal privatization

Source: Nathan Associates Inc.

Containers are handled in Mombasa in two types of facilities: (1) specialized container
terminals and (2) conventional terminals. The conventional terminals also handle other,
non–container cargoes. The specialized terminals handle about 70–80 percent of the total
container throughput. Containers are not handled by direct delivery. The containers are
first stored in container yards, stay several days inside the terminals and only then, are
usually released.

Mombasa’s specialized container terminal (Kipevu West), Berths 16–18, consists of:

• 650 m of marginal berthage with 10.2 m depth CD alongside and about 15 ha of

backup area

• Four gantry, STS cranes

• RTG-based container yard

• Back of terminal intermodal yard with two RMGs

The conventional terminal in Mombasa includes Berths 11–14 with a total of about 800 m
of berthing length and a depth alongside of about 10 meters. This terminal also handles
general cargo. Berths 13–14 are used exclusively for containers, mostly those of one
shipping line (Maersk). All container handling in Mombasa’s conventional terminal is by
ship’s gear. Mombasa has only one mobile harbor crane, but it is not presently used for
ship handling.
 11

Traffic of containerized cargo reached 619,000 TEU in 2009 (Table 2-3). Preliminary data
indicate that container traffic increased by 13 percent in 2010. Empty container traffic is
significant—34.6 of total TEU handled at the port. This reflects the imbalance between
imports and exports flowing through the port.

Table 2-3
Mombasa Port Container Traffic, 2003–2009 (TEU)
AAGR
Type 2003 2004 2005 2006 2007 2008 2009 2003-2009
Imports
Full 159.0 190.0 193.2 217.9 277.8 292.3 301.5 7.7%
Empty 14.0 14.0 14.6 11.6 4.2 5.1 6.4 -12.8%
Exports
Full 78.0 91.0 94.1 86.3 101.3 102.9 95.8 0.3%
Empty 79.0 110.0 107.5 132.2 165.5 181.0 205.6 11.4%
Transhipment
Full 44.0 29.0 22.3 21.8 30.5 30.3 7.4 -16.8%
Empty 6.0 5.0 5.0 9.5 6.0 4.2 2.1 -13.3%
Total
Full 281.0 310.0 309.7 326.0 409.6 425.5 404.7 4.6%
Empty 99.0 129.0 127.0 153.3 175.8 190.2 214.1 9.1%

Grand Total 380.0 439.0 436.7 479.4 585.4 615.7 618.8 6.0%
Source: Kenya Port Authority

Mombasa container terminal is not designed according to the specifications of modern

container terminals. The width is about 250 m, while modern terminals’ width is usually
400–500 m. As a result, the backup area is limited. Moreover, there is no practical way of
expanding the terminal areas because the marine port facilities are cordoned by the city or
other private facilities. The small backup area provides for a relatively small container
yard. The resulting shortage in container yard is the main source of terminal congestion in
the port.

A related and even more severe problem is traffic congestion inside and outside the
terminal. The container yard seems to have difficulties in serving ship and gate traffic at
the same time. During our visits at the terminal we observed long lines of trucks waiting
inside the terminal and at both out and in gates. The result is that the STS cranes often
wait for yard tractors, a major factor of low crane productivity and subsequently low
berth productivity.

CFS (or ICDs) were first permitted in Mombasa in 2007. Mombasa now has 17 CFS; about
half of them handle containers, but only seven handle import containers.

ROAD SYSTEM
The trunk road network of the Northern Corridor that stretches from Mombasa to
Bujumbura via Malaba is 1,970 km and to Goma is 1,846 km. An assessment of the
Northern Corridor road network was carried out by Aurecon for the East African
Transport Strategy and Regional Road Sector Development Program conducted for the
 12

EAC in 2010. This assessment consisted of two major elements: road capacity and road
condition.

Road Capacity and Other Characteristics

The evaluation of road capacity was based on level of service standards defined in
Aurecon’s First Order Network Assessment (FONA) model developed based on the
Highway Capacity Manual (Transportation Research Board, 2000). Level of service (LOS)
with indices ranging from A (best operating conditions) to F (worst operating conditions).
The best operating conditions entail free flow high (design) average speeds and able to
overtake easily. The road capacity of the Northern Corridor in terms of LOS is presented
in Figure 2-5. Approximately 22 percent of the trunk road is rated at a LOS of C or better;
38 percent of the road was rated at a LOS of D, while 45 percent of the road was rated
poor at a LOS of E or F.

Figure 2-5
Characteristics of the Northern Corridor Road Network

Note: traffic volumes are for the 30th highest hourly volume per direction.
Source: Aurecon, East African Transport Strategy and Regional Road Sector Development Program, 2010.

Road Conditions

Data obtained from primary and secondary sources were used to determine the current
condition status of the pavement structures of this EAC corridor (see Figure 2-6). The first
and foremost indicator of the pavements’ condition was pavement roughness, also
referred to as riding quality. This objective measurement describes the distortion of the
pavement surface that contributes to an undesirable or uncomfortable ride. The unit for
roughness is the International Roughness Index (IRI) ranging between 0 (good) to 20 (very
poor).
 13

• Paved roads are typically maintained at roughness levels between 2 and 6

IRI. These roads require no immediate remedial action and are considered to
be in a sound state.

• Paved roads that are approaching a severe state have typical roughness
levels between 6 and 10 IRI. These roads are in warning state.

• Paved roads in a severe condition, requiring immediate remedial action have

typical roughness levels above 10 IRI.

Figure 2-6
Condition of Northern Corridors Roads

Source: Aurecon, East African Transport Strategy and Regional Road Sector Development Program, 2010.

RAIL SYSTEM
The Northern Corridor rail system (Figure 2-7) operates within Kenya and Uganda as a
narrow gauge (1,000 mm) system, compatible with the Tanzania Railway Limited (TRL)
system on the central corridor in Tanzania. The line extends from the port of Mombasa to
Nairobi, and further to Malaba, connecting to the Ugandan rail system serving Kampala
and on to Kasese close to the DRC border. There are several spurs, the most important
being the line to Kisumu on Lake Victoria, and the spur to Magadi Soda south of Nairobi.
The rail link to Tanzania is closed, because of low traffic demand. This is also the case for
the line between Kampala and Kasese, and the northern Ugandan line from Tororo
through Gulu to Pakwach on Lake Albert, which has a road /rail bridge across the Nile.
Rebel activity is also partly responsible for closure of this line, which was built as recently
as the 1960s.
 14

Figure 2-7
Northern and Central Corridor Rail Systems

Source: Prepared by Nathan Associates Inc.

The condition of the Northern Corridor railway track is presented in Table 2-4. The poor
condition of the track has lead to imposition of temporary speed restrictions on many
sections across the track, resulting in about 20 derailments per month and unpredictable
transit times.

Table 2-4
Condition of Northern Corridor Railways Tracks
Length Condition of Track and
Section (km) Rail Weight Needed Intervention
KENYA
Mombasa-Nairobi 530 Good/Fair: 95 lb/yard Spot rehabilitation
Replacement of rails and slippers
Nairobi-Malaba 550 Good/Fair: 80 lb/yard Replacement of rails and slippers
Reconstruction of culverts
Nakuru-Kisumu 217 Fair/poor: 80 lb/yard (60 Improvement of track of 160 km
km) and 60 lb/yard (160 km) Reconstruction of culverts and
viaducts
UGANDA
Malaba-Kampala 250 Fair/poor Rehabilitation of the line including
bridges
Port Bell-Kampala 10 Good
Kampala-Kasese 332 Poor Rehabilitation
Source: NCIMPS, Interim Report.

RVR inherited 39 mainline (Class 93/94) diesel electric locomotives from KRC, which
form the core of the mainline fleet. These locomotives are North American GE U26Cs,
fitted with 2,600 hp engines. A total of 26 were built in 1977 and the remainder in 1987 or
later. The bulk of the mainline fleet is therefore 37 years old, but remains serviceable and
 15

suitable for rehabilitation and upgrading. In southern Africa, many mainline locomotives
still in service are more than 50 years old.

On the RVR Uganda section between Malaba and Kampala, the mainline locomotives are
much smaller, similar to those used on the TRL system in Tanzania, 1200hp. During the
1980’s the Nalukolongo railway workshop near Kampala was equipped and upgraded
through a €40 million program by KfW, and it is well qualified to carry out full
refurbishment of the Uganda locomotives, subject to financing being available. The longer
term objective would be to replace the Uganda locomotives with larger units similar to
those operated in Kenya, to allow for seamless railway operations.

LAKE TRANSPORT
A description and assessment of the lake ports and transport on Lakes Tanganyika and
Victoria that serves both corridors is presented in Chapter 3 on the Central Corridor.

BORDER CROSSINGS
Border crossings in the region are characterized by poor infrastructure, inadequate
coordination and congestion. The busiest and most congested border on the route is at
Malaba between Kenya and Uganda. One stop border post (OSBP) operations are being
introduced on all the Northern Corridor borders with support from the World Bank and
African Development Bank as part of the East Africa Trade and Transport Facilitation
Project. Under this project, the World Bank is supporting new border facilities at Malaba
and Gatuna/Katuna on the Uganda/Rwanda border and the African Development Bank
is supporting feasibility studies for OSBP at Akinyaru/Kinyaru Haut on the
Rwanda/Burundi border, Gisenyi/Goma on the Rwanda/DRC border and
Mpondwe/Kasindi on the Uganda/DRC border. The regional OSBP legal framework
being developed by the East Africa Community with support from JICA provides the
legal jurisdiction and structure, operating principles and methods of coordination. The
approval process has involved all border agencies as has the joint planning for the new
OSBP border facilities. Continuing support for this coordination is critical.

Figure 2-8
Gisenyi/Goma Border Crossing
Cargo clearance can be done at the border, but
in most cases is done at inland clearance
centers, most in capital cities. Where
clearances are not done at the border, the
border clearance is generally done in a few
hours. Nevertheless, the clearance process is
not complete and the 1-3 day final clearance at
inland centers should be seen as part of the
overall process. In the following discussion of
corridor performance, the term border is used
to describe both cost and time spent at the border plus the average time at the final inland
clearance point. In terms of improving facilitation on the Northern Corridor, both control
points are important.
 16

Most of the trucks operating on the route are Kenyan-owned since it is easier for them to
arrange cargo from the port and then seek return hauls in the other countries.
Nevertheless, the cargo is significantly imbalanced in favor of imports and many return
hauls are empty. The Kenyan road transporters have a very active association, the Kenya
Transport Association, which represents their interests at the port and with government
agencies concerning the regulations that affect their operations. Freight forwarders are
represented with national and regional associations. These associations will be important
“co-drivers” for more effective transport facilitation measures on the Corridor.

Corridor Performance by Component

The performance assessment provides a framework for the detailed analysis conducted
through the use of our logistics toolbox, FastPath. This is done based on three variables
that define the performance of transportation networks: price (as experienced by the
shippers of cargo - producers and importers), time and the reliability of completing the
shipment.

For analysis purposes we defined the Northern Corridor as in Figure 2-9. The main
origins/destinations of cargo are the port of Mombasa, Nairobi, Kampala, Kigali and
Bujumbura along the main corridor. Additional origins/destinations are Goma and
Kasindi (access to eastern DRC) and Nimule (access to southern Sudan). These
origins/destinations were selected on the basis of their importance as population and
industrial centers as well as consolidation and redistribution centers.

The transport network is divided into nodes and links each representing different
physical and operational characteristics. The nodes represent the port, ICDs, border posts,
lake ports and regular nodes that are necessary to separate links with different
characteristics. The port node contains information regarding five elements within the
ports: the channel, the berth, the yard, customs clearance and the gate. Other nodes
contain information specific to their physical characteristics and their operations. The
links represent road, rail and maritime segments with unique characteristics. They contain
modal information on capacity, topography, price and travel time that defines its
performance.
 17

Figure 2-9
Links and Nodes Schematics of the Northern Corridor

Source: Prepared by Nathan Associates Inc.

In order to organize and verify the information that was introduced to the FastPath model
a series of tables were prepared with the information required to simulate the different
elements of the logistics chain. As mentioned previously, the logistics chain is organized
in nodes and links that represent all the relevant elements.

The nodes that were analyzed for the project are the port, ICD, border posts, lake ports
and inland clearance. The links that were analyzed are road, rail and lake segments.

Generally discussions are made on the performance of the logistics chain for 20 foot light
containers as indicative of the processes. A discussion of the performance of other
commodities is presented in the Overview of Corridor Performance. Whenever relevant,
specific comments have been made on different performance for other commodities.

PORTS
Analysis has been made based on elements that represent several stages of the cargo
processing at the port, comprising the port channel, the berth, storage-yard, customs,
terminal handling and the gate. Understanding that several activities take place at the
same time and not sequentially, we have distributed the cost and time among these
elements such that the totals match what was reported. The information is consolidated
to represent the three variables used to assess performance: price, time and reliability
(measured as the range of time in which an activity can be completed).

Table 2-5 shows the input information for the import and export of 20 ft light containers.
For example, it costs US$ 297 and it usually takes an average 217 hours to complete the
 18

process to import a light container at the port of Mombasa. The process could be
completed in as little as 73 hours or as much as 362 hours. When looking at the individual
elements it can be seen that the terminal handling costs US$ 162, takes 24 hours to
complete and this time has a range between 4 and 48 hours.

Table 2-5
Port Input for the Import and Export of Transit 20 ft Light Containers
Price per Unit Average Time Max. Time Min. Time
Mombasa (US$) (hours) (hours) (hours)
Import Export Import Export Import Export Import Export
Port Channel -- -- 48 -- 72 -- -- --
Berth 60 60 48 48 72 72 24 24
Storage - Yard -- -- 48 192 72 648 24 72
Customs and Agents 75 75 48 48 96 72 24 24
Terminal Handling 162 125 24 24 48 48 -- --
Gate -- -- 1 1 2 2 1 1
Total 297 260 217 313 362 842 73 121
Source: Prepared by Nathan Associates Inc.

ICD IMPORTS (DOMESTIC CFS)

The container imports for the domestic market are transferred from the port to a
Container Freight Station (CFS). FastPath has an Inland Container Depot type node that
was used to model the processing of containers at the CFS. Table 2-6 shows the five
elements considered for the ICD type nodes. The information is organized in similar
fashion to the information discussed for the port above.

Table 2-6
Nairobi ICD Input for 20ft Light Containers

Price per Average Max. Time Min. Time

Nairobi ICD
Trip (US$) Time (hours) (hours) (hours)
Transfer 150 3 5 1
Customs 300 192 400 48
ICD Handling 110 200 48 48
Storage Costs -- -- -- --
Gate -- 1 2 1
Total 560 396 455 98
Source: Prepared by Nathan Associates Inc.

BORDER POST
The border posts are another important node along the logistics chain. Customs clearance
at the border can represent significant delays. There are two components that are
analyzed within a border post: immigration and customs. As can be seen in Table 2-7, 25
hours of the total 26 hours spent at the Malaba Border Post is for customs processing.
 19

Table 2-7
Border Post Input for 20ft Light Containers
Price per Average Max. Time Min. Time
Malaba
Trip (US$) Time (hours) (hours) (hours)
Immigration -- 1 1.5 1
Customs -- 25 30 1
Total -- 26 32 1
Source: Prepared by Nathan Associates Inc.

ROAD
Each road link contains information pertaining to the physical characteristics of the road
segment as well as price, time and reliability. The physical information relates to its
distance, the type of terrain (flat, rolling, hilly and mountainous), surface condition (good,
fair and bad) as well as congestion level (congested and not congested). This information
is used to estimate a factor that is used to provide a weight to distribute the cost among
the road links for each road transport alternative. The performance information includes
the cost as a total for the link or per km, total time in the link (including wait time), wait
time (including rest stops), and the maximum and minimum speeds and wait times.

Table 2-8 shows the road link information between Mombasa and Kigali for import of 20ft
light containers. The table shows that the most expensive road segment is between
Nairobi and Eldoret which is the result of a combination of difficult terrain and
congestion.

Table 2-8
Road Input for 20ft Light Containers

Ave. Trip Ave. Wait Max. Min. Max. Wait Min. Wait
Distance Cost
Segment Terrain Condition Congestion Time Time Speed Speed Time Time
(km.) (TEU/km)
(hours) (hours) (km/hr) (km/hr) (hours) (hours)

Mombasa-Nairobi 480 F to H F H 2.42 25 13 60 30 19.5 0

Nairobi-Eldoret 327 H to M F H 3.05 18 10 60 30 15 8
Eldoret-Webuye 67 H F H 2.63 3 1 60 30 1.5 0
Webuye-Malaba 67 H F H 2.63 13 11 60 30 16.5 8
Malaba-Tororo 20 H F H 2.63 1.1 0.5 60 30 0.75 0
Tororo-Kampala 219 F F H 2.10 20 14 60 30 21 0
Kampala-Gatuna 411 H F M 1.16 23 12 60 30 18 8
Gatuna-Kigali 70 H to M F M 1.47 2 0 60 30 0 0
Total 1661 132.1 61.5
Source: Prepared by Nathan Associates Inc.

RAIL
Similarly to the road links, the rail links contain information pertaining to the physical
characteristics of the rail segment as well as price, time and reliability. The physical
information relates to its distance, the type of terrain (flat, rolling, hilly and mountainous),
and track condition (good, fair and bad) as well as number of tracks. This information is
used to estimate a factor that is used to provide a weight to distribute the cost among the
links for each road transport alternative. The performance information includes the cost
as a total for the link or per km, total time in the link (including wait time), wait time
(including rest stops), and the maximum and minimum speeds and wait times.
 20

Table 2-9 shows the rail link information between Mombasa and Nairobi for import of
20ft light containers. The table shows that the most difficult terrain is between Voi and
Nairobi.

Table 2-9
Rail Input for 20ft Light Containers
Ave. Trip Ave. Wait Max. Min. Max. Wait Min. Wait
Distance No. Cost
Segment Terrain Condition Time Time Speed Speed Time Time
(km.) Tracks (TEU/km)
(hours) (hours) (km/hr) (km/hr) (hours) (hours)
Mombasa-Voi 155 F P 1 1.21 30 22 40 10 76 6
Voi-Nairobi 334 H P 1 1.21 66 48 40 10 164 14
Total 489 96 70
Source: Prepared by Nathan Associates Inc.

Overview of Northern Corridor Performance

Once all the information is introduced and all checks are completed the FastPath model
produces summaries of the corridor level performance which can be drilled down for
further analysis. The summaries are produced for imports and exports for each of the
commodity types and transport alternatives analyzed.

IMPORTS
Table 2-10 shows the price, time and reliability of each of the destinations from the port of
Mombasa for imports of different handling types of cargo served by road. The reliability
indicator reflects the range of variations in time with respect to the average time it takes to
complete each stage of the logistics chain. A higher value for the reliability indicator
signifies a greater variation and more likelyhood of long delays. For nodes, a reliability
score of 0-40 is Good, 40-90 Fair, 90-150 Poor, and 150-400 Very Poor. For links, the
reliabilyt scores are 5-100 Good, 100-200 Fair,, 200-300 Poor, and 300-500 Very Poor.

Table 2-10 shows, for example, that for dry bulk going to Bujumbura the total price is US$
8,511 per truck (US$ 360 at the port), it takes 364 hours to complete the trip (170 hours at
the port) and has a reliability indicator of an average 200 percent (424 percent at the port).
Generally, the price for heavy containers, dry and liquid bulk is similar. As expected,
Table 2-10 shows that the price goes up with distance (lowest rate per km is to Kampala at
US$ 1.78/km for light containers). But it also shows that there are destinations with
higher rates due to dangerous conditions (Nimule at US$ 3.53/km for light containers)
and destinations with extensive delays to clear customs while the cargo remains loaded in
the truck (Bujumbura, Goma and Kasindi at US$ 2.60, US$ 2.66 a US$ 2.97/km
respectively).
 21

Table 2-10
Northern Corridor Performance for Imports by Cargo Type and Destination, 2010 (via road)
Price (US$) Time (hours) Reliability Indicator (%)
Distance Containers Bulk Containers Bulk Containers Bulk
Destination
km. Light / Light /
Light Heavy Dry Liquid Heavy Dry Liquid Heavy Dry Liquid
Nairobi 480 1,396 1,895 1,530 1,365 396 181 145 158 377 359
Kampala 1,180 2,099 3,448 3,511 3,316 323 276 240 194 262 217
Kigali 1,661 3,901 6,595 6,658 6,463 376 329 293 167 220 178
Bujumbura 1,903 4,950 8,448 8,511 8,316 411 364 328 153 200 160
Nimule 1,526 5,383 7,697 7,760 7,565 381 334 274 165 217 190
Kasindi 1,623 4,825 9,635 9,698 9,503 372 325 289 168 223 180
Goma 1,811 4,822 8,137 8,200 8,005 537 490 454 131 162 135
Port Node*
Mombasa - Domestic 315 315 330 165 217 170 134 287 400 386
Mombasa - Transit 297 297 360 165 217 170 134 287 424 386
Note: Port values are included in the totals shown for each destination.

Source: Nathan Associates

Total travel time varies by destination depending on the number of border crossing and
the delays experienced at final clearance. The time at the port for containers is longer than
for bulk because the bulk is generally loaded into trucks at the quay, cleared customs and
taken out of the port immediately. Regarding the average travel speed for the shipment
from the port to the destination (excluding the time spent in the port) the route to
Kampala is the fastest (one border post) followed by Kigali and Kasindi (two border
posts). Bujumbura (three border posts) and Nimule (two border posts) have slower border
posts and inland clearance. The slowest trip is to Goma (three border posts) where cargo
has to wait about two weeks to be cleared.

In terms of reliability, the port has the greatest range of variation in time in the logistics
chain hence the most unreliable. Generally, road transport is the most reliable element of
the transport logistics chain. As a result, the longer the travel distance the lower is the
overall reliability indicator since the relative weight of the road transport reliability index
increases.

Table 2-11 presents similar performance results of imports that use rail along the
Northern Corridor. The average cost per km to Kampala (US$ 1.72/km for a 20 ft light
container) is slightly cheaper than to Nairobi (US$ 1.91/km). The rail rate to Kampala is
slightly lower than the road rate (difference of US$ 0.06 per km) which confirms RVR
strategy to maximize revenue of cargo they can effectively carry (given the current
infrastructure and equipment constraints) by setting their rates slightly lower than the
road transport. In terms of time, the time by road is faster for both Nairobi and Kampala.
 22

Table 2-11
Northern Corridor Performance for Imports by Cargo Type and Destination, 2010 (via rail)

Distance Price (US$) Time (hours) Reliability Indicator (%)

Destination Containers Bulk Containers Bulk Containers Bulk
km.
Light Heavy Dry Liquid Light Heavy Dry Liquid Light Heavy Dry Liquid
Nairobi 489 935 1,479 1,494 1,329 316 316 269 233 202 202 257 229
Kampala 1,200 2,059 3,369 3,432 3,237 462 281 415 379 138 222 177 141
Port Node* 0 0 0 0
Mombasa - Domestic 315 315 330 165 217 217 170 134 287 287 400 386
Mombasa - Transit 297 297 360 165 217 217 170 134 287 287 424 386
Note: Port values are included in the totals shown for each destination.

Source: Nathan Associates Inc.

EXPORTS
For exports, similar tables have been prepared. Table 2-12 shows that for the export flows
via road the cheapest rates are also for Kampala (US$ 1.75/km) and then Nairobi (US$
2.02/km). These are the shortest and involve fewer delays because they only experience
one border post (Malaba). The most expensive are Kasindi and Nimule that involve
dangerous conditions and delays in clearance. In terms of time to complete the shipment
Kasindi, Bujumbura, Nimule and Goma take about the same time. Considering the
distances traveled Nimule and Kasindi are the most inefficient considering road
conditions and border delays. The reliability indicator shows that the shortest trips are the
most unreliable given that the impact of the port unreliability is more significant.
Variations in reliability of border crossing are also reflected in the results.

Table 2-12
Northern Corridor Performance for Exports by Cargo Type and Origin, 2010 (via road)
Reliability
Price (US$)
Distance Time Indicator (%)
Origin
km. Containers (hours) Containers
Light Heavy Light Heavy
Nairobi 480 971 1,500 324 326 343
Kampala 1180 2,062 3,441 395 267 353
Kigali 1661 3,864 6,588 422 250 261
Bujumbura 1903 4,913 8,441 433 244 255
Nimule 1526 5,346 7,690 431 245 256
Kasindi 1623 7,291 9,628 436 242 253
Goma 1811 4,785 8,113 429 246 257
Port Node*
Mombasa - Domestic 270 300 313 336 354
Mombasa - Transit 260 290 313 336 351
Note: Port values are included in the totals shown for each origin.

Source: Nathan Associates Inc.

For exports via rail, Table 2-13 shows that the transport rate for Kampala (US$ 1.69/km
for a light container) is slightly lower than for Nairobi (US$ 1.82/km). In terms of average
speed (total travel time excluding the time in the port), they are quite similar with Narobi
slightly faster (US$ 4.95 km/hr) but overall quite slow. The shipment takes almost three
times longer via rail than via road to Kampala and is only six cents cheaper per kilometer.
 23

Table 2-13
Northern Corridor Performance for Exports by Cargo Type and Origin, 2010 (via rail)
Reliability
Price (US$) Time (hours)
Distance Indicator (%)
Origin
km. Containers Containers Containers
Light Heavy Light Heavy Light Heavy
Nairobi 489 890 1,464 412 390 258 286
Kampala 1,200 2,022 3,362 558 605 191 260
Port Node*
Mombasa - Domestic 270 300 313 313 336 354
Mombasa - Transit 260 290 313 361 336 434
Note: Port values are included in the totals shown for each origin.
Source: Nathan Associates Inc.

Comparing imports to exports shows that light container exports from Nairobi by road
are 30 percent cheaper and 18 percent faster. In contrast, exports by rail are 5 percent
cheaper and 40 percent slower. The port charges are lower for exports (14 percent) while
the processing time is longer (44 percent).

Cost and Time Comparison by Transport Alternatives

This section presents the results of the performance assessment for light containers which
are generally indicative of results for other cargo types. The results are presented for
imports/exports for the selected transport alternatives connecting each origin/destination
and the port of Mombasa. The figures show the participation of each component (links
and nodes) in the total costs and time for respective transport alternative.3

IMPORTS
Two transport alternatives were considered for the segments between Mombasa and
Nairobi, one via road and one via rail. Figure 2-10 shows that the rail alternative is less
expensive and faster than the road alternative. This is mostly due to how the customs
clearance at the port is handled. The containers that are transported by rail are identified
when offloading from the ship and immediately transported to the rail yard for loading
into a train along with the manifest. Customs is cleared at the ICD in Nairobi given KRA
allows direct bill of lading to the ICD (it may be considered highly secure given that the
ICD is operated by KPA and containers are more secure than on trucks). In terms of total
cost (including freight forwarding and extra inventory costs) the rail connection to
Nairobi is 19 percent lower than the road and in terms of time rail is 20 percent quicker
that the road. The combination of port and ICD costs account for 50 percent in the road
option and 34 percent in the rail option; the remaining costs of both alternatives are
related entirely to the surface transport cost. Time at the port and ICD for containers
transported by road is 97 percent of the total time, while via rail is 69 percent.

3 The tables present the actual values of each component and include the estimated facilitation and extra
inventory costs. The extra inventory cost is the estimated value of additional goods that corridor users
have to move through the system, in order to maintain an uninterrupted supply / provision for their
regular operations. All percentages in the figures are based on transport costs only.
 24

Figure 2-10
Cost and Time for Northern Corridor Destinations Served by Road and Rail Transport, Imports,
2010 (light containers)

Source: Nathan Associates Inc.

There are also two transport alternatives between Mombasa and Kampala, one via road
and one via rail. The rail connection is slightly less expensive despite the higher extra
inventory cost associated with the unreliability of rail service. In terms of time, the rail
alternative takes 43 percent longer than the road alternative. In terms of distribution of
cost and time, the port’s share of the total cost is reduced compared to that shown above
for Nairobi. The port now represents 14 percent of the cost for the road connection and 14
percent for the rail. With respect to time, the port represents 67 percent and the Malaba
border post 8 percent for the road connection while the port represents 47 percent for the
rail connection. This is due to the increased cost and time taken up by the longer land
transport component to Kampala.

Figure 2-11 presents the results for destinations served only by road. When looking at the
total cost, the most expensive destination is Nimule due to higher rates to account for
security risks between Nimule and southern Sudan. Other expensive destinations are
Goma and Bujumbura where trucks are required to wait while the cargo is cleared for up
to a week. For the Mombasa–Kigali pair, Figure 2-11 shows that the port only represents 8
percent of the transport cost while still taking up most of the time with a 58 percent share.
This cost distribution is very similar for Bujumbura, Nimule, Kasindi and Goma. In terms
of time, the port share decreases in cases where the border and inland clearance is large.
Thus the port share of total transport time to Bujumbura is 53 percent, Nimule (57
percent) and Goma (40 percent). Long inland clearance times at Goma and Bujumbura are
due to delays of up to a week to clear the cargo. The delays also have significant cost
implications because the trucks are required to remain loaded while the clearance is
completed. On the graph border represents both the time spent at the border and at the
inland clearance office.
 25

Figure 2-11
Cost and Time for Northern Corridor Destinations Served Only by Road Transport, Imports, 2010
(light containers)

EXPORTS
Figure 2-12 presents the cost and time distribution for export flows. It can be seen that the
rail alternative to export containers from Nairobi is slightly less expensive (3 percent) and
slower (27 percent). In terms of the cost and time distribution, the port has a similar share
for road and rail alternatives with 28 and 30 percent, respectively. Land transport makes
up the remaining shares. In terms of time, the port takes up 97 percent of the total time for
the road alternative while it takes 76 percent for rail.

Similarly for the export of containers from Kampala, the rail connection is less expensive
(5 percent) and slower (41 percent). As a result of the longer distances, the cost
distribution changes with the port taking 13 and 14 percent for road and rail alternatives,
 26

respectively. The port share of the time also is reduced although it still is quite significant
at 79 percent for road alternative and 56 percent for rail.

Figure 2-12
Cost and Time for Northern Corridor Origins Served by Road and Rail Transport Alternatives,
Exports, 2010 (light containers)

Source: Nathan Associates Inc.

Figure 2-13 shows the results for origins served only by road for exports. When looking at
the total cost, the most expensive origins are Kasindi due to low volumes and Nimule due
to higher rates to account for security risks. Other less expensive origins are Goma and
Bujumbura due to their distance from the port and with Kigali being the lowest. For the
Kigali- Mombasa pair, Figure 2-10 shows that the port only represents 7 percent of the
transport cost while still taking up most of the time with a 75 percent share. This cost
distribution is very similar for the Bujumbura, Nimule, Kasindi and Goma. In terms of
time the port share is also very similar for all origins because the impact of the border and
inland clearance is minimal.
 27

Figure 2-13
Cost and Time for Selected Northern Corridor Origins Served by Road Transport - Exports, 2010
(light containers)

Source: Nathan Associates Inc.

 28

Interpretation of Results

PORT OF MOMBASA
The analysis of all the different transport alternatives between the selected origins and
destinations for the exports and imports along the Northern Corridor show consistently
that the greatest share of the time is spent at the port of Mombasa.

Table 2-14 presents a further breakdown of the diagnostic assessment of the different
components of the port node for both imports and exports. The results for imports show
that containerized cargo spends most of the time in the yard and this component is also
the most expensive. The components with the next share in time are the channel, the berth
and customs clearance. For exports, the yard is also the most significant component
followed by the berth and customs.

Table 2-14
Mombasa Port Performance (light containers)
Imports – Light Containers Exports – Light Containers
Price Time Reliability Price Time Reliability
Component (US$) (hrs) (%) (US$) (hrs) (%)
Mombasa Port 297 217 287 260 313 336
Channel 0 48 150 0 0 0
Berth 60 48 100 60 48 100
Yard 162 72 133 125 216 289
Customs 75 48 150 75 48 100
Gate 0 1 100 0 1 100
Source: Nathan Associates

Ship waiting in Mombasa is often three to four days. Crane productivity at the specialized
terminal was about 10 moves/crane–hour. Since ships were mostly served by one crane,
this also was the berth productivity. Larger ships, with 1,500 moves/call, are served part
of the time by two cranes, reaching berth productivity of 15 moves/berth–hour. Berth
productivity at the conventional terminal was not much different than that at the
specialized terminal, since ships worked with their onboard cranes, usually three or four
cranes at the same time, each achieving about four moves/hour. The resulting berth
productivity was 13–14 moves/berth–hour4. The reasons for the low productivity
indicated by Mombasa lines are yard congestion, traffic jam inside the terminal,
equipment breakdown, shortage of equipment, lack of modern Terminal Operating
System (TOS) and labor motivation. 5

LAND TRANSPORT
There are potential cost and time advantages for using rail alternative where it is
available. However, poor performance and inadequate rail capacity has led to most

4 More recent observations, in October 2010, indicated berth productivity as low as 10 moves/hour.
5 A more detailed description of the current port performance in the CDS Technical Paper E. on Integration
of Ports and ICDs.
 29

shippers (over 90 percent) using road. There is urgent need to rebuild and further develop
rail capacity not only to provide effective competition with road but to increase use of rail
with a view to reducing the region’s total transport and trade cost.

OTHER CAUSES OF INEFFICIENCY

As highlighted in this diagnostic assessment the performance of the Northern Corridor is
affected by numerous operational, policy, procedural, and administrative issues. These
are summarized below and strategies for addressing these causes of inefficiency are
presented in Chapter 5.

In Kenya, vehicles licensed for transit cannot carry domestic cargo and must use
prescribed transit routes. This has the effect of many return trips being empty. Similarly in
Tanzania, the Revenue Authority licenses trucks for transit or domestic with the same
effect.

Domestic road transport policies in all states are aimed at deregulating market access,
which has had some positive effects, but the lack of qualitative regulation has also had
several undesirable consequences. These include low entry barriers leading to cut throat
competition, low safety levels and poor service quality.

Existing overloading control strategy is aimed at achieving 100 percent inspection of all
commercial vehicles. There is no targeted risk management approach and no incentive to
encourage truckers to self-regulate. The high intensity of checking increases journey times
and provides an added incentive for corruption. Differences in national limits complicate
cross-border operations. There is also no regional consistency in terms of the frequency of
checks as some states (Burundi, Rwanda) have no existing weighbridge infrastructure.

The Northern Corridor, as is the case for Central Corridor, suffers from serious delays
caused by informal stops and check points on the route. Some are officially sanctioned
and some are created to collect payments to police, transit authorities and local
communities. Without sufficient law enforcement vehicles, stationary control points to
check for driving licenses, vehicle registration, vehicle road worthiness certificates and to
inspect vehicles for contraband and trafficking are essential. Nevertheless, unofficial stops
delay transit transport and add cost to transport which is passed on to the shipper. In
other cases, they are payments to avoid regulatory control, such as payments especially
on the Northern Corridor to avoid overloading regulation.

Insufficient use is made of customs tools to expedite processing. Clearance modernization

is being implemented at the national level and the extent of implementation is varied.
Tools include risk management, accredited economic operators, customs bonds and
control points, preclearance and so forth.

Failure to implement an effective transit regime impedes transit movement in terms of

cost, time and reliability. Many aspects of a transit regime exist, but have not been fully
implemented. Common vehicle regulations have been issued, but not fully implemented
and there are current efforts to change again. Road worthiness standards have been
promoted, but there is lack of trust in the systems of other EAC partner states. Customs
declaration have been simplified and harmonized, but each country still requires its own
form under national insignia.
 30

3. Central Corridor Infrastructure

and Performance
This chapter presents the results of the diagnostic audit of the performance of the Central
Corridor that was conducted from November 2009 through September 2010. The
diagnostic audit was performed using the software and audit methodology called
FastPath® to apply to transport logistics chains to measure the current state of
performance (in terms of time, cost, and reliability) and to identify bottlenecks and
potential solutions.

The chapter commences with a description of the existing Central Corridor infrastructure
and its conditions by mode. This is followed by the diagnostic assessment of the corridor’s
performance.

Infrastructure and Conditions

The Central Corridor connects the Port of Dar es Salaam to markets in Tanzania, Burundi,
Rwanda, Uganda and DRC (See Figure 3-1). It connects the entire East Africa Community
to a major regional port for overseas trade and connects the EAC partner states and DRC
for intra-regional trade and personal mobility. The Central Corridor connects the Dar es
Salaam port to all of central and northern-western Tanzania itself, with extensions to
Burundi, Rwanda, Uganda and DRC. Several road sections have just been paved within
the last four years, making it a recent option for competitive cross border trade using the
Port of Dar es Salaam.

The rail network is also extensive, though in need of some rehabilitation. The railway goes
to Mwanza on the southern shore of Lake Victoria where rail ferries make an 18 hour
connection to Port Bell and nearby Kampala in Uganda or to Kisumu in Kenya. The
railway also connects to Lake Tanganyika at Kigoma Port, for vessel connections to
Bujumbura Port, Burundi and Kalemie and Uvira Port in DRC. These were previously
major multimodal routes and, with better rail service, would be important again.

Much of the road from Manyoni to Kigoma is not paved. Tanzania has begun
construction of this part of the Central Corridor to make it a road and rail route. There are
no rail connections to Burundi and Rwanda, but several studies have been carried out to
determine the feasibility of an extension to Kigali and to the nickel deposit area of western
Tanzania and eastern Burundi. The Central Corridor offers Burundi, Rwanda and the
Kalemoe/Goma/Bakavu area of DRC a shorter route to a major port. Despite its
 31

importance to the region, there are still many infrastructure and facilitation issues to be
addressed. Competition between the Central and Northern Corridor for the traffic of the
Great Lakes should improve performance on both Corridors.

Figure 3-1
Central Corridor Network

Port
Central Corridor Jinja
To Northern Corridor Port Port
Bell Kisumu
DRC UGANDA
Masaka
To Northern Corridor
Mutukula LAKE VIC TORIA
Walikale KENYA
Kyaka
Goma Kigali Bukoba
Muleba
To DRC RWANDA Rusumo To Northern Corridor
Namanga
Kayanza Nyakahura
TANZANIA
Ngozi Muyinga Lusahunga Mwanza
BURUNDI Shinyanga
Bujumbura Kobero Arusha
Gitega
Nzega Mbuyuni
Igunga
Kasulu
Kaliua
Tabora Muheza
Kigoma Singida
Gauge= Manyoni
Kalemie Uvinza 1000mm Dodoma
LAKE
TANGANYIKA Dar Es
Chalinze Salaam

Legend Mpanda Kilosa

Corridor Highway and Railway Iringa
Sitalike
Corridor Highway and P roposed Railway Improvement s
Corridor Highway Dar Es S alaam Corridor
Feeder Roads - Exist ing
Feeder Roads – Planned/ Proposed Improvem ents
To Lusaka
Mbeya Gauge=
Ext ensions into DRC
B order point
Mpulungu 1067mm
Railway
Count ry Border
Ferry Lines M ajor Cities/ Nodes Tunduma
ZAMBIA

Source: Nathan Associates Inc.

PORT OF DAR ES SALAAM

Total traffic through the port was 8.1 million tons in 2009. Container traffic in TEUs has
been increasing at 12.3 percent per annum since 2000 and reached 354 thousand TEUs in
2009. The container terminal at the Port of Dar es Salaam was given in 2000 in concession
to Tanzania International Container Services Company (TICTS), with Hutchnson HP as
majority shareholder. Immediately after concession, it realized a considerable
improvement in handling and dwell times. The container terminal, however, has from
2005 been constrained by space limitations and increased traffic through the port led to
congestion that caused deterioration in port performance indicators. It is now using
container freight stations (ICDs) to move domestic import cargo out of the port for all
clearance procedures and alleviate the congestion at the Container Terminal and at the
gate.
 32

Table 3-1
Dar Es Salaam Port Traffic (‘000 tons)

AAGR
Type of Cargo 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2000-2009
Imports
Containerised 727.2 849.7 895.9 1,024.1 1,265.2 1,372.0 1,347.2 1,915.7 2,171.7 2,056.0 12.2%
General Cargo 699.6 585.6 586.7 500.3 652.9 548.1 701.7 557.0 588.8 657.9 -0.7%
Dry Bulk 376.9 503.1 544.8 719.1 839.1 972.3 1,115.9 1,129.4 904.3 1,270.1 14.5%
Liquid Bulk 1,254.2 1,573.8 1,603.4 1,798.3 2,006.4 1,936.6 2,060.7 2,074.4 2,142.3 2,645.6 8.6%
Total 3,057.9 3,512.2 3,630.7 4,041.8 4,763.5 4,829.0 5,225.4 5,676.5 5,807.2 6,629.6 9.0%

Exports
Containerised 458.9 458.7 459.5 604.0 673.3 801.2 757.0 987.4 1,068.1 1,067.4 9.8%
General Cargo 219.9 168.4 211.2 238.0 187.4 172.8 205.6 282.4 122.0 148.2 -4.3%
Liquid Bulk 66.3 38.6 53.6 39.5 54.3 77.2 41.4 47.2 52.6 43.8 -4.5%
Total 745.1 665.8 724.3 881.4 914.9 1,051.2 1,004.0 1,317.0 1,242.7 1,259.4 6.0%

Imports and Exports 3,803.0 4,177.9 4,355.1 4,923.2 5,678.5 5,880.2 6,229.4 6,993.5 7,049.9 7,889.0 8.4%
Transhipment 31.5 93.4 168.7 245.8 375.6 404.9 428.1 433.8 354.5 213.0 23.6%
Bunkers 1.6 0.3 0.7 - - - - - 16.8 0.9 -5.7%

Total Traffic 3,836 4,272 4,525 5,169 6,054 6,285 6,657 7,427 7,421 8,103 8.7%
Container TEU's 124.6 141.7 141.4 167.7 199.3 228.7 240.6 334.0 373.5 353.7 12.3%
Source: TPA.

Figure 3-2 illustrates the current design and usage of the port terminals. Current container
operation is at Berth 8-11, operated by the concessionaire Tanzania International
Container Terminal Services Ltd (TICTS). The rapid growth of containerized traffic has
meant that berth 8 was added to the container terminal operated by TICTS and Tanzania
Ports Authority has handled some containers at Berth 7 and Berth 4 including all RoRo
containers. In addition, the container yard has also occupied some of the storage behind
the break bulk terminal. These factors have led to the plan for an additional container
terminal at Berth 13 – 14. The liquid bulk terminal is currently upstream of TICTS, and
also operating well over capacity. The construction of a new single point mooring, to
replace the old one which is no longer functioning, will help to alleviate this problem.

Figure 3-2
Layout of Dar es Salaam Port

Source: Tanzania Port Master Plan.

 33

In 2009, imports constituted 82 percent of the total traffic through the port. Of imports, 40
percent is liquid bulk, 31 percent is containerized cargo, 19 percent is dry bulk and 10
percent is general cargo. Exports constituting 18 percent of total traffic through the port,
were 85 percent containerized. Additionally, 3 percent is liquid bulk and 12 percent is
general cargo.

Figure 3-3
Dar Es Salaam Traffic by Cargo Type, 2009
Liquid
Imports General
Exports Bulk
Cargo 3%
12%

Containerised
Liquid Bulk
31%
40%

Containerised
Dry Bulk 85%
19%
General Cargo
10%

Source: TPA.

About 40 percent of the cargo through the port of Dar es Salaam is transit traffic, hence a
significant part of port business. The port of Dar es Salaam serves two major corridors, the
Central Corridor already defined and the Dar es Salaam Corridor which serves
southwestern Tanzania, Zambia Malawi and DRC. It is one of the major outlets for the
copper belt handling export of copper, cobalt and other minerals and import of
equipment, parts and supplies for the mines, in addition to meeting the demand of this
region for consumer goods. The corridor passes through areas of very high agricultural
potential and output, with a potential for major expansion. As illustrated, currently 64
percent of the transit traffic is on the Dar es Salaam Corridor, while about 36 percent is on
the Central Corridor. Different parts of DRC use both routes for overseas traffic, making
this percentage approximate. Both catchment areas for the port rely on several corridors
making for a competitive transport environment. .

Figure 3-4
Transit Traffic Distribution 2009

Source: TPA.
 34

Table 3-2 provides basic data on the port of Dar es Salaam the size, equipment, access and
current operational features and plans. A major problem is the depth of the harbor which
restricts the vessel size and adds the turnaround time for vessels and reduces berth usage.
Part of the port development plan is to dredge the channel and terminal to allow the port
to achieve economies of scale from larger vessels. Access for both road and rail is poor
and needs to be addressed. Port congestion has been a major problem affecting wait time
to enter the channel, time to unload and load, and dwell time in the port. The introduction
of ICDs to act as extensions of the port in clearing domestic imports has reduced all these
performance indicators, but as the following section will illustrate the port still needs to
address the time factors. Dwell time has been reduced to 12 days, but should still be
reduced substantially.

Table 3-2
Characteristics of the Dar es Salaam Port

Item Description
Natural Catchment Area All Tanzania, Great Lakes region, Uganda, Zambia,
DRC, Malawi
Volume of freight – total, import, export mtpa 8.1 mtpa in 2009
No of berths, depths 11, up to 10.1m, total length 550m
Container Berths 3 – 12Ha, operated by TICTS / Hutchinson
Container Equipment , Capacity 250 000, congested, 3x40t gantries, 13 rubber tired
cranes, 14 front end loaders, 13 forklifts
Container Vols - total, Imp, Exp - TEUs 350,000, mostly imports
Bulk berths & equipment Bulk grain, including grain bagging facilities, no
mineral berths
Marine Access Via 2 km channel
Road Access Road condition and access poor at port, congested
Rail Access Via TAZARA and TRL – poor service and access
Current Operational Status Fully operational, congested, delays, import dwell time
12 days, ship waiting 10 day before, now zero

Specific Problems / Issues Congestion in port and city, 11 inland terminals

licensed, 6 operational, road and rail access poor
Planned Developments Container terminal to be extended berths 13 &14,
maintenance and capital dredging required. Additional
Inland Container Freight Station being planned

Intervention / Assistance Required Assistance with operational planning and systems,

funding required. Port master plan completed in 2008
Source: Tanzania Port Master Plan.

Container Facilities
Containers are handled in Dar es Salaam in two types of facilities: (1) Specialized
Container Terminals and (2) Conventional Terminals. Once containers are unloaded they
are moved to stacks, originally all within the container terminal. Due to congestion and
the use of ICDs to extend the capacity of the port, by 2008 only about 37 percent of
containers were actually kept in the TICTS container yard, while 32 percent were kept at
the ICDs during clearing and the remainder elsewhere in the port. The specialized
terminal handles up to its capacity and then off-loading is scheduled with TPA.
Interviews with one of the shipping lines indicated a preference for waiting for TICTS
rather than using a conventional berth because of the greater efficiency. Table 3-3 shows
 35

the continuous growth in containerized imports with an average growth rate between
2000 and 2009 of 12.7 percent for full import containers and 10.4 percent for full export
containers. It also indicates the volume of empties handle by the port. It was also
mentioned that there was sufficient depot storage for empties at the port of Dar es Salaam.

Table 3-3
Dar es Salaam Container Traffic 2000-2009 (‘000 TEUs)

AAGR
Type 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2000-2009
Imports
Full 56.7 60.3 68.6 86.1 99.6 108.8 121.6 147.0 161.4 165.9 12.7%
Empty 5.5 5.3 4.5 4.0 5.9 5.6 3.2 0.7 0.6 1.7 -12.4%

Exports
Full 26.1 27.7 28.3 39.2 43.9 53.3 49.1 54.3 58.7 63.7 10.4%
Empty 34.4 38.9 40.0 38.4 49.8 59.8 68.8 81.0 95.7 106.0 13.3%

Transhipment
Full 2.0 6.3 24.8 36.6 55.6 61.0 60.4 56.8 38.2 16.4 26.5%
Empty - - - - - - - - - - -

Total
Full 84.7 94.3 121.7 162.0 199.2 223.0 231.1 258.1 258.3 246.1 12.6%
Empty 39.9 44.1 44.5 42.5 55.7 65.3 72.0 81.8 96.3 107.7 11.7%
Grand Total 124.6 138.4 166.2 204.4 254.9 288.4 303.1 339.9 354.6 353.7 12.3%
Source: TPA.

Presently, Dar es Salaam has six licensed ICDs, with five additional ICDs under
development. We visited two ICDs, TRH and Azam. TRH is the largest of Dar es Salaam’s
ICDs and closest to the port, located about 2 km away. This ICD began operations in 2007
with 17 ha and has the potential to grow to 35 ha. In comparison, Dar es Salaam’s
specialized container terminal only has about 13 ha. The main ICD’s facilities include a
large container yard based on concrete pavers, modern reachstackers (RS), warehouses,
Customs inspection shed and administration building, which also has offices for Customs
and TPA. The complex is surrounded by security fence with steel gates and around-the-
clock security. Azam is relatively small ICD, with a total area of about 4 ha, located about
7 km away from the port. Like TRH, the facilities, including container yard, sheds and
offices are new and well maintained. Both ICDs have short access roads connecting them
to the main highway leading to the port. Interestingly, both access roads are unpaved,
with deep potholes, which turn muddy during rainy days. These roads also often get
congested. Both ICDs declared their desire to finance the improvement of these roads but
are not allowed by the City. Both ICDs are well kept.

ROAD SYSTEM
The Central Corridor was originally a combination of paved and gravel road links. The
Central Corridor Road Project, which is nearing completion, involved rehabilitation (517
km), construction (527 km) and routine maintenance (200 km). Construction is planned
and managed by TANROADS, which also designs and manages the weighbridges to
control overloading on the route. When weighbridges where placed in the newly
constructed/rebuilt Central Corridor in 2006, TANROADS envisioned about 7
 36

weighbridges at points where additional traffic enters the corridor. There are now seven
fixed and three mobile weighbridges on the route, as well as customs and police
checkpoints. All of these affect the flow of traffic on the route. Transport demand has been
increasing rapidly and the choice of a fully paved route to the Port of Dar es Salaam offers
a shorter route for Rwanda and Burundi than the Northern Corridor to Mombasa.
Assuming good road, rail and port performance, it interjects competition between the
Central and Northern Corridors that should drive cost down and facilitate improvements.

An assessment of the Central Corridor road network was carried out by Aurecon for the
East African Transport Strategy and Regional Road Sector Development Program
conducted for the EAC in 2010. This assessment consisted of two major elements: road
capacity and road conditions.

Road Capacity and Other Characteristics

The evaluation of road capacity was based on level of service standards defined in the
Highway Capacity Manual. Level of service are classified with indices ranging from A
(best operating conditions) to F (worst operating conditions). The best operating
conditions entail free flow high (design) average speeds and able to overtake easily.

The characteristics of the Central Corridor Road network are shown in Figure 3-5.

Figure 3-5
Characteristics of the Central Corridor Road Network

Note: Traffic volumes are for the 30th highest hourly volume per direction.
Source: Aurecon, East African Transport Strategy and Regional Road Sector Development Program, 2010.

Road Conditions
Data obtained from the Primary and Secondary sources were used to determine the
current condition status of the pavement structures of the EAC corridor (Figure 3-6). The
first and foremost indicator of the pavements’ condition was pavement roughness, also
referred to as riding quality. This objective measurement describes the distortion of the
 37

pavement surface which contributes to an undesirable or uncomfortable ride. The unit for
roughness is the International Roughness Index (IRI) ranging between 0 (Good) to 20
(Very Poor).

• Paved roads are typically maintained at roughness levels between 2 and 6 IRI.
These roads require no immediate remedial action and are considered to be in a
sound state.

• Paved roads that are approaching a severe state have typical roughness levels
between 6 and 10 IRI. These roads are in warning state.

• Paved roads in a severe condition, requiring immediate remedial action have

typical roughness levels above 10 IRI.

The second indicator of pavement condition was an overall condition index, also referred
to as the Visual Condition Index (VCI). Visual assessments are a cost effective method of
gathering information to describe the functional and structural condition of a road’s
pavement.

Figure 3-6
Condition of Central Corridors Roads

Source: Aurecon, East African Transport Strategy and Regional Road Sector Development Program, 2010.

RAIL SYSTEM
The Central Corridor railway system (Figure 3-7) operates within Tanzania as the
Tanzania Railways Limited, (TRL). TRL is a joint venture company owned by Rites of
India (51%) and Government (49%), with Rites as the concession operating partner.
Railway assets are controlled by RAHCO, which is a state owned company. The system
consists of about 2,600 km of 1000 mm gauge track, generally light 30 kg/m rail with 15 t
axle loads. Some sections have gradually been upgraded to 45 kg/m and 18 t axle loads.
The condition of the equipment fleet of 109 locomotives and 1,670 wagons is uncertain,
given the operating cash flow problems since it was given in concession. Due to the poor
condition of the track, speed restrictions of between 13 km/hr and 50 km/hr are imposed
on many sections. Train turnaround time between Dar es Salaam and Mwanza or Kigoma
 38

is typically 18 days, rather than the scheduled 10 days, with the consequent increase in
operating costs.

Figure 3-7
Central and Northern Corridor Rail Systems

Source: Nathan Associates Inc.

LAKE TRANSPORT
Lake Victoria ferries provide another connection between Kenya, Uganda and Tanzania.
Ferries link through the port of Kisumu (Kenya) to Kenya’s railway and road network,
through Mwanza (Tanzania) to the Central Corridor and Tanzania’s railway system, and
through Port Bell and Jinja (Uganda) to the Northern Corridor and Uganda’s road
network.

The system is currently suffering from outdated ports, lack of equipment at the ports and
an extremely old fleet of small ferries. The current system is based on relatively modern
rail ferries which can handle 19-22 wagons on a roll on-roll off (RoRo) basis at Kisumu
and Port Bell (15 minutes from Kampala). The Kenyan ferry was previously used to carry
fuel and other goods to Kampala to overcome the necessity of locomotive and train
reconfiguration at the Uganda border. Kenya has put its ferry back into commission and
Uganda is rehabilitating their two ferries to revive this service to Mwanza. The Similar
Tanzanian service remains in operation, but on demand and not a scheduled operation.
There is also active private vessel haulage among the ports on Lake Victoria.

Inland waterways and port operations on Lakes Tanganyika and Victoria have a
significantly different structure and modus operandi. Lake Victoria has a much more
modern and viable merchant fleet particularly with respect to passenger and RoRo ferry
operations. They also have a more energetic private sector operating both shipping and
 39

port facilities. The public rail and port sector, however, lags well behind the private sector
in developing its facilities and providing modern port services to the merchant fleet and
shipping community. Paradoxically, on Lake Tanganyika with the exception of a few new
constructions the shipping fleet is very old and antiquated while the ports, particularly
Bujumbura, are reasonably well developed and have been investing in their infrastructure
to upgrade their facilities. This has been partly due to low demand caused by insecurity as
a result of civil wars in the surrounding areas especially in eastern DRC and Burundi.

Vessels
The “Integrated Transport Strategy – Lakes Tanganyika and Victoria” study developed by
Marine Logistics Ltd. (MLL) for the Central Development Corridor (CDC) Spatial
Development Initiative (SDI) project, February 2009 identified 23 vessels operating on
Lake Tanganyika of which 56.5 percent were 50 years or older and six were laid up or
inoperable. There were only three operating tugs on the lake, one in the Port of Kigoma
and two in the Port of Bujumbura. Of the eight dry cargo barges in the fleet, only two
have a total cargo capacity of 1,014 tons. In addition, only three general cargo vessels with
a total capacity of 1,500 tons and three combo carriers with a total capacity of 74 TEUs
were available for handling general or container cargo. Bujumbura was the sole port that
had the capacity for handling lift-on lift-off (LoLo) containers in the northern part of the
lake. Most of its recent container traffic was coming from Zambia due to the four months
closure of the rail service to Kigoma. By May 2010, the Port of Kigoma was expecting a
new mobile harbor crane capable of handling containers in September. However, the
design and age of the wharf will limit its effective use to less than 100 m of the quay.

On Lake Victoria the situation is a little different. The vessels are not nearly as ancient as
those on Lake Tanganyika (with the oldest dating to 1938). However, according to the
MLL study, of the 42 vessels that were listed ten were laid up. There were 13 operating
passenger/general cargo vessels, and seven relatively new car ferries that were oriented
primarily to the local markets. There were only two general cargo vessels of less than 200
GRT and three small tankers serving the transit markets.

Port Facilities
Since most of the main Lake Victoria ports were formerly or currently owned and
operated by the railroads, the primary means of transporting transit cargo was via an
integrated rail/ferry system in which each port was equipped with rail link facilities for
mooring and loading train wagon ferries. Five of these vessels were built between 1964
and 1979 of which one has sunk, two are laid up (Uganda), two are operational, one each
in Kenya and Tanzania. They are capable of carrying 19-22 rail wagons each (equivalent to
38-44 TEUs). During the first semester of 2010, the Tanzanian ferry has not been in
operation because of repairs to the mainline rail track between Dar-es-Salaam and
Dodoma.

Of the six ports only Bujumbura has made a major investment in the port infrastructure in
the last two decades. The main quay, which was built between 1939 and 1957, was
rehabilitated in 1990 in which the 100 m wide apron was resurfaced in concrete and new
crane rails and bollards were installed. In addition, the 50 year old rail mounted derrick
 40

cranes were rehabilitated in 2001. The only other infrastructure project under way is the
dredging of the Port of Kigoma and the rehabilitation of its slip ways.

With the exception of Bujumbura, the ports have some serious infrastructure problems.
The Ports of Kigoma and Mwanza have bi-level pile supported quays in which the bottom
water side level is only six meter wide. The top level, which is approximately one meter
higher, was added in response to a rise in water level by simply adding a facing wall on
top of the old deck and filling in dirt and gravel behind it. The Port of Kisumu essentially
did the same thing but topped the entire original apron so that the quay is at one level,
albeit surfaced with gravel. In all cases the original quays or piers, as in the case of Port
Bell and Jinja, were built between 1920 and 1930. Consequently there are serious questions
regarding their weight bearing capacity and suitability for supporting heavier cranes. On
Lake Victoria, the rail links at each of the ports are relatively well maintained except for
Jinja which has deteriorated to the point of being unusable.

Equipment
Bujumbura is the best equipped of all the ports, with four operating 5-ton rail-mounted
shore cranes, one fixed and one mobile container crane of 50 ton capacity, two 25-ton and
twelve 4.5-ton forklifts, one yard tractor, and one 80-ton weigh bridge. Kigoma is also
relatively well equipped; it has two of three 60-year-old rail-mounted derrick cranes
working and a 105 m wide rail mounted bridge crane of 35 tons operating in the container
yard, three working yard tractors, and 10 working forklifts.

The four ports on Lake Victoria are all inadequately equipped. In Mwanza the two 5-ton
jetty cranes were manufactured in 1929 and only one is still operational at a max of three
tons. They have only one operating forklift which is used in the warehouse. All ship shore
operations are primarily done using manual labor. There is one farm tractor used for
shunting the rail cars on and off the wagon ferry. They also have two relative new floating
dry docks that are fully functional. The largest is 100m x 24m with a lifting capacity of
2,100 tons while the smallest is 70m x 13m with a lifting capacity of 860 tons. However,
the machine and repair shops are rather limited in scope and equipment.

Kisumu, Port Bell and Jinja do not have any working cargo handling equipment at all and
consequently do not handle containers unless they are on a rail wagon. When a crane is
needed it has to be rented from the associated towns. Kisumu, however, does have a built
in functional dry dock 100m x 30m with a 6m draft. It is equipped with a swinging gate
that is opened and shut using a 250 horse power tug built in 1958. The facility also
includes one slipway under rehabilitation and one that is beyond use. It also has the most
fully equipped machine, carpentry, and fabrication shops of the ports that were visited.
The Port of Kisumu is also associated with a dry port operated by the KPA that is
approximately three kilometers from the port.

BORDER CROSSINGS
Border crossings in the region are characterized by poor infrastructure, inadequate
coordination, and congestion. The EAC has committed to introducing one-stop border
post (OSBP) operations at all its main internal borders and is also introducing OSBP at
 41

borders with countries outside the EAC. The regional OSBP legal framework being
developed by the EAC with support from JICA provides legal jurisdiction and structure,
operating principles and methods of coordination. Through this framework, common
practices will be introduced and harmonized throughout the community. The OSBP Act
approval process has involved all border agencies as has joint planning for the new
border facilities. Continuing support for this coordination is critical.

On the Central Corridor borders, support is given by several cooperating partners. On the
border between Tanzania and Rwanda at Rusumo, there is need for a new bridge to
replace the single-lane one, which is not built to handle the maximum allowable weights
on the route. JICA is supporting the construction of a two-lane bridge and new OSBP
facilities at this border. From Kigali, the Central Corridor continues to DRC. The African
Development Bank as part of the East Africa Trade and Transport Facilitation project is
financing a feasibility study for OSBP at Gisenyi/Goma on the Rwanda/DRC border. The
border between Tanzania and Burundi at Kabanga/Kobero is also planned as an OSBP
and TradeMark East Africa is planning a feasibility study for this border. There is at
present no commitment regarding the borders between Burundi and DRC, where traffic is
relatively light. New OSBP border facilities at Mutukula between Tanzania and Uganda
are funded by the World Bank also under the East Africa Trade and Transport Facilitation
Project. JICA is taking the lead under the Infrastructure Consortium for Africa in
coordinating support for the development and implementation of OSBP.

Cargo clearance can be done at the border, but generally it is done at inland clearance
centers, mostly in capitals. When clearance is not done at the border, it is generally done
in a few hours. Nevertheless, the process is not completed, and the 1-3 day final clearance
is part of the overall process. In our discussion of corridor performance, we use the term
“border” to describe both cost and time spent at the border plus the average time at the
final inland clearance point. In terms of improving facilitation on the Central Corridor,
both control points are important, as is control of vehicle movement.

Most trucks operating on the route are Tanzanian owned because arranging cargo from
the port and seeking return hauls in other countries is easier for Tanzanians. Road
transporters from the landlocked countries generally have an office or partner who
arranges for return haulage, mostly to their own country. The cargo is imbalanced in
favor of imports, and many return hauls are empty. The Tanzanian road transporters have
an active association, the Tanzanian Truck Owners Association (TATOA), which
represents their interests at the port and with government agencies concerning the
regulations that affect their operations. Freight forwarders are represented with national
and regional associations. These associations will be important co-drivers for more
effective transport facilitation measures on the corridor.

Corridor Performance by Component

The performance assessment provides a framework for the detailed analysis conducted
with our logistics performance assessment toolbox, FastPath. This is based on three
variables that define the performance of transportation networks: cost, time and the
 42

reliability of completing the shipment. The cost results are referred to costs paid by the
users of the transport corridor; therefore these include a normal profit and they can also
be referred to as prices.

For our analysis we defined the Central Corridor as in Figure 3-8. The main
origins/destinations of cargo are the port of Dar es Salaam, Kampala, Bujumbura, and
Kigali along the main corridor. Additional origins/destinations are Mwanza (Tanzania),
Goma (Rwanda connection to DRC). These origins/destinations were selected on the
basis of their importance as population and industrial centers as well as consolidation and
redistribution centers.

The transport network is divided in nodes and links each representing different physical
and operational characteristics. The nodes are marine ports, ICDs, border posts, and lake
ports that are necessary to connect links with different characteristics. The port node
contains information regarding five elements within the ports: the channel, the berth, the
yard, customs clearance and the gate. Other nodes contain information specific to their
physical characteristics and their operations. The links represent road, rail and lake
segments with unique characteristics. They contain modal information on capacity,
topography, price and travel time that defines its performance.

Figure 3-8
Links and Nodes of the Central Corridor

Source: Nathan Associates Inc.

Similar to the Northern Corridor, for the purpose of organizing and verifying the
information that will be introduced to the FastPath model a series of tables were prepared
with the information required to simulate the different elements of the logistics chain.

The nodes that were analyzed for the project are the port, border posts, lake ports and
inland clearance. The links that were analyzed are road, rail and lake segments.
 43

General discussions are made on the performance of the logistics chain for 20 foot light
containers as indicative of the processes. A discussion of the performance of other
commodities is presented in the Overview of Corridor Performance. Whenever relevant,
specific comments will be made on different performance for other commodities.

PORTS
There are several elements that are considered within the port node. They represent
different stages of the cargo processing that are commonly found in a port. These
elements are the port channel, the berth, storage-yard, customs, terminal handling and the
gate. Understanding that some of the activities take place at the same time and not
sequentially, we have distributed the cost and time among these elements such that the
totals match what was reported. The information is consolidated to represent the three
variables used to assess performance price, time and reliability (measured as the range of
time in which an activity can be completed).

Table 3-4 shows the input information for the import and export of 20 ft light containers in
the port of Dar es Salaam. For example, it costs US$ 297 and it took an average 217 hours
to complete the process to import a light container at the port of Mombasa. The process
could be completed in as little as 73 hours or as much as 266 hours. When looking at the
individual elements it can be seen that the terminal handling costs US$ 162, takes 24 hours
to complete and this time has a range between 4 and 48 hours.

Table 3-4
Port Input for the Import and Export of Transit 20 ft Light Containers
Price per Unit Average Time Max. Time Min. Time
Dar es Salaam (US$) (hours) (hours) (hours)
Import / Export Import Export Import Export Import Export
Port Channel 0 48 0 72 0 24 0
Berth 90 48 48 72 72 24 24
Storage - Yard 0 96 216 146 720 48 72
Customs and Agents 79 72 24 144 72 48 24
Terminal Handling 150 24 36 48 48 12 24
Gate 0 3 1 4 3 1 1
Total 319 291 325 486 915 157 145
Source: Prepared by Nathan Associates Inc.

BORDER POST
The border posts are another important node along the logistics chain. Customs clearance
at the border can represent significant delays. There are two components that are
analyzed within a border post: immigration and customs. As shown in Table 3-5, at the
Rusumo border post, an average of 4 hours is spent at Custom and less than 10 minutes at
immigration.
 44

Table 3-5
Border Post Input for 20ft Light Containers
Price per Average Time Max. Time Min. Time
Rusumo
Trip (US$) (hours) (hours) (hours)
Immigration 0 0.1 -- --
Customs 0 4.0 8 1
Total 0 4 8 1

Source: Prepared by Nathan Associates Inc.

ROAD
Each road link contains information pertaining to the physical characteristics of the road
segment as well as price, time and reliability. The physical information relates to its
distance, the type of terrain (flat, rolling, hilly and mountainous), surface condition (good,
fair and bad) as well as congestion level (congested and not congested). This information
is used to estimate a factor that is used to provide a weight to distribute the cost among
the road links for each road transport alternative. The performance information includes
the cost as a total for the link or per km, total time in the link (including wait time), wait
time (including rest stops), and the maximum and minimum speeds and wait times.

Table 3-6 shows the road link information between Dar es Salaam and Bujumbura for
import of 20ft light containers. The table shows that the most expensive road segment is
between Gitega and Bujumbura which is the result of sections with gravel road and
rolling terrain.

Table 3-6
Road Input for 20ft Light Containers
Ave. Trip Ave. Wait Max. Min. Max. Wait Min. Wait
Distance Cost
Segment Terrain Condition Congestion Time Time Speed Speed Time Time
(km.) (TEU/km)
(hours) (hours) (km/hr) (km/hr) (hours) (hours)
Dar-es-Salam-Morogoro 195 FH F L 2.36 17.5 12 60 30 18 8
Morogoro-Dodoma 274 H P L 2.75 9.5 2 60 30 3 0
Dodoma-Singida 227 FH F L 2.36 18 12 60 30 18 8
Singida-Nzega 214 H F L 2.55 8 2 60 30 3 0
Nzega-Lusahunga 318 FH F L 2.36 21 12 60 30 18 0
Lusahunga-Nyakahura 39 H F L 2.55 1.3 0 60 30 0 8
Nyakahura-Kobero 103 H F L 2.55 15.5 12 60 30 18 0
Kobero-Gitega 109 HM F L 2.95 3.9 0.3 60 30 0.45 0
Gitega-Bujumbura 88 M F L 3.64 3.5 0 60 30 0 0
Total 1567 154.2 52.3
Source: Prepared by Nathan Associates Inc.

RAIL
Similarly to the road links, the rail links contain information pertaining to the physical
characteristics of the rail segment as well as price, time and reliability. The physical
information relates to its distance, the type of terrain (flat, rolling, hilly and mountainous),
and track condition (good, fair and bad) as well as number of tracks. This information is
used to estimate a factor that is used to provide a weight to distribute the cost among the
links for each road transport alternative. The performance information includes the cost
as a total for the link or per km, total time in the link (including wait time), wait time
(including rest stops), and the maximum and minimum speeds and wait times.
 45

Table 3-7 shows the rail link information between Dar es Salaam and Mwanza for import
of 20ft light containers. The table shows that the track condition in the whole segment is
poor.

Table 3-7
Rail Input for 20ft Light Containers

Ave. Trip Ave. Wait Max. Min. Max. Wait Min. Wait
Distance No. Cost
Segment Terrain Condition Time Time Speed Speed Time Time
(km.) Tracks (TEU/km)
(hours) (hours) (km/hr) (km/hr) (hours) (hours)

Dar-Tabora 840 F P 1 1.2 82 49 40 10 164 33

Tabora-Isaka 159 F P 1 1.2 16 9 40 10 31 6
Isaka-Mwanza 230 F P 1 1.2 22 13 40 10 45 9
Total 1229 120.0 72.0 240 48

Source: Prepared by Nathan Associates Inc.

Overview of Central Corridor Performance

IMPORTS
Table 3-8 shows the price, time and reliability of each of the destinations from the port of
Dar es Salaam for imports of different type of cargo by handling served by road. The
information listed includes all costs and process times experienced by the shipments at
they proceed through the transport networks including ports, ICDs, border posts, inland
customs clearance (at capital cities), facilitation costs at weighbridges and check points
and rest stops.

Table 3-8
Central Corridor Performance for Imports by Cargo Type and Destination, 2010 (via road)
Price (US$ TEU) Time (hours) Reliability Indicator (%)
Distance
Destination Containers (TEU) Bulk (TL) Containers Bulk Containers Bulk
(km.)
Light Heavy Dry / Liquid Light / Heavy Dry Liquid Light Heavy Dry Liquid
Mwanza 1129 1,618 2,765 2,511 362 467 371 198 215 186 177
Goma 1640 3,618 5,418 5,161 565 670 574 135 145 144 136
Kigali 1495 3,314 4,918 4,661 420 525 429 171 186 166 155
Bujumbura 1567 4,369 6,961 6,704 440 545 449 163 177 159 147
Port Node*
Dar Es Salaam 319 319 62 291 396 300 245 266 217 217
Note: Port values are included in the total shown for each destination.

Source: Nathan Associates

The port related charges and times (included in the information by destination) are
specifically listed at the bottom of the tables because it makes it easier to assess their
significant contribution to the delays experienced and also to observe that in terms of
price the land transport represents the highest proportion.

For example, heavy containers going to Bujumbura are subject to a total cost US$ 6,961
per TEU, of which US$ 319 are port costs; it takes 149 hours to reach Bujumbura after
staying at the port for 291 hours, thus the total time of the segment is 440 hours; the
reliability of the segment indicates that the expected delays are within 177 percent range
above or under the average time. Generally, the price for heavy containers, dry and liquid
 46

bulk is similar. The table shows that the price goes up with distance (lowest rate per km is
to Mwanza at US$ 1.43/km for light containers). There are destinations with higher rates
that account for longer delays to clear customs, while the cargo remains loaded in the
truck; this is the case of Bujumbura at US$ 2.70/km and Goma at US$ 2.21/km.

Total travel time varies by destination depending on the number of border crossing and
the delays experienced at final clearance. The time at the port for containers is longer than
for bulk because the bulk is generally loaded into trucks at the berth, cleared customs and
released from the port immediately. If we calculate the average travel speed (excluding
the time at the port) we see that the route to Mwanza is the fastest (no border post)
followed by Kigali and Bujumbura (one border posts). The slowest trip is to Goma where
cargo has to wait about one week to be cleared after having crossed two border posts.

The reliability indicator reflects the range of variations in time with respect to the average
time it takes to complete each stage of the logistics chain. A higher value for the reliability
indicator signifies a greater variation and more likelihood of long delays. The port has the
greatest range of variation in time in the logistics chain hence the most unreliable.
Generally, road transport is the most reliable element of the transport logistics chain. As a
result, the longer the travel distance the lower is the overall reliability indicator since the
relative weight of the road transport reliability index increases.

Table 3-9 presents similar performance results for imports that use rail along the Central
Corridor. The average cost per km to Mwanza (US$ 1.46/km for a container) is less costly
than to Kampala (US$ 1.59/km) and Bujumbura (US$ 1.66/per km).

Table 3-9
Central Corridor Performance for Imports by Cargo Type and Destination (via rail or rail and lake)
Price (US$ TEU) Time (hours) Time Variation (%)
Distance Containers Bulk Containers Bulk Containers Bulk
Segment
(km.) Light / Dry / Light / Dry / Light / Dry /
Heavy Liquid Heavy Liquid Heavy Liquid
Kampala 1,568 2,507 2,250 530 539 150 152
Mwanza 1,229 1,794 1,537 411 420 192 193
Bujumbura 1,446 2,403 2,146 524 533 152 154
Port Node*
Mwanza Port - Port Bell 132 132 48 48 150 150
Dar Es Salaam 319 62 291 300 266 266
Note: Port values are included in the total shown for each destination.

Source: Nathan Associates Inc.

EXPORTS
For exports, similar tables have been prepared. Table 3-10 shows that for export flows via
road the cheapest rates are also for Mwanza (US$ 1.43/km). This is the shortest segment
and involves fewer delays because it has no border post. The most expensive segment is
Bujumbura with a cost of US$ 2.78/km for light containers and US$4.44/km for heavy
containers. In terms of average speed of the segments (without considering the time spent
at the port) Mwanza is the fastest segment followed by Bujumbura, and Kigali. The
reliability indicator show similar levels of reliability along all the segments of the corridor.
 47

In general, the shortest trips are the most unreliable given that the impact of the port
unreliability is more significant. Variations in reliability of border crossing are also
reflected in the results.

Table 3-10
Central Corridor Performance for Exports by Cargo Type and Origin (via road)

Price Reliability
Distance Time
Origin (US$ TEU) Indicator %
(km.) (hours)
Light Heavy Light Heavy
Mwanza 1,129 1,618 2,768 396 283 260
Goma 1,640 3,618 5,418 599 200 186
Kigali 1,281 3,314 4,918 454 248 228
Bujumbura 1,567 4,369 6,961 480 234 217
Port Node*
Dar Es Salaam 319 319 325 344 316
Note: Port values are included in the total shown for each destination.

Source: Nathan Associates Inc.

For the exports flows transported via rail, Table 3-11 shows that the transport rate per
kilometer are similar; for Mwanza (US$ 1.45/km for all containerized cargo) is lower than
Kampala (US$ 1.59/km) and Bujumbura (US$ 1.66/km). In terms of average speed (time
of travel discounting the port time), the results are quite different with Mwanza being
significantly faster (17.1 km/hr) compared with 8.2 km/hr and 7.7 km/hr for Kampala
and Bujumbura respectively. This is due to the speed of the lake portion of the segment
that lowers the average of the segments from Kampala and Bujumbura.

Table 3-11
Central Corridor Performance for Exports by Cargo Type and Origin (via rail or rail / lake)
Price Reliability
Distance Time
Origin (US$ TEU) Indicator %
(km.) (hours)
Light / Heavy Light / Heavy
Kampala (via rail/lake) 1,568 2,507 636 221
Mwanza (via rail) 1,229 1,794 517 271
Bujumbura (via rail/lake) 1,446 2,403 631 223
Port Node*
Port Bell - Mwanza Port 132 48 150
Dar Es Salaam 319 397 351
Note: Port values are included in the total shown for each destination.

Source: Nathan Associates Inc.

When comparing imports to exports, it can be seen that moving containerized cargo has
basically the same cost for import and export flows. This is explained by the tariff
structure of the port of Dar es Salaam that charges the same prices for inbound and
outbound containers. In terms of time containerized exports are subject to longer times at
the port and the overall result for all segments indicates that exporting is slower than
importing. The reason behind this is that containerized exports spend more time at the
port than imports; the exporters are using the port as warehousing facility until the
arrangement for the overseas transport of the cargo is made.
 48

Cost and Time Comparison by Transport Alternative and

Component
This section presents the results of the performance assessment for light containers
which are generally indicative of the results for other cargo types. This section
presents the results of the performance assessment for light containers which are
generally indicative of results for other cargo types. The results are presented for
imports/exports for the selected transport alternatives connecting each origin
/destination and the port of Mombasa. The figures show the participation of each
component (links and nodes) in the total costs and time of the transport alternative6.

IMPORTS
Two transport alternatives were considered for the segment between Dar es Salaam and
Mwanza, one via road and one multimodal that combines rail and lake links. Figure 3-9
shows that the rail alternative is more expensive and slower than the road alternative. In
terms of total costs (including facilitation and extra inventory) the rail connection exceeds
by 9 percent the road and in terms of time rail exceeds the road mode by 14 percent. The
difference in cost is explained by the higher price of rail surface transport and also in
higher extra inventory cost.

Figure 3-9
Cost and Time for Central Corridor Destinations Served by Road and Rail/ Lake Transport
Alternatives, 2010 (light containers)

Source: Nathan Associates Inc.

The time that the cargo spends at the port is identical; therefore, total time difference is
explained by the longer time required to complete the movement of the cargo between the
port and Mwanza via rail. The participation of port-related costs and times in the total for
both modes is similar; port costs account for 20 percent in the road option and 18 percent

6 The tables present the actual values of each component and include the estimated facilitation and extra
inventory costs. The extra inventory cost is the estimated value of additional goods that corridor users
have to move through the system, in order to maintain an uninterrupted supply / provision for their
regular operations. All percentages in the figures are based on transport costs only.
 49

in the rail option; the remaining costs of both alternatives are related entirely to the
surface transport cost. Time at the port for containers transported by road is 80 percent of
the total time, while via rail is 71 percent.

Similar to the previous segment, a road and a rail / lake alternatives were analyzed for
the Dar es Salaam and Bujumbura segment. The rail / lake option is less expensive and
slower than the road option, as would be expected. This alternative was the historic
favorite for the shippers in Bujumbura and the one they are very interested in seeing
improved. The cost of the multimodal option (including facilitation and extra inventory)
is 38 percent less than the road; road surface transport costs almost triple rail surface
transport costs. As for the port related costs these are higher for the rail / lake because
cargo goes through three port nodes, Dar es Salaam, port of Kigoma and the port at
Bujumbura. The time for the rail / lake alternative is higher by 21 percent than for the
road. This is caused by the poor port infrastructure and inefficiencies of the rail and the
lake ports which hamper the intermodal transfer. Understandably, most of the costs for
imports moved by road are related to surface transportation; in the multimodal option rail
transport costs are the most relevant part with a 62 percent share of the total. In regards to
time, the port is the most important component for both alternatives, accounting for 67
percent and 74 percent respectively (the last number includes the time at Kigoma and
Bujumbura lake ports).

The road alternatives between Dar es Salaam and Goma and Dar es Salaam and Kigali
present a similar distribution of times and costs (Figure 3-10). Road related costs are the
prevailing component with 91 and 90 percent of the share of the total respectively. In
terms of time, port is the most significant element for both destinations; additionally, in
the case of Goma, containerized cargo spends around seven days clearing border post
procedures, therefore there is a significant participation of border post related time, which
accounts for 30 percent of the total time of the segment.

The multimodal alternative from Dar es Salaam to Kampala integrates rail and lake links;
rail costs represent the main share of the overall cost (59 percent). Time at the port has the
highest participation in the overall time accounting for 73 percent of the total. Port costs
and time for this transport alternative include the values for Dar es Salaam, port of
Mwanza and Port Bell. This option is currently not very competitive when compared to
the transport alternatives along the Northern Corridor due to the lack of scheduled ferry
services and inefficiencies in the operation of TRL. Anecdotal information suggests that at
the peak of operation of the East Africa Railway, the cost and time were very competitive
which suggests that if the services are improved, this could be a viable transport
alternative.
 50

Figure 3-10
Cost and Time for Central Corridor Destinations Served by Single Transport Alternatives Road or
Rail/ Lake, 2010 (light containers)

Source: Nathan Associates Inc.

EXPORTS
The transport alternatives considered for exports correspond exactly to the ones presented
for imports. Containerized exports flowing between Mwanza and Dar es Salaam are
subject to higher cost and longer time if they use the rail option instead of the road
alternative (Figure 3-11).

Figure 3-11
Cost and Time for Central Corridor Origins Served by Road, 2010 (light containers)

Source: Nathan Associates Inc.

 51

The rail total cost exceeds the road cost by 15 percent, while the time difference is 31
percent. The difference in cost is due to higher rail surface transport costs and also higher
extra inventory cost. The participation of port related costs and times in the total for both
modes is similar; port costs account for 20 percent in the road option and 18 percent in the
rail option; the remaining costs of both alternatives are related entirely to the surface
transport cost. Time at the port for containers transported by road is 82 percent of the total
time, while via rail is 77 percent.

The total cost of the connection between Bujumbura and Dar es Salaam via road is 29
percent higher than the rail cost as the road distance is considerable longer than the rail –
lake distance. Even though the port and the extra inventory costs of the rail alternative
exceed those corresponding to the road mode, the US$ 2,320 difference in higher road
surface transport costs makes the road alternative more expensive. The participation of
port costs in the rail/lake alternative is 24 percent versus only 7 percent in the road
alternative. Also the participation of port time is higher in the rail/lake scenario by 10
percent. This higher participation is again explained because the port value for the
lake/rail alternative aggregates costs and times for the three port nodes of the segment,
Dar es Salaam, port of Kigoma and the port at Bujumbura.

The road alternatives for exports between Dar es Salaam and Goma and Dar es Salaam
and Kigali present a similar distribution of costs between port and road surface cost
(Figure 3-12). Road related costs are the prevailing component with 91 and 90 percent of
the share of the total respectively. In terms of time, port is the most significant element for
both destinations; additionally, in the case of Goma, containerized cargo spends around
seven days clearing border post procedures, therefore there is a significant participation
of border post related time, which accounts for 28 percent of the total time of the segment.

For the multimodal alternative from Dar es Salaam to Kampala the rail costs represent
the main share of the overall cost (59 percent). Time at the port has the highest
participation in the overall time accounting for 77 percent of the total. Port costs and time
for this transport alternative include the values for Dar es Salaam, port of Mwanza and
Port Bell.
 52

Figure 3-12
Cost and Time for Central Corridor Origins served by a Single Transport Alternative, 2010 (light
containers)

Source: Nathan Associates Inc.

Interpretation of Results

DAR ES SALAAM PORT PERFORMANCE

The analysis of all the different alternatives between the selected destinations / origins for
exports and imports along the Central Corridor show consistently that the greatest share
of the time is spent at the port of Dar es Salaam.

Table 3-12 summarizes the assessment of the specific components of the port node. The
results show that containerized cargo spends most of the time in the yard, which
understandably, presents also the lower logistics score of the node components. The next
component with a mayor share in time is the berth and accordingly its logistics score is
the second lower. Gate operations occur generally in an efficient and fluid manner, being
this element the best ranked according to the port nodes logistics scores.
 53

Table 3-12
Dar es Salaam Port Performance (light containers)

Imports Exports

Reliability Reliability
Price Time Indicator Price Time Indicator
Component (US$) (hrs) (%) (US$) (hrs) (%)

Dar es Salaam Port 319 291 245 319 325 344

Channel 0 48 100 0 0 0

Berth 90 48 100 90 48 100

Yard 150 120 112 150 252 243

Customs 79 72 133 79 24 100

Gate 0 3 112 0 1 200

Source: Nathan Associates Inc.

Shipping lines have indicated that the productivity in handling smaller ships at Dar es
Salaam, with about 500 moves (in/out), was 10 moves/crane–hour. Since smaller ships
were usually assigned only one crane, this also was the berth productivity. Accordingly,
the berth time for handling these ships was about two days. For larger ships, handling
800–1,200 moves/call, productivity did reach higher levels of about 13 moves/crane–
hour. Since these ships work part of the time with two cranes, the overall berth
productivity was 15 moves/berth–hour. At this handling rate, these ships spent three to
four days at berth. Participants in our Dar es Salaam workshop in October 2010 observed
that recently TICTS has been reaching 20 moves/berth-hour, presumably following the
commissioning of the new STS gantry cranes.

The reason for the low productivity, according to the shipping lines, was first and
foremost yard congestion. The shore cranes spent much of their time waiting for yard
tractors, while these tractors, in turn, were waiting for RTGs. The congestion and waiting
of shore cranes is attributed to the simultaneous handling of RTGs yard tractors and
outside trucks of shippers and consignees. These trucks compete with yard tractors on
RTG services and also queue inside the stacks. Moreover, handling import boxes to
outside trucks often requires shuffling of boxes, which sometimes may require additional
five moves (TICTS operates with one over five RTGs). Another reason for the low
productivity is frequent breakdowns of handling equipment, especially the 25 year old
gantry cranes. Shipping lines also complained that there was a shortage in all types of
handling equipment: shore cranes, RTGs, RSs and yard tractors. For example, the lines
claimed that ships with 500 moves should be assigned two shore cranes and those with
1,000 moves even three cranes (depending on stowage plan).

The productivity data provided by the terminal operators was somewhat higher than that
claimed by lines. TICTS claimed that crane productivity has recently increased reaching
12 moves/crane-hour. TICTS agreed that the main reason for the low productivity is
congestion; in the pre–congestion period, they claim that productivity was +20
moves/crane–hour.
 54

TPA claimed that their MHCs’ productivity was 12–14 moves/crane–hour. Accordingly,
while typically working with two MHCs, berth productivity was at times 24–28
moves/berth–hour. This productivity was similar or perhaps even exceeding that of
TICTS, which explains why lines preferred directing their ships to the conventional
container terminal when the container terminal was occupied.

Ships’ waiting time, according to shipping lines, ranged two to four days, which was a
great improvement compared to up to 12 days previously. As seen above, berth time at
TICTS for small ships was two days and for large ships three to four days. Hence, the total
port time ranged from five to seven days.

No data on truck turnaround times was available. The lines indicated that it was probably
six to eight hours. The long time was required due to the pre–gate, out–gate and RTG
waiting along with waiting for the scanning process. Even longer waiting times were
required in case of Customs verification (physical inspection). It should be noted that all
containers, including those transferring to the ICDs, are required to be scanned at the
port.

OTHER CAUSES OF INEFFICIENCY

Other causes of corridor inefficiencies that are common to the Northern and Central
Corridors are described at the end of Chapter 2.
 55

4.Comparative Corridor
Performance and Future
Requirements
In this chapter, we present a comparative assessment of the performance of the Northern
and Central Corridors. First, we compare the two corridors performance to common
destinations or origins served for imports and exports, respectively. This is followed by a
comparison of the overall performance of the Northern and Central Corridors to other
African and Asian corridors. The chapter concludes with the presentation of the trade and
traffic forecast for the Northern and Central Corridors.

Comparative Analysis
In this section we present a performance comparison for the transport alternatives on the
Northern and Central Corridors serving common origins or destinations by cargo type. In
the tables that are presented, the best result for each destination in terms of price, time
and reliability is highlighted with a box.

IMPORTS
As shown in Table 4-1, there are three transport alternatives into Kampala, one for road
and one for rail on the Northern Corridor and one on lake + rail on the Central Corridor.
The rail alternative on the Northern Corridor offers the lowest price and the best
reliability for light containers and liquid bulk. The fastest time for all types of cargo is
offered by the road alternative on the Northern Corridor. In terms of price, the Northern
Corridor road option is the least expensive for light containers and liquid bulk; the
Central (rail +lake) option is the least expensive only for dry bulk cargo. These results are
consistent with the results on other destinations.
 56

Table 4-1
Performance Comparison of Destinations Served by Both the Northern and Central Corridors,
2010 (imports)

Light Containers Dry Bulk Liquid Bulk

Destination and Distance
Mode
Corridor km. Price Time Reliability Price Time Reliability Price Time Reliability
(US$) (hours) Indicator (US$) (hours) Indicator (US$) (hours) Indicator

Kampala
Northern Road 1,180 2,099 323 194 3,511 276 262 3,316 240 217
Northern Rail 1,200 2,059 462 138 3,432 415 177 3,237 379 141
Central Rail+Lak 1,568 2,507 530 150 2,250 539 152

Kigali
Northern Road 1,661 3,901 376 167 6,658 329 220 6,463 293 178
Central Road 1,495 3,314 420 171 4,661 525 166 4,661 429 155

Bujumbura
Northern Road 1,903 4,950 411 153 8,511 364 200 8,316 328 160
Central Road 1,567 4,369 440 163 6,704 545 159 6,704 449 147
Central Rail+Lak 1,446 2,403 524 152 2,146 533 154 2,146 533 154

Goma
Northern Road 1,811 4,822 537 131 8,200 490 162 8,005 454 135
Central Road 1,640 3,618 565 135 5,161 670 144 5,161 574 136

Port Node*
Mombasa Transit 297 217 287 360 170 424 165 134 386
Dar Transit 319 291 245 62 396 217 62 300 217
Note: Port values are included in the totals shown for each destination.
Source: Nathan Associates Inc.

The case of Kigali shows that the road alternative on the Central Corridor offers the
lowest price (US$ 587 less) while not the fastest time which is offered by the road
alternative on the Northern Corridor (44 hours faster). This relationship is held over the
other cargo types analyzed. Additionally, it’s worth to note that this matches the
perception that while the distance from Kigali and Bujumbura are shorter to the port of
Dar es Salaam (hence the lowest prices to ship through Dar), the faster service is offered
by the alternatives through the port of Mombasa (given its faster processing time). The
road transport alternatives to Goma show similar results with the lowest price on the
Central Corridor and the fastest alternative on the Northern Corridor.

For Bujumbura different transport alternatives have the lowest price (rail and lake
alternative on the Central Corridor) and the fastest time (road alternative on the Northern
Corridor) for transporting light containers. The rates for rail and lake transport are
generally the lowest and coupled with a shorter distance combine to make this alternative
the one with the lowest time. On the other hand, rail and lake are also the slowest and
most unreliable with together with the fact that Dar es Salaam is slower than Mombasa by
74 hours explain why the fastest alternative is by road on the Northern Corridor. The
performance comparison of transport alternatives for other cargo types shows similar
results.
 57

EXPORTS
Table 4-2 presents a performance comparison for the transport alternatives on the
Northern and Central Corridors serving common export origins by cargo type. For Kigali
and Goma, there are two road transport alternatives. As with imports, the road
alternative on the Central Corridor has the lowest price while the fastest is the one on the
Northern Corridor. This is true for light and heavy containers.

For exports from Bujumbura there are three transport alternatives. The lowest price is
observed in the shortest alternative that additionally uses the least expensive modes (rail
and lake). The fastest alternative is by road on the Northern Corridor.

Finally for Kampala, the lowest price for light containers is by rail on the Northern
Corridor and the fastest in on the same corridor but by road. The results for heavy
containers indicate that the lowest price is on the Central Corridor by rail and lake even
though this alternative is the longest (because of the partial suspension of services). The
information provided by TRL indicates no differentiated transport rates for light and
heavy containers. On the other hand, RVR indicates that the common business practice is
to charge higher tariffs for heavy containers. Since that differentiation was not reported by
TRL, the tariffs for the central corridor are the same for light and heavy containers and
less expensive that on the Northern Corridor for heavy containers.

Table 4-2
Performance Comparison of Origins Served by Both Northern and Central Corridors, 2010
(exports)

Light Containers Heavy Containers

Origin and Distance
Mode Price Time Reliability Price Time Reliability
Corridor km.
(US$) (hours) Indicator (%) (US$) (hours) Indicator (%)
Kampala
Northern Road 1,180 2,062 395 267 3,441 395 353
Northern Rail 1,200 2,022 558 191 3,362 558 260
Central Rail+Lake 1,568 2,507 636 221 2,507 636 221

Kigali
Northern Road 1,661 3,864 422 250 6,588 422 261
Central Road 1,281 3,314 454 248 4,918 454 228

Bujumbura
Northern Road 1,903 4,913 433 244 8,441 433 255
Central Road 1,567 4,369 480 234 6,961 480 217
Central Rail+Lake 1,446 2,403 631 223 2,403 631 223

Goma
Northern Road 1,811 4,785 429 246 8,113 429 257
Central Road 1,640 3,618 599 200 5,418 599 186

Port Node*
Mombasa - Transit 260 313 336 290 313 351
Dar - Transit 319 325 344 319 325 316
Note: Port values are included in the totals shown for each origin.
Source: Nathan Associates Inc.
 58

COMPARISONS OF NORTHERN AND CENTRAL CORRIDOR PERFORMANCE

TO OTHER AFRICAN AND ASIAN CORRIDORS

In order to assess the overall performance of the Northern and Central Corridors it is
useful to compare their performance with that of other corridors in Africa and elsewhere.
The FastPath methodology used for CDS has been applied to several other African and
Asian corridors and provides an appropriate basis for comparison.

In addition to the above indicators for price, time and reliability, FastPath calculates
“logistics scores” for each transport/logistics chain, segment and component. The
logistics score is computed by comparing the performance of a component of the
transport/logistics chain and rating it as good, fair, poor or very poor, according to
international standards. This rating is then converted to a numeric score (61-80 if good,
41-60 if fair, 21-40 if poor and 1-20 if very poor). Then the scores for price, time and
reliability are averaged to get the total score for a component. The scores for nodes and
links are then given a time-weighted average to compute the segment total. If there is
more than one segment corridor in a corridor, their scores are combined to compute their
volume-weighted average for the total chain.

A logistics score between 70 and 80 indicate that time, cost and reliability in the total
supply chain is efficient and competitive according to global standards. These scores are
computed only for containerized cargo.

Figure 4-1 presents a comparison of FastPath logistics scores by corridor and segment.
The overall score is shown as well as the component scores for port, road rail and border
posts. For the Northern Corridor, imports to Nairobi, Kampala and Kigali by road
currently are all rated as “Good” albeit at the bottom of the Good scale. Other Northern
Corridor destinations are currently rated in the upper range of the “Fair” category.
Mombasa Port is considered as “Fair”. Road segments to Nairobi, Kampala and Kigali as
scored as “Good” while other destinations have a “Fair” rating. The rail component is also
rated as “Fair”. All of the border posts in Northern Corridor are rated as “Good” with the
exception of Nimule which is rate “Fair”.

For the Central Corridor the overall score to all destinations is “Good” except for
Bujumbura which is rate “Poor” due to the performance of the road. The Port of Dar es
Salaam is rated as “Fair” and is scored a few points below the Port of Mombasa. All of the
border posts in the Central Corridor are rated as “Good”.

The overall performance of the two corridors is considered fair and is comparable to the
performance of the other African and Asian corridors shown in Table 4-3. However, the
goal should be to reach a Good rating for all components that corresponds to a score
between 60 and 80.
 59

Figure 4-1
Comparison of Fastpath Logistics Scores by Corridor and Segment
Logistics Score
Corridor and Segment Border
Overall Port Road Rail1
Post2
Northern Corridor (from Mombasa port)
Nairobi (via road) 61 57 73 -- --
Nairobi (via rail) 50 57 -- 47 --
Kampala (via road) 64 57 64 -- 67
Kampala (via rail) 53 57 -- 49 77
Bujumbura (via road) 57 54 54 -- 71
Kigali (via road) 61 54 60 -- 68
Nimule(via road) 54 54 52 -- 57
Kasindi (via road) 56 54 55 -- 62
Goma (via road) 52 54 48 -- 67

Central Corridor (from Dar es Salaam)

Mwanza (via road) 50 52 50 -- --
Mwanza (via rail) 51 55 -- 50 --
Bujumbura (via road) 36 52 30 -- 70
Bujumbura (via rail) 54 55 60 48 80
Kampala (via rail) 56 55 60 51 80
Kigali (via road) 59 52 58 -- 72
Goma (via road) 45 52 41 -- 70

Other Road Corridors in Africa

Tema - Ouagadougou (2008) 51 55 55 -- 46
Durban - Nelspruit (2007) 63 60 65 -- 73
Maputo - Nelspruit (2007) 62 51 51 -- --

Road Corridors in Asia

Laem Chabang -Vientiane (2006) 64 49 70 -- 65
Dacca Chittagong (2006) 59 60 58 -- --
Note 1: Rail score aggregates the results for segments combining rail and lake links.
Note 2: Border post score is the average score of all border posts in the segment.
Source: Nathan Associates Inc.
Good 61-80
Fair 41-60
Poor 21-40
Very Poor 1-20

Trade and Traffic Forecasts

In this section we discuss historic trends in East African trade flows and present the
current traffic volumes handled on the Northern and Central Corridor by mode and type.
This is followed by the outlook for GDP growth in the region through 2030 and the
forecast of regional trade. We conclude with a presentation of the forecast of Northern
and Central Corridor traffic by mode and type for 2015 and 2030.
 60

TRENDS IN EAST AFRICAN TRADE FLOWS

As in other parts of Africa, East African trade is very overseas-oriented. Total East African
trade was 34.5 million tons in 2008, consisting of 27 million of imports (78.4 percent) and
7.5 million of exports (21.6 percent). Most of its exports and imports are with overseas
partners (62 and 78 percent respectively), while the rest stay within East Africa region (30
and 8 percent) and with other African countries (8 and 14 percent). This is shown
graphically in Figure 4-27

Figure 4-2
Distribution of East Africa Exports and Imports, 2008

Source: IMF Direction of Trade Statistics, and COMTRADE.

From 2005 through 2009, there was rapid growth in transit traffic for countries using the
Northern and Central Corridors as shown in Table 4-3. Total transit imports increased
from 3.4 million tons in 2005 to 5.6 million tons in 2009, corresponding to an average
annual growth rate of 13.3 percent. In 2009, Uganda accounted for two-thirds of transit
imports and half of transit exports. Burundi transit imports increased from a conflict-
related depressed base of 103 thousand tons in 2005 to 335 thousand tons in 2009, an
average annual increase of 34.3 percent.

7 The “Study Area” is defined as the following eight countries: Burundi, Congo DR (Eastern), Ethiopia,
Kenya, Rwanda, Sudan (Southern), Tanzania, Uganda , while “Other Africa” is defined as the countries
in the African continent other than East Africa region.
 61

Table 4-3
Transit Traffic of Landlocked Countries, 2005-2009 (000 tons)

AAGR
2005–2009
Country 2005 2006 2007 2008 2009 (%)

IMPORTS

Burundi 103 177 212 270 335 34.3

Eastern DR Congo 467 592 653 736 834 15.6

Ethiopia 11 12 13 15 17 11.5

Rwanda 244 320 371 487 550 22.5

Sudan 141 130 145 220 156 2.6

Uganda 2,449 2,578 3,151 3,471 3,730 11.1

Total 3,416 3,809 4,546 5,199 5,622 13.3

EXPORTS

Burundi 56 57 65 72 59 1.3

Eastern DR Congo 63 77 98 122 145 23.2

Ethiopia 30 35 40 45 50 13.6

Rwanda 34 40 31 39 41 4.8

Sudan 1 1 1 1 1 0.0

Uganda 293 282 318 334 299 0.5

Total 478 491 553 612 595 5.6

Source: Nathan Associates Inc.

The average annual growth in trade from 2005-2009 is presented in Figure 4-3. Import
growth exceeded export growth in all countries but Sudan. The highest growth in imports
was Rwanda (32 percent), followed by Uganda (24.1 percent) and Tanzania (19.1 percent).
Uganda (22.7 percent), Sudan (15.6 percent) and Ethiopia (15 percent) had the highest
growth in exports. The difference in import vs. export growth was more significant in
Rwanda, Burundi and Kenya, where import and export growth were closer in speed in
Uganda and Tanzania.

During this period, Kenya’s imports increased at an average annual rate of 15 percent
whereas exports grew by only 7 percent. Tanzania imports and exports increased at an
annual rate of 19.1 percent and 15.6 percent, respectively.
 62

Figure 4-3
Average Annual Growth of Imports and Exports by Country 2005-2009 (percent)

Source: Nathan Associates Inc.

Further observations on common characteristics and trends regarding East African trade
flows include:

• Countries with a recent history of conflict and economic crises had very low or
negative trade growth in the last decade. The most prominent examples are DR
Congo with high negative trade growth rates and Burundi with low import
growth rates. Countries that had conflict earlier had high growth rates reflecting
recovery, such as Rwanda.

• Export growth rates tend to be faster for overseas trade than those for imports.

• Overseas trade is higher in unit value than trade within Africa. We see a
generally increasing trend in overseas trade.

• Europe used to be a major trading partner but its share in total trade seems to be
gradually decreasing for most East African countries.

• East Asia is an emerging trading partner for East Africa and its imports from East
Africa are projected to increase continuously.

• In the recent past, there are certain countries with high short term growth rates
(e.g., 34 percent import growth to overseas regions for DR Congo). However, the
growth rates for these countries are expected to stabilize at lower levels in the
long run.

CURRENT NORTHERN AND CENTRAL CORRIDOR TRAFFIC

As presented in Table 4-4, total traffic on the Northern and Central Corridors in 2009 is
estimated at 28.6 million tons, of which 21.5 million tons were shipped via the Northern
Corridor (75 percent) and 7.1 million tons on the Central Corridor (25 percent). More than
83 percent of the traffic on the Central Corridor was domestic, that is, Tanzanian trade to
overseas countries. Regional trade and transit traffic accounted for 10 percent and 7
percent, respectively of the remaining Central Corridor traffic. On the Northern Corridor,
 63

Kenyan overseas trade accounted for 58 percent of the total corridor traffic with transit
traffic next at 28 percent and regional trade at 14 percent.

Table 4-4
Northern and Central Corridor Traffic by Type and Mode, 2009 (000 tons)

Rail
Share
Type of Traffic Road Rail Total (%)

NORTHERN

Transit 5,509 417 5,926 7%

Regional 2,974 151 3,125 5%

Domestic 11,817 622 12,439 5%

Total 20,300 1,190 21,490 6%

CENTRAL

Transit 357 111 468 24%

Regional 658 32 690 5%

Domestic 5,617 296 5,913 5%

Total 6,632 439 7,071 6%

Total 26,932 1,629 28,561 6%

Source: Nathan Associates Inc.

Historically, the landlocked countries of Burundi, (Eastern) DR Congo, Rwanda and

Uganda divide their overseas imports and exports between the Northern and Central
Corridors, while Southern Sudan and Ethiopia only use the Northern Corridor. The
shares of transport volumes using each port from these countries for import and exports
are shown in Figure 4-4 for the period 2005-2009.

Figure 4-4
Share of Transit Traffic by Corridor, 2009 (percent)

Source: Nathan Associates Inc.

 64

REGIONAL GDP GROWTH

Trade forecasts were prepared using a regression analysis based on GDP and population
projections8. The weighted average regional growth rate for the seven East African
countries for the 2009-2015 period is 6.2 percent. The CDS trade growth rates represented
by the preceding tables are summarized in Figure 4-5. The growth rates for trade from
2008 to 2009 show that despite the economic turndown, the region as a whole experienced
substantial trade growth. This growth is forecast into the future with rapid recovery of
exports in the short term and moderating growth in the longer term.

Except for Burundi, higher growth is forecast in the 2009-2015 for all other countries
shown and a tapering from 2015-20 and 2020-30. For 2009-2015, growth is between 6-7
percent annually except for Ethiopia at 7.5 percent and Burundi at 4.7 percent. From 2015-
20 and 2020-30, the average annual growth rate is between 5 and 6 percent generally.

Figure 4-5
Average Annual GDP Growth Used in the CDS Forecast, 2009-2030 (percent)

Source: Nathan Associates Inc.

FORECAST OF EAST AFRICAN TRADE

Trade projections were prepared for the flows between eight countries of East Africa
region, as well as flows between East Africa countries and overseas regions for the years
2015 and 2030. Trade projections were made using a regression analysis, based on GDP
and population projections. Figure 4-6 presents the average annual growth in imports and
exports by country for the periods 2009-2015 and 2015-2030. Expected trade growth in the
period 2009-2015 exceeds that of 2015-2030; in some cases more than by double: in
Burundi, Rwanda and Uganda for exports and imports; and in Eastern DRC and Ethiopia
for imports. The highest growth expected in imports is in Eastern DRC (16 percent),
Rwanda (13 percent) and Kenya (13 percent) for 2009-15; and Eastern DRC, Kenya and

8 A complete description of the forecasting methodology is presented in CDS Action Plan, Volume 2,
Technical Paper B. on Trade and Traffic Forecasts.
 65

Tanzania in the period 2015-2030, with an expected growth rate around 7 percent. For
exports, Rwanda and Burundi are expected to have the highest growth in 2009-2015.9
After 2015, export growth is expected to overtake import growth in most countries,
Eastern DRC (13 percent), Ethiopia (13 percent), Rwanda (12 percent) and Burundi (9
percent).

Figure 4-6
Average Annual Trade Growth by Country, 2009-2015 and 2015-2030 (percent)

*The value for Sudan Exports (66 percent) is not to scale

Source: Nathan Associates Inc.

FORECAST OF NORTHERN AND CENTRAL CORRIDOR TRAFFIC

Tables 4-5 and 4-6 present the forecast of Northern and Central Corridor traffic for 2015
and 2030, respectively. Total traffic on the two corridors is forecast to increase from 28.6
million tons in 2009 to 52.5 million tons in 2015 and to reach 143.1 million tons by 2030.
Those volumes correspond to an average annual growth rate of 11 percent between 2009-
2015 and 7 percent between 2015 and 2030. In both corridors, for most of the years
considered, domestic traffic makes up more than half of corridor traffic.

9 The reason Sudan is not mentioned here although the graph shows 66% export growth, is due to the fact
that this growth is from a small base and therefore
 66

Traffic on the Northern Corridor is forecast to increase at an annual rate of 9 percent from
2009 to 2015—from 21.5 million tons to 35.3 million tons. Growth by type of traffic is
relatively balanced, with transit, regional and domestic traffic each growing at an annual
rate of 8–9 percent. Although the annual rate of growth decreases to 6 percent from 2015
to 2030, traffic on the Northern Corridor is forecast to increase from 35.3 million tons in
2015 to 89.6 million tons by 2030.

Table 4-5
Forecast of Northern and Central Corridor Traffic by Type and Mode, 2015 (000 tons)

Average Rail
Growth/yr Share
Type of Traffic Road Rail Total 2009–2015 (%)

NORTHERN

Transit 6,883 3,142 10,025 9% 31%

Regional 4,764 202 4,966 8% 4%

Domestic 19,259 1,014 20,273 8% 5%

Total 30,906 4,358 35,264 9% 12%

CENTRAL

Transit 1,584 1,440 3,024 36% 48%

Regional 1,417 58 1,475 13% 4%

Domestic 12,138 639 12,777 14% 5%

Total 15,139 2,137 17,276 16% 12%

Total 46,046 6,495 52,540 11% 12%

Source: Nathan Associates Inc.

Table 4-6
Forecast of Northern and Central Corridor Traffic by Type and Mode, 2030 (000 tons)

Average Rail
Corridor and Type Growth/yr Share
of Traffic Road Rail Total 2015-2030 (%)

NORTHERN

Transit 16,524 8,145 24,669 6% 33%

Regional 10,517 442 10,959 5% 4%

Domestic 51,253 2,698 53,950 7% 5%

Total 78,294 11,285 89,578 6% 13%

CENTRAL

Transit 6,341 4,450 10,791 9% 41%

Regional 2,479 91 2,570 4% 4%

Domestic 38,320 1,888 40,209 8% 5%

Total 47,140 6,429 53,570 8% 12%

Total 125,434 17,714 143,148 7% 12%

Source: Nathan Associates Inc.

 67

Central Corridor traffic is forecast to have a higher rate of growth than the Northern
Corridor for both the 2009-2015 and 2015-2030 periods. From 2009-2015 traffic on the
Central Corridor is forecast to increase at an annual rate of 16 percent, from 7.1 million
tons in 2009 to 17.3 million tons in 2015. From 2015-2030, growth is forecast at 8 percent
annually and to increase from 17.3 million tons in 2015 to 53.6 million tons in 2030. Traffic
volume that goes through the Northern Corridor in 2030 is expected to be 67 percent
higher than that of Central Corridor.

Regarding type of traffic, transit traffic is forecast to jump substantially from 468 thousand
tons in 2009 to 3.0 million tons in 2015, an average annual increase of 36 percent. This
however, reflects growth from a depressed level of traffic in 2009 due to operational
problems with the TRL rail system and the effects of a track washout. In both corridors,
domestic traffic usually makes up more than half of corridor traffic. In 2009, domestic
traffic made up 58 percent of Northern Corridor traffic, whereas in Central corridor this
share was 85 percent. The share of domestic traffic in Northern Corridor is expected to
slightly increase to around 60 percent by 2030, while it is expected to fall by 10 percentage
points in Central Corridor. The composition of each corridor’s traffic by type is presented
graphically in Figure 4-7.

Figure 4-7
Forecast of Northern and Central Corridor Traffic by Type, 2009-2030 (mt)

Source: Nathan Associates Inc.

During the forecast period, there is an overall increase in share of rail as a mode in the
total corridor traffic from 6 percent in 2009 to 12 percent for 2015 and 2030. For transit
traffic of Northern Corridor, the share of rail is expected to increase from 7 percent in 2009
to 33 percent in 2030.
 68

IMPLICATIONS FOR CORRIDOR INFRASTRUCTURE

The amount of traffic forecast for the Northern and Central Corridors will overwhelm the
existing infrastructure and will obvious require substantial investments throughout the
forecast period. Some of the implications of the traffic forecast are highlighted below.

• Unconstrained traffic growth implies large future demand on ports, highways

and rail.

• Port capacity will need to increase by 24 million tons by 2015 and 117 million tons
by 2030

• Road network needs to be able to handle 80 percent more traffic by 2015 and 4
times more traffic by 2030

• Rail network needs to also be able to increase its traffic from 3 million tons to 6.5
million tons in 2015 and 17.7million tons (11million RVR and 6.5 million TRL) by
2030

• If capacity is not increased, congestion at ports and on roads will reach epic levels
and constrain economic growth

There is a clear need for substantial and targeted investment in regional transport
infrastructure now and continuing for the next several decades.

Alternative Trade and Traffic Scenarios

Earlier in this chapter, trade and traffic projections based on expected GDP growth and a
“Base Case” scenario were presented, where it was assumed that the proposed projects
for corridor improvement are to be implemented in the future. In order to evaluate the
sensitivity of this analysis based on different conditions than what is expected, in this
section the assumptions on GDP and corridor improvement scenarios are altered10.

LOW GDP GROWTH SCENARIO

First, a scenario with lower GDP growth is considered; 40 percent less per year than the
rate of growth assumed for the Base Case traffic forecasts. Thus if a country had an annual
GDP growth rate of 6.0 percent in the Base Case, it would have a growth rate of 3.6
percent (40 percent lower) in the Low GDP Growth scenario. The Base Case assumption
on having implemented recommended projects for corridor performance improvement is
kept intact. New trade and traffic values were calculated based on lower economic
growth. Figure 4-8 and Figure 4-9 show the average annual growth rate for imports and
exports by country for the Base Case as well as Low Growth scenarios for the periods of
2009-2015 and 2015-2030, respectively.

10 Another alternative trade and traffic forecast scenario that corresponds to a “Worst Case Scenario” is
presented in Chapter 9.That scenario consists of the Low GDP Growth forecast plus a deterioration in the
performance of the two corridors if proposed improvements are not implemented.
 69

Figure 4-8
Comparison of Average Annual Trade Growth by Country, Base Case vs. Low Growth, 2009-2015
(percent)
Base Case

25

20

15

10 19.6 23.3
16.5 16.0
13.6 13.0 14.4 12.7 13.6
5 11.2 10.6
6.1 7.2
3.5
0
Burundi Eastern DRC Ethiopia Kenya Rwanda Tanzania Uganda

Imports Exports

Low GDP Growth

25

20

15
19.0 22.9
10
15.9 15.2 13.8
12.4 12.1 13.4
5 10.6 10.0
5.5 5.6 3.0 7.0
0
Burundi Eastern Ethiopia Kenya Rwanda Tanzania Uganda
DRC

Imports Exports

Source: Nathan Associates

As a result of 40 percent lower GDP growth per year, in 2015, total trade is expected to fall
from 90.1 million tons to 86.8 million tons; a decrease of 3.7 percent. In general, the
resulting decrease in trade for the regional economies is in the range of 1 to 4 percent from
the Base Case, with the exception of the impact on DR Congo’s exports (36 percent). This
translates into 8.5 percentage points difference in growth for this country, in the case of
lower growth. The impact on imports is uniform across the region, 3 percent decrease in
trade compared to the Base Case, with the exception of DR Congo (4 percent). The results
vary more for exports than imports, the change from Base Case being as little as 1 to 2
percent for Kenya, Rwanda and Uganda. The relatively small decline in the trade forecast
for the Low Growth Scenario for 2015 is due to the limited years for the lower GDP
growth impact to have a compounding effect. As can be seen from the discussion below,
by 2030, the impact on trade and traffic is more pronounced by 2030.

Figure 4-9 compares the Base Case scenario trade to low growth scenario trade for the
years 2015-2030. More substantial decreases can be seen in this period; total trade is
expected to fall from 237.5 million tons to 194.4 million tons, a decrease of 18 percent.
Similar to the 2009-2015 period, a large decrease in Eastern DRC exports are observed;
11.7 percentage points less than growth in the Base Case. Burundi exports follow by an
 70

estimated drop of 37 percent from the Base Case scenario. Ethiopia’s exports would also
see a relatively large decrease of 13 percent. In terms of imports, the decrease across the
region is still uniform (9 percent) with the exception of DR Congo (13 percent).

Figure 4-9
Comparison of Average Annual Trade Growth by Country Base Case vs. Low Growth, 2015-2030
(percent)
Base Case

25

20

15

10
13.1 13.4 12.2
5 9.2 7.2 6.8 4.5 6.1 7.1 6.7
3.2 0.9 4.1 5.5
0
Burundi Eastern DRC Ethiopia Kenya Rwanda Tanzania Uganda

Imports Exports

Low GDP Growth

25

20

15

10 12.6
6.5 6.3 11.7 6.7
5.6 3.6
5 2.7
6.2 0.5 6.2
1.4 4.0 5.0
0
Burundi Eastern Ethiopia Kenya Rwanda Tanzania Uganda
DRC
Imports Exports

Source: Nathan Associates

Tables 4-7 and 4-8 show the effect of a low GDP growth scenario on expected traffic
values in the future. The total traffic in year 2015 is estimated to drop from 54 million tons
to 51 million tons (a decrease of over 6 percent) and in year 2030 the drop is expected to be
from 145 million tons to 128 million tons, a decrease of 10.5 percent. Generally, the impact
of lower growth on Central Corridor traffic is slightly higher than on Northern Corridor.
In terms of modal shares, there is no significant difference from the Base Case scenario.
 71

Table 4-7
Low GDP Growth Traffic by Corridor and Mode, 2015 (000 tons)
Corridor and AAGR (%) Rail
Road Rail Total
Type of Traffic 2009-2015 Share (%)

Northern
Transit 6,594 3,013 9,607 8.4 31.4
Regional 4,604 195 4,799 7.4 4.1
Domestic 18,748 987 19,735 8.0 5.0
Total 29,946 4,195 34,141 8.0 12.3
Central
Transit 1,514 1,348 2,862 33.6 47.1
Regional 1,369 55 1,424 12.8 3.9
Domestic 11,763 619 12,382 13.1 5.0
Total 14,646 2,022 16,668 15.3 12.1
Total 44,592 6,217 50,809 10.1 12.2

Source: Nathan Associates

Table 4-8
Low GDP Growth Traffic by Corridor and Mode, 2030 (000 tons)

Corridor and AAGR (%) Rail

Road Rail Total
Type of Traffic 2015-2030 Share (%)

Northern
Transit 14,585 6,993 21,578 5.2 32.4
Regional 9,501 397 9,898 4.7 4.0
Domestic 46,507 2,448 48,955 6.1 5.0
Total 70,593 9,838 80,431 5.7 12.2
Central
Transit 5,334 3,666 9,000 7.5 40.7
Regional 2,231 79 2,310 3.0 3.4
Domestic 34,773 1,685 36,458 7.2 4.6
Total 42,338 5,430 47,767 7.0 11.4
Total 112,931 15,267 128,198 6.1 11.9
Source: Nathan Associates
 72

Figure 4-10
Comparison of Traffic in Northern and Central Corridors- Base Case vs. Low GDP
Growth Scenarios, 2015 and 2030 (million tons)
Northern Corridor Central Corridor

95 BASE CASE LOW GROWTH 60 BASE CASE LOW GROWTH

85 Reg 2.6
Reg 11.0
50
75 Reg 9.9
Transit 12.1 Reg 2.3

65 Transit 24.7
Transit 9.0
40
Transit 21.6
55

30
45

35 Reg 5.0
Reg 4.8 20 Domestic 40.7
Domestic 36.5
Transit 11.7 Domestic 54.0 Reg 1.5
25 Transit 9.6 Domestic 49.0 Reg 1.4
Transit 3.2 Transit 2.9

10
15

Domestic 20.3 Domestic 19.7 Domestic 12.8 Domestic 12.4

5
0
2015 2030 2015 2030 2015 2030 2015 2030
‐5

Source: Nathan Associates

The decrease in traffic can be clearly seen in Figure 4-10, especially by year 2030. Under
the Low GDP Growth scenario, traffic in Northern Corridor by 2030 is estimated to fall
from 89.6 million tons to 80.4 million tons; a reduction of more than 10 percent. For
Central Corridor by 2030, traffic would decrease from 55.3 million tons to 47.8 million
tons, equivalent to about 14 percent decrease. In terms of types of traffic, the largest
impact would be expected on transit traffic, which in year 2030 would fall from 24.7
million tons to 21.6 million tons in the Northern Corridor (12.5 percent decrease). In the
Central Corridor, this decrease by 2030 is expected to be even larger, 25.6 percent, a
change from 12.1 million tons in 2030 to 9.0 million tons.
 73

5.Strategies for Improving

Corridor Performance
Improving the efficiency and reliability of the Northern and Central Corridors will require
the adoption and implementation of an integrated Action Plan to simultaneously address
infrastructure constraints and bottlenecks and operational inefficiencies, policies and
procedures. In this section, we present proposed strategies that can improve corridor
performance immediately or within the next five years. While the strategies should be
considered as a whole as part of the integrated Action Plan, for presentation purposes
they are discussed below under individual components of the corridor’s logistic chain.

Maritime Ports
As the gateways for the two corridors, the ports of Mombasa and Dar es Salaam must
have adequate capacity and be able to perform efficiently in order for the overall corridor
performance to improve. If measures are not undertaken to address the constraints,
bottlenecks and inefficiencies at the ports, the corridor performance will continue to suffer
even if all other components of the logistics chain are improved. In the sections below, we
propose strategies for increasing the capacity and efficiency of the two ports in the next
five years to handle the volume of containers, dry bulk and liquid bulk cargo that is
forecast.

CONTAINER OPERATIONS
The diagnostic assessment of the ports of Dar es Salaam and Mombasa has identified
capacity constraints and low productivity as the key challenges for improving container
operations. An optimized port / ICD integration program is proposed as a short-term
solution to alleviate such capacity constraints; by transferring cargo handling at the
marine terminals container yards to near port ICDs. Both ports have master plans
defining long-term development projects, including new container terminals, which
would ease capacity constraints and increase berth productivity considerably. However,
the issues around congestion at these ports can cause significant obstacles to port
operations until these projects are completed, with new terminals expected to be
commissioned at least three to five years or 2013–2015. The ICD Integration Program
 74

could address these issues effectively, ensuring smooth operations at these ports in the
interim.11

The main thrust of the ICDs Integration Program is relocating all container processing
activities from the marine terminals to ICDs, including all the handling of outside trucks.
This “cleaning” of the marine terminals requires the integration of the ICDs with marine
terminals. This integration means that the ICDs’ yards substitute the marine container
yards and the ICDs gates substitute the marine terminals’ gate. The suggested changes are
operational and institutional measures that do not require investment in new port
facilities. They can be implemented in a short time period and increase capacity at these
ports in the short term.

Figure 5-1
Use of Tractor for Container Transfers

With the integrated ICDs, marine terminals will no longer need to interact with cargo
owners, but only with shipping lines. A simple block storage system is recommended in
the yard given all inbound boxes are destined to ICDs, which would eliminate the need
for RTGs. Segmentation of the marine terminal into berth and gate sections will improve
the productivity of truck handling and the entire transfer operation under the full control
of ICDs.

Road connection between ICDs and ports will be improved and traffic surrounding the
ports is expected to decrease since it will be distributed to the various ICDs involved in
the operations. It is proposed that shipping lines contract with ICDs, where prices would
be set according to performance level, which would introduce competition between the
ICDs. The Program includes a system for licensing and regulating ICDs, given that their
role will increase under the proposed changes. The extra cost involving transfer via ICDs
are compensated by the much higher savings arising from reduction of dwell time of
ships and higher productivity of expensive port facilities and equipment.

11 A fuller description and discussion of the Integrated ICD concept is presented in Appendix H of the
Action Plan Volume 2, Supporting Technical Papers.
 75

DRY BULK AND GENERAL CARGO

Container traffic has tended to attract the most attention from port managers as the most
visible, high growth area. Nevertheless, dry bulk has also been increasing substantially.
Between 2002 and 2007, containers at Mombasa increased by 14 percent in tonnage, while
dry bulk increased by 20 percent. At Dar es Salaam, container traffic increased by an
average of 13.5 percent, while wheat averaged 16 percent during the same period.
Therefore, while concentrating on improving the performance of container handling, it is
important to seek performance improvements for dry bulk as well.

Figure 5-2
Mombasa Bulk Facilities (Cement and Flourspar)
Both ports are giving attention to this
segment of traffic, which is complex
because each product is handled
differently. Both ports are designating
an area of dry bulk berths and
seeking to develop faster handling
systems. This includes installation of
better cranes, conveyor systems,
systematic yet flexible assignment of
berths, and reviewing silo and other storage systems. Both ports are also seeking to
deepen the berths to allow for larger ships that can increase port throughput and reduce
operating costs for the ports and the logistics costs for the shipper. Because a major
impediment to Mbaraki Wharf at Mombasa is a bridge access that limits truck size to 7
tons. Removing bulk requires two moves, with time lost, increased cost and air pollution
resulting from double handling of dry product. Therefore two new access bridges are
featured in Mombasa’s dry bulk initiatives.

General cargo is static or has decreased as more cargo is moved in containers. In both
ports, it tends to be handled wherever there is a berth with sufficient depth and
availability. Both ports are seeking a plan for more effective general cargo handling,
however, some of the plans cannot be realized until excess containers are removed from
the general cargo area.

LIQUID BULK
The ports of Dar es Salaam and Mombasa each require the development of additional
capacity to handle liquid bulk cargo. In Mombasa, Kipevu Oil Terminal handles crude oil
and refined oil products and can accommodate vessels to 85,000DWT and up to 198 m
long. In 2008, it was at 78 percent berth occupancy and in 2009 was at 86.5 percent. Vessel
delays to berth currently cost the petroleum industry an average of US$ 100 million
annually. The Port of Dar es Salaam and particularly the Kurasini oil terminal is
congested with frequent wait times off shore and terminal delays. All these delays
increase the cost of delivered fuel.
 76

For both ports, offshore petroleum offloading facilities are planned/being developed to
meet the need for additional liquid bulk capacity through design of a BOT project for a
single buoy point or off shore jetty system. In Mombasa, an international tender was
issued by the National Oil Corporation of Kenya in late 2010 for a technical feasibility
study of the construction of an offshore petroleum offloading jetty at Mombasa. It is
expected that a contract will be issued during 2011. In Dar es Salaam, the project consists
of construction of the SPM and two subsea pipelines. The SPM is being constructed
southeast of the harbor entrance and will accommodate ships from 40-150 KDWT.

Lake Ports
From a macro economic perspective the cost advantages of the rail/lake system give
reason for focusing on its development as a long haul alternative to a truck/highway
system into the region abutting Lake Tanganyika. The Ports of Kigoma, Bujumbura and
Kalemie are reasonably well developed and can easily handle containers if the shipping
fleet was reconfigured to handle them. The key requirements for developing an efficient
low cost container distribution system via Lake Tanganyika to the adjoining countries are:

• Frequent delivery of block trains carrying 40-60 TEU from Dar to Kigoma

• A system for rapidly transferring the containers from the rail to the lake shipping
service

• A low cost shipping service calling the principal ports on the lake

• A system for rapidly discharging the vessels and turning the containers around

• The cheapest and most efficient distribution system to meet these criteria would
be a rail-tug/barge feeder system.

BARGE FEEDER SERVICES ON LAKE TANGANYIKA

It is envisioned that because of its rail connection with Dar es Salaam, Kigoma would
function as the hub port for the proposed container barge distribution services on Lake
Tanganyika. There are a number of options. Initially, an alternating pendulum service can
be set in which Bujumbura and Kalemie can be serviced once a week. If multiple barges
are put into service then there is the option of establishing a three or four port itinerary
service depending on demand. The only investments that will be needed in the receiving
ports are the purchase of yard tractors and the development of secured, hard packed, and
bonded holding area for clearing customs and stripping containers as needed. Finally,
because of its versatility it can also function as a truck ferry servicing the local commercial
markets.

BARGE FEEDER SERVICES ON LAKE VICTORIA

Lake Victoria has a different trade and distribution dynamic. The design of each of the
different ports on the lake includes facilities for the mooring of rail wagon ferries. When
these were developed in the 1960-70s the national railroads of Tanzania, Kenya and
Uganda were a part of the now defunct East Africa Railways Corporation and was
operated as one coordinated system. Currently, there are two separate railroads—the TRL
 77

serving Mwanza and Port Bell and the RVR serving Kisumu, Port Bell, and Jinja. The
natural competition therefore is between the TRL at Mwanza and RVR in the other ports.
A second competitive option is for RVR to improve their rail track and service to Kisumu
and offer a cheaper short cut service to Port Bell in Uganda. In the past both of these
services have been offered using rail wagon ferries. However, the operating and
maintenance costs of these vessels combined with a low carry capacity greatly increases
the economic risk of such a venture in the present circumstances.

Figure 5-3
Cargo Handling at Lake Port
There are several options for developing container
distribution services on the lake. One option is to
convert the working rail wagon ferries to RoRo
operations handling containers on chassis which
with proper loading could increase their container
carrying capacity by 15-25 percent. The logical
services would be Mwanza to Kisumu or Mwanza
to Port Bell and Kisumu to Port Bell. However there
are problems associated with this option. First of all
the vessels are old (built 1960’s) and require
extensive modernization and maintenance. Also,
they are expensive to operate, and because of their
inherent design limitations cannot maximize their
revenue capacity to operating cost ratios in
comparison to a tug barge operation. Therefore the preferred option would be to design a
RoRo barge that can utilize the rail wagon mooring facilities at each of the ports while
more than doubling the carrying capacity of the vessel per voyage. For this option the rail
link system would have to be modified to facilitate the easy on and off movement of the
trailers and containers. As in Kigoma the rail links into Mwanza and Kisumu will need to
be improved and holding yards must to be developed as well. More importantly the ports
need to be equipped with reachstackers or heavy forklifts to transfer the container from
the flat cars to chassis and vice versa. Needless to say chassis pools would need to be
developed in both rail head ports.

Rail
The East Africa regional railway systems are not functioning as they should, in virtually
all respects – poor reliability, high accident and failure rates, high costs, low volumes,
financially loss making and not operationally sustainable. The reasons for this have been
well debated and studied for many years and are also well understood – initial loss of
volumes and income from road transport deregulation, followed by lack of investment
and deferred maintenance, leading to declining reliability and further loss of traffic.

The future development strategy for railways in East Africa will be governed by the need
to further develop and upgrade existing systems and to invest in new systems, in order to
 78

minimise the overall effects of increasing oil prices and more stringent environmental
targets. Despite the ongoing poor performance of the railway systems in Africa, there
seems to be no other option than to work towards a revival and expansion of the railway
services, with the lead taken by government commitment and investment in
infrastructure, supported with development partners, and to encourage and permit
private sector participation in operations.

The only feasible option is for the railway operators to prepare realistic and detailed
business plans, focussed only on the core activities necessary to increase targeted bulk
and intermodal freight volume. Detailed cash flow projections will have to be prepared,
linked to performance targets and agreements/MOUs with key customers, showing the
long term and short term financing requirements. Experienced management support will
be necessary to prepare the business plans, to present the plans to potential funders and
to implement them – it seems likely that donor support could be found for the cost of the
initial management input in case of such need. Alternatively this could be sourced from
private financing where possible such is the case for RVR.

In simple terms, the regional railways will all have to increase their freight volumes
substantially in order to become viable. The regional railways will need to target the
container sector in order to achieve the threshold volumes – this will lead to increased
competition with road. Focusing on bulk traffic will in most instances not be enough. The
main problem is that there is not enough traffic to go around. Building new lines and
linkages will not be viable without significant improvement of the current system, unless
linked to specific contracted anchor projects (such as the possibility of the nickel mining
sector in Tanzania or the oil sector in Uganda).

REVITALIZATION STRATEGY FOR TRL

It is proposed that donor funding be sought for the appointment of a new experienced
management team, which should prepare a realistic business plan, based on core
business, to serve as a basis for refinancing of TRL. It is estimated that investment of the
order of US$ 110 million will be needed, excluding rolling stock, but including working
capital. The TRL service remains critical for serving the eastern DRC, Rwanda, Burundi,
and to a lesser extent Uganda, both in respect of international and regional trade. Given
the recent experience, the possibility of a new railway concession is not appealing. The
Kenya railway operator, RVR, through its new shareholder Citadel, has expressed an
interest to operate its own trains on the TRL system, and Burundi logistics companies
have expressed the same interest, if the TRL line can be extended into Burundi territory.
TRL will have to target the intermodal freight sector in order to achieve the minimum
freight volume required for financial viability.

Priority investments to improve infrastructure in support of TRL revival plan include:

• Target increase traffic from 0.5 million tons in 2010 to 2 million tons in 2015

• Enhance capacity by replacing light rails with heavier sleepers and rails of 80
lb/yard and rehabilitating bridges to at least 25-ton axle load capacity.
 79

• Rehabilitation of track especially between Kilosa and Gulwe stations i.e. bridges
to at least 25-ton axle load capacity (area of recent washaway).

• Rehabilitation of rolling stock

• Lease rolling stock.

• Construction of inland container terminals at Ilala (Dar es Salaam), Shinyanga

(Isaka) and Mwanza in order to assist decongestion of containers at the port of
Dar es Salaam.

REVITALIZATION STRATEGY FOR RVR

The main commercial shareholding in RVR has been taken over by Citadel of Egypt, a
resourceful financial services group with major investments in transport infrastructure
and operations. RVR has concluded a management and technical services agreement with
América Latina Logística (ALL) of Brazil, an experienced railway operator. RVR has
expanded the Ugandan concession to include the Tororo–Pakwach section. Rehabilitation
of the worst sections of track in Uganda and Kenya has commenced. The RVR lake ferry
service between Kisumu and Port Bell has been revived. Priorities for the short term
include:

• Target to increase traffic from current 1.5 mtpa to 4.5 mtpa during first phase –
implies a shift of traffic from road to rail.

• The two Uganda wagon ferries are due to be returned to service during 2011, and
will likely be used on a triangular service Port Bell – Mwanza - Kisumu

• Commence track repair and upgrading in worst sections – Jinja section in

Uganda, in order to improve reliability, track capacity and transit times

• Commence locomotive rehabilitation and resume maintenance procedures in

order to reduce locomotive failures

• Increase freight volume - target container sector, operate block trains develop and
expand intermodal terminals at Nairobi and Kampala

• Resume lake ferry services from Port Bell and Kisumu

• Priorities for the medium term include:

• Improve rail access to the existing and future container terminals – operate longer
scheduled block trains from the port

• Target Ugandan oil sector as a major anchor customer.

• Motivate increased state investment in upgraded track infrastructure, Kenya and

Uganda – gradually upgrade track to more than 20-ton axle loads

• Integrate and coordinate future planning with KPA Lamu Corridor programme
 80

Roads

ROAD INFRASTRUCTURE
As described in Chapter 2, an assessment of Northern Corridor road network was carried
out by Aurecon for the East African Transport Strategy and Regional Road Sector
Development Program conducted for the EAC in 2010. This assessment resulted in the
identification of three categories of road improvements:

• Upgrade Road Capacity. Immediate remedial action, in terms of proving

additional capacity principally by adding lanes (e.g. climbing lanes or extra
lane(s) for the whole identified length) is recommended for roads with level of
service E and F. Roads with LOS D and C are to be investigated for remedial
action later.

• Rehabilitation of Paved Roads is triggered for a paved road once its overall
condition has deteriorated beyond the point where preventive and routine
maintenance can uphold the pavement at a functional level.

• Upgrade to Paved Standards. Gravel roads with traffic volumes in excess of 200
vehicles per day operate under poor riding quality conditions and generate
excessive costs to road users as well as escalating routine maintenance costs to
the road authorities.

Figure 5-4
Improved Corridor Road to Four Lanes and Divided Highway

IMPROVED VEHICLE OVERLOAD CONTROL SYSTEM

Article 90(l) of the EAC Treaty commits the partner states to adopt common rules and
regulations governing the dimensions, technical requirements, gross weight and load per
axle of vehicles used in trunk roads within the Community. Under the guidance of the
EAC Secretariat and with donor support, partner states reached agreement in July 2008 on
the harmonization of axle mass loads, gross vehicle mass limits, the adoption of a formula
for the protection of bridges and tolerance factors for overloads (i.e. grace percentages
which do not attract penalties). Agreement was also reached to ban quadrem axles and to
decriminalize overloading by adopting a system of administrative penalties to recover the
economic cost of damage inflicted by overloaded vehicles.
 81

All states are making major investments in improving road infrastructure, including in
some cases, contracting for road management by private firms. Effective overload control
is essential to extract maximum economic benefit from this investment. Investment in
railway systems is also ongoing and the ability of rail to compete effectively with road
transport also depends – significantly - on effective measures to combat overloaded
trucks.

Despite the agreement reached in 2008, there has been little progress by Member States in
amending their legislation to adopt the harmonized regional standards. Moreover, only
Tanzania has introduced the agreed system of administrative penalties based on the
recovery of actual economic costs of road damage.

Existing overloading control strategy is aimed at achieving 100 percent inspection of all
commercial vehicles. There is no targeted risk management approach and no incentive to
encourage truckers to self-regulate. The high intensity of checking increases journey times
and provides an added incentive for corruption. Differences in national limits complicate
cross-border operations. There is also no regional consistency in terms of the frequency of
checks as some states (Burundi, Rwanda) have no existing weighbridge infrastructure.

Experience elsewhere has highlighted that the efficacy of overload controls is improved
when the trucking industry is fully cognizant of the content of the new rules and their
application. Outreach activities to sensitize the trucking industry to the implications of the
new rules are useful to ensure smooth implementation of the administrative system and
to secure the co-operation of industry – from an early stage – to improve compliance
levels. At the same time, training of weighbridge staff and law enforcement officers in the
implementation of the new rules is also needed. Provision therefore needs to be made to
conduct workshops and information sessions with the trucking industry (once legislation
is finalized) and to hold practical training sessions with weighbridge personnel and
enforcement personnel.

Technical assistance is initially required to assist member states to align legislation on

vehicle limits with regional standards and to pass new regulations providing for
administrative penalties. All states need to revise legislation to adopt the regional limits,
although Tanzania has already adopted new rules providing for administrative penalties.

In the longer term, technical assistance can be extended to develop a regional overloading
control strategy which utilizes targeted enforcement techniques based on risk
management. This includes focusing on specific vehicles and cargo types prone to
overloading, establishing databases to develop profiles of frequent offenders and
adopting additional enforcement measures to target high-risk truckers. Additionally,
measures to encourage self-regulation, such as the accreditation of compliant truckers
who qualify for more lenient treatment based on their compliance records, can be
introduced.

Co-operation by line function ministries and Attorney-Generals’ Chambers to process

legislation is a critical precondition for success. Without a legislative basis, the remaining
components of the technical assistance cannot be implemented.
 82

Border Posts and Trade Facilitation

The Northern and Central Corridors serve the East African Community and the
surrounding states of the Democratic Republic of Congo (DRC), Sudan and to a lesser
extent Ethiopia. The East Africa Community previously operated with a single Customs
service; however, with the breakup of the first EAC this service became national bodies
implementing full national controls at the borders. Nevertheless, Kenya, Uganda and
Tanzania have similar regulations and operations. Rwanda and Burundi are now being
incorporated into the common regulations and procedures developed for the
implementation of the EAC Customs Management Act.

A task force of the Partner States is leading a program designed to modernize and
harmonize the operations of customs and other border agencies and to encourage EAC-
wide adoption of successful pilots. Examples of these efforts include:

• An active risk management team in Uganda RevenueAuthority that has been

providing training to other Partner States and on-site advising in risk
management techniques.

• An accredited economic operator program is being introduced so that Revenue

Authorities will recognize compliant shippers, forwarders and/or transporters
with expedited border clearances.

• Rwanda has introduced a blue channel which enables customs compliant

companies to clear within a half day in Kigali. Other companies continue to have
full inspections and 1-2 day clearances.

• A project team is developing a border information system for implementation

throughout EAC.

• The newly established Burundi Revenue Authority is being assisted with

computers, interconnectivity and capacity building on customs modernization
programs.

APPROACH TO IMPROVING FACILITATION AND PRIORITY INITIATIVES

Decision-makers need to be able to quantify benefits. CDS provides this quantification to
use in making the case for change and to provide a baseline with which to monitor.
Initiatives should be results-oriented with a methodology for setting targets included in
the intervention. Task teams should be motivated from within the agencies and private
sector agents impacted. PPP approaches are more likely to be demand driven and to
operate fast. Timelines should be set by the task teams and monitored.

Many of the border facilities are inadequate to the increasing traffic on the Northern and
Central Corridors. A table depicting the Corridor border traffic, time delays, facilitation
issues, OSBP status and CDS priority is in Section 8. There are committed funds to
construct new border posts at the main borders on the Corridors. These programs should
be expedited, especially on the priority borders listed below.
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Northern Corridor
Malaba (Kenya/Uganda) is the busiest regional border. It has been the subject of
assistance from several sources, but financing the two lane bridge(s) and border facilities
needed has been delayed. Constructing the bridge and new border posts are the highest
priority.

Gatuna/Katuna (Uganda/Rwanda) is located in a marshy area making construction more

difficult. It has adopted 24 hour operations and stakeholders are doing joint planning for
the One Stop Border facilities.

Nimule (Uganda/Sudan) is likely to see increasing traffic as southern Sudan moves

toward independence. Currently, clearances are done by Uganda about 20 km from the
border and by Sudan at the border. Documents are acquired at the Sudanese border.
There are still many security problems and trucks drive to Juba in 10 truck convoys in
daylight and without stopping. New facilities are needed and greater security.

Central Corridor
Rusumo (Tanzania/Rwanda) is the main Central Corridor crossing into Rwanda.
Challenges are presented by the terrain and river. A two lane bridge and new border
posts have been designed. Import clearances are not done at the border now, but the new
facilities will have inspection facilities and an expanded area to allow full clearances to be
done at the border.

Kabanga/Kobero (Tanzania/Burundi) is the main Central Corridor crossing into Burundi.

The terrain doesn’t pose a problem, but utilities need to be addressed. Currently, the
borders are far apart. The design should accommodate the introduction of a One Stop
Border Post and clearing at the border.

Construction is also advanced for Mutukula (Uganda/Tanzania). After these borders are
addressed, construction should be planned for Gisenyi/Goma (Rwanda/DRC),
Bukavu/Rusizi (Rwanda/DRC) and Akinyaru/Kinyaru Haut (Rwanda/Burundi).

GENERAL IMPLEMENTATION ISSUES

Every border on the two Corridors should have electricity and internet connections. In
the validation, it was observed that once the border agencies have electricity and
computer connections, the private sector follows the agencies to the border and connects
to the grid. Many initiatives for making trade seamless involve more effective use of
information technology. There are programs in the region for effective information
sharing among control agencies at a border in management information systems.
Secondly, border agencies need to be able to send data to headquarters for consolidation.
ICT applications provide major time savings.

It is critical to support the programs that reward compliance and use risk management
more effectively to control abuses while expediting cargo for compliant traders and
operations. It is equally important that procedures are harmonized through the customs
union so that documentation is prepared once for the entire corridor and the procedures
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at each border are similar. Capacity building should be emphasized sp that Revenue
Authorities that have developed new systems are able to share them with other Revenue
Authorities through training programs, site visits or attachment to an agency to fully
understand the new procedures. This type of capacity building supports modernization
and harmonization among the Partner States.

The East African Community committed to make all its borders One Stop Border Posts
(OSBP). OSBP are not a panacea for border delays, but coupled with expedited
procedures and an attitude that supports trade facilitation, they can cut transit time by
half or more. Working in close proximity fosters cooperation and enables joint
inspections and joint processing. Establishment of OSBPs requires four basic components:
an enabling legal framework, physical facilities, expedited procedures, and ICT for
effective communication, information sharing and electronic processing. A proposed
OSBP Act has been drafted and negotiated for the EAC and is being introduced to the
Legislative Assembly for passage in first half 2011. Integrated implementation of these
components is necessary to success. Table 5-1 illustrates the initiatives in implementation
and the gaps. ICT applications are in various stages of development. Coordination will
be very important.

Table 5-1
Commitment of OSBP Components for Priority Borders
Gatuna/ Kobero/
Component Malaba Katuna Rusumo Kabanga
Legal Framework 9 9 9 9
Physical Facilities 9 9 9 FS committed
Expedited Procedures 9 9 9
Information Systems

The licensing system for vehicles currently increases the cost and decreases the
availability of transport. It should be liberalized. Currently, Revenue Authorities in
Kenya and Tanzania license vehicles for either transit or domestic haulage. Vehicles
cannot be used interchangeably. The rules are designed to prevent diversion of transit
goods into the domestic economy, but do not take into account their impact on transport
cost and efficiency. They lead to many empty return trips and poor vehicle utilization.
Road transporters need to be allowed to make commercial decisions. The Secretariat is
also determining the procedures for implementing the Customs Union now. Decisions on
where duties are collected will affect the types of customs controls on the Corridors. A
TA is designed to review the transport time, cost and reliability impact of each of the
proposals under consideration so that as these decisions are made they take into account
their impact on transport and trade performance.

Vehicles are faced with many stops on a route. Individually they are not long, but in total
they have a significant impact on time and reliability. When they are used to demand
informal payments, they are also a cost factor. They need to be addressed by a public
campaign to stop them and monitoring that they don’t return to the Corridors.
 85

National road policies enable integrated transport systems and provide decision-makers
the justification for implementing infrastructure and facilitation measures. Regional
infrastructure needs agreements that set common technical standards, operating
regulations and a commitment to maintenance. Technical Paper D. on Regulatory
Framework and Transport Policy provides a detailed analysis of the current laws and
regulations and where there are significant gaps that affect the quality and effectiveness of
transport on the Central and Northern Corridor.

Role of Competition
Within the regions served by the Northern and Central corridors, a competitive
environment exists in the choice of alternative ports, main transport routes and corridors,
and also the modes of transportation. The competition between the different regional
transport routes, modes and ports as well as road transport operators along each corridor
is considered essential in order to:

• Ensure that transport pricing remains competitive;

• Act as an incentive for improving transit times, reliability and efficiency of
operations
• Provide flexibility in the transport systems to deal with unusual or unforeseen
events

The regional transport system is fairly unregulated – there are no rules or legislation
which specify designated routes or transport modes for certain types of freight, or certain
points of origin and destination. For example, logistics companies or managers in
Rwanda or Uganda can freely decide which port or corridor to use, Mombasa or Dar es
Salaam, and which mode of transport to use, road or rail. However, transport regulation
is carried out on a national level by each of the countries, focused on safety and
environmental issues such as permissible weights and dimensions of trucks, vehicle
testing, speed limits, etc. These national regulations affect modal competition, and until
the regulations are fully harmonized on a regional basis, also affect the choice of transport
route or corridor. For example, in the case of Rwanda and Uganda, the more stringent
enforcement of vehicle regulations and the application of penalties on the Central
Corridor has resulted in a shift of road traffic to the northern corridor, where overloading
is less strictly enforced and penalties less onerous.

The national regulations in respect of vehicle weights and dimensions, and the
enforcement procedures, are in the process of being harmonized throughout the EAC and
SADC regions, which will serve to improve the competition between the alternative
routes and corridors. However, the specified weights and dimensions are also key factors
in the competition between road and rail. Compared to international benchmarks, the
maximum gross vehicle mass (GVM) of 56 ton which is applied regionally, is among the
highest in the world. The reasons why developed countries such as the US (36 ton) and
the UK (44 ton) have adopted much lower limits for GVM, are related to the increased
cost of road maintenance, the fact that rail services become less competitive with
increasing GVM, and as a consequence, increased road congestion. However, studies have
been conducted in the EA region which have indicated a positive economic return (under
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certain circumstances) for increasing the GVM above 56 ton– this would make it even
more difficult for the revival of the regional railway sector, and possibly does not take
into account the longer term effect of increasing fuel prices (which favors rail). South
Africa has considered lowering the GVM limit in order to reduce road maintenance costs
and to promote the competitiveness of rail, but this is unlikely to be implemented in the
short term, because it will have the immediate effect of increasing overall transport costs,
and hence reducing economic growth.

Ports and Corridors

Both Mombasa and Dar es Salaam, to a large extent, serve their own captive markets or
catchment areas. International seaborne trade linked to the Nairobi economic hub can
realistically only be routed via Mombasa. Similarly, Dar es Salaam has a large captive
market, extending along the central corridor, including Burundi and areas of eastern
DRC, and also the Dar corridor including eastern Zambia and northern Malawi. The
tendency would be for the port and corridor systems to capitalize on captive markets, and
to set their pricing on the basis of what the markets can bear. However, the port and
corridor systems have large areas of overlapping catchment zones, consisting mainly of
the transit traffic to and from the landlocked countries, which account for about 20
percent and 40 percent of the port throughput for Mombasa and Dar es Salaam
respectively. Both ports have stated marketing objectives of capturing as much regional
traffic as possible, in order to increase volumes and shipping calls, and to lower units
costs through economies of scale. In the case of Dar es Salaam, the competition in respect
of a large proportion of the Zambia and DRC traffic extends to other regional ports such
as Durban in South Africa and Walvis Bay in Namibia, soon to be joined by improved
services and linkages to Beira in Mozambique and Lobito in Angola. The northern and
central corridor ports are thus considered to be truly competitive in respect of both
pricing and performance – this can be seen by the occasional shift in traffic flows from one
corridor to the other.

The efficiency of both ports could be enhanced through the introduction of competition
within each port for cargo, particularly for containerized cargo. Both Mombasa and Dar es
Salaam are finalizing engineering designs for new container terminals. These projects will
enter the construction phase soon, so that they will be available in three to four years to
further address the congestion problems in this high growth segment of the traffic. In the
case of Mombasa, it will be the first concessioning in the port and will compete with the
existing KPA operated terminal. At Dar es Salaam, the existing terminal operation is
concessioned. The decision was taken to open the new terminal to international tender so
as to have two operators in the port competing with each other.

Road, Rail and Lake

Except for the regulations governing GVM, dimensions, testing, maximum speeds, etc, -
and also the rules on the licensing of trucks for transit traffic only, and the prohibition of
cabotage – the trucking sector is largely self governing in respect of doing business and
setting prices. Some of the long term contract prices indicate that there may be an element
of collusion amongst some of the larger operators. Each truck operates as a unit and
therefore the operating costs fall within a fairly narrow band, mostly depending on the
 87

extent of return hauls. It is quite apparent that road has become far more competitive
than rail in respect of reliability and pricing for most commodities. In contrast to road,
railway cost vary widely, mainly dependent on volumes and asset utilization, because of
the different cost structure (much higher fixed cost for rail). Railway pricing has often
been set on the basis of what the market can bear, rather on the basis of actual cost,
resulting in loss-making and declining operations. The railways have been unable to
afford the cost of routine maintenance, necessary upgrading and new acquisitions. Road
and rail services on the northern and central corridors are therefore not truly competitive.
It has been argued that governments should assist in the provision track infrastructure,
similar to the provision of roads, in order the ‘level the competitive playing field’.
Substantial investments, linked to realistic revival plan, are required for rail to become
truly competitive with road. Rail still has clear advantages over road for certain freight
sectors – the export of soda ash from Magadi to Mombasa port, transported by dedicated
trains on contract (concession) basis, could not realistically be done by road.

Lake transport has declined for various reasons – accidents, operating permits and the
decline of the supporting rail services. However it remains a cheap, fast and reliable
service, compared to both road and rail, and is currently in the process of being revived,
particularly from Kenya and Uganda on Lake Victoria, and receiving renewed attention
from both governments and investors.

Infrastructure Financing through PPPs

A successful PPP strategy depends on an amalgam of general factors which influence a
country’s (or region’s) investment environment and specific policy, regulatory and
institutional measures which governments must implement to provide an enabling
environment for PPPs. Numerous authorities emphasize that clear policies, enabling
legislation, effective neutral regulation and strong institutions lie at the heart of good
governance in PPPs12.

Generally, a country’s policy, legal and regulatory framework can be regarded as

reflecting best practice if it meets the following criteria:

• A formal PPP policy is in place. An approved, documented policy is important

in signaling government’s commitment to develop a stable and attractive
investment environment. This enhances the interest of potential investors and
also influences their perception of risk positively. The policy also needs to
identify the infrastructure sectors, e.g. transport, where the government proposes
to implement a PPP program.

• Comprehensive enabling laws (or laws). Legislation is an important vehicle to

translate government’s policy commitments into practice. Generally, countries

12 A Guide to Promoting Good Governance in Public Private Partnerships, United Nations Economic Commission
for Europe, 2007
 88

should adopt a general PPP law or sector-specific laws in order to place its PPP
programme and investment regime on a sound legal footing.

• Clear project identification and preparation procedures. Good project

preparation is critical for successful PPPs. The law must require a project
proposal to be thoroughly screened to verify that it is affordable, represents value
for money and is financially- viable. A well prepared project will, in turn, once it
is bid, attract the interest of qualified investors with sufficient technical and
financial resources to implement a project successfully.

• Competitive bidding procedures. As a general rule, PPPs must be competitively

bid to ensure that government derives the full benefit from the competitive
process in terms of price, services and quality. Additionally, provision should be
made for equal treatment of potential investors, opportunity to challenge rules
and bid awards and specific rules on unsolicited proposals.

• Clear identification of contracting authorities. The law must specifically identify

the government entities which are empowered to enter into PPP arrangements.

• Freedom of contract. Legislation should not impose unnecessary restrictions on

the ability of the parties to negotiate contractual terms. This is important to allow
flexibility in the allocation of risks to ensure a financially efficient approach and
secure the best possible value for money for government.

• Performance monitoring framework. Legislation must establish a clear

management and monitoring framework. As many PPPs have a lifespan of
several years or even decades, it is important that government allocate clear
responsibility for monitoring implementation and contract compliance. At the
same time, the private investor should be fully aware of the oversight procedures
that will apply and of the frequency and nature of its performance monitoring
obligations.

• Statutory authority for tariff collection (and/or payments by government). The

ability to collect user charges or tolls from customers of the PPP facility is critical
to the investor’s perception of the financial risks associated with a project (where
applicable). The law must, therefore, expressly permit the private investor to
collect tolls or user charges (or alternatively, make clear provision for the investor
to be reimbursed through payments by government).

• Clear rules on tariff regulation. PPP arrangements can be long term in nature (20
– 30 years). Over this period there will be a need for regular adjustment in the
tolls or charges levied by the private party for the service. While procedures for
tariff adjustment can be regulated by contract, the law must provide clear
guideline on how tariffs may be adjusted and what criteria will be applied.

• Comprehensive regulatory framework for safety and environmental

regulation. As PPP arrangements entail the provision of a public service, it is
necessary that the public interest be protected through effective safety and
 89

environmental regulation. The private investor must be fully aware of which

safety and environmental standards apply and how they will be enforced.

• Effective protection of investor’s rights. The law must protect the investor
against arbitrary government action that may impact revenue flows, restrict
access to finance or otherwise or deprive him of the benefit if his investment. This
includes a requirement that the parties should be free to agree on appropriate
methods of dispute resolution. A country’s membership to MIGA helps to
provide such guarantee.

• Institutional capacity. The identification, preparation, procurement and

management of PPPs require a combination of high-level legal, financial and
technical skills. The ability of government to manage its PPP program is an
important factor influencing investors both in their decisions to invest and in
their perception of the project risks. Countries that have established dedicated
PPP units in order to build capacity have generally been more successful in
attracting private investment and launching viable PPPs.

• Independent regulation. The law must provide for regulators that are
sufficiently autonomous to ensure that regulatory decisions are not influenced by
political interference or pressure from interest groups.

Adopting rules on PPP project identification, preparation and procurement is now

generally accepted as best practice within developing countries that desire to attract more
investment through PPPs. Only Kenya has adopted such rules to date, while Tanzania has
adopted a new Act which still requires refinements to meet best practice.13

PPP project implementation capacity is limited in all states and the lack of capacity is
reportedly one of the factors that has created difficulties with PPP implementation, e.g. in
the railway sector. A PPP unit has been established in Kenya and legislation now provides
for similar institution(s) in Tanzania. As yet, there are no PPP units in Burundi, Rwanda
or Uganda.

Given the difficulty in building national PPP capacity, the option of establishing a
regional PPP unit should be considered to provide services for national projects and
support for future regional PPPs. The advantage of a regional unit would be to pool
scarce expertise and thereby develop stronger PPP capacity than national governments
may be able to build individually. A regional unit could develop into a centre of
excellence and provide advisory services as and when needed for individual national
projects. At the same time, it could act as support unit for regional projects which may in
future be undertaken as PPPs. Technical assistance would be required to:

• Study institutional options and define the status of the unit within the overall
structure of the EAC;

13 A private member’s bill has been tabled proposing the adoption of an EAC Public Private Partnership
Act. However, the legislation has been delayed as some provisions are viewed as being inappropriate to
the needs of individual states.
 90

• Define the role, functions and duties of the regional unit vis-à-vis national units
and contracting authorities;

• Recommend an organizational structure and staffing;

• Propose funding options; and

• Recommend and draft an appropriate legal instrument to establish the unit.

Recent funding raising efforts for African infrastructure found that the single most
challenging part of the process as described was not the investment merit of the continent,
but rather demonstrating where the money would be spent, i.e. a question of deal flow.
Another related constraint was the challenge to effect PPP projects, from idea to full
closure, in the short political window of 4 years before the political space and momentum
changes. Other challenges included: the lack of a balanced and clear risk allocation
matrix; the lengthy process of risk identification, quantification and allocation due to the
complexity of projects; weak capacity of the public sector partners; lack of competitive
and transparent bidding processes; the need to complement transitional (sponsor) equity
with upfront capital support and subsequently with lower cost debt and equity
refinancing for PPP projects, particularly after the construction period.

While the above elements ideally should be in place to foster a vibrant and growing role
for the private sector to invest in what has traditionally been considered public
infrastructure. However, even though there are efforts to establish this PPP framework,
the region cannot wait for the complete framework to be developed, adopted and
implemented before attracting private sector funding for critical infrastructure needs. In
the absence of a comprehensive PPP framework, international and regional experience
has shown that specific projects can be implemented under legal contractual
arrangements and can mobilize sizable levels of private sector investment. Within the
region, examples of Citadel in RVR, TICTS in Dar es Salaam Port and KLM in Kenya
Airways are important models to consider.

In assessing the PPP potential of the propose projects, international and regional
experience of the types of projects that have proven to be most amenable to attract private
sector financing was taken into consideration. For example, many of the proposed port
projects can generate sufficient cash and foreign exchange to meet debt service
requirements. The railway investments if combined with a sensible business plan and
strong management can attract private investment. Road projects with significant traffic
may be the most suitable to attract private investment as toll roads or under a shadow toll
arrangement in which the governments contribute revenues based on traffic volumes.

Leadership by NCTTCA and CCTTFA

Many of the infrastructure and facilitation improvements should be done on a corridor
basis. Improvement is a dynamic process driven by dialogue between public and private
sectors. NCTTFA and CCTTCA are best equipped to lead and monitor the process at the
corridor level. The role of both entities is to insure effective operation of transport,
logistics and trade on the corridor in the interest of all member countries. With this
mandate, they are ideally suited to promote the infrastructure, facilitation and legal and
 91

regulatory framework to strengthen corridor infrastructure and operations. These two

organizations have specialists on staff for infrastructure, facilitation and trade and some
resources provided by members. Nevertheless, they need assistance to develop a
sustainable plan for advocacy and fostering stakeholder actions for improvements.

The NCTTCA is well established, but needs a way to more fully engage their public sector
members in the improvement process and to more fully incorporate the private sector in
identifying problems and solutions. As it implements, it needs access to some additional
technical assistance and field work on a demand basis. NCTTCA needs to create a
stronger mechanism for delivering this commitment of both public and private sectors.
Once initiated, progress toward agreed outputs would be assessed and redirected every
six months. NCTTCA has tended to rely on donor support and outside consultants. They
should seek to encourage active involvement from their members to make the activities
sustainable and to reduce the dependence on outside consultants.

CCTTFA is currently finalizing staff appointments and developing its work plan. Its
Board, which has equal public – private membership, would lead the process for CCTTFA
and create the link between Corridor group and national government action. CCTTFA
needs to set up their operational structure and mode of operation. It will depend on
member buy-in to be successful.
 93

6. Proposed Northern Corridor

Projects
In this section we present an overview of specific infrastructure projects that have been
identified to improve the performance of the Northern Corridor in the next five years.
Projects were selected for the Action Plan based upon the strategies for improving the
Northern Corridor performance described in Chapter 5 and their potential to have a
significant impact on the corridor’s performance in terms of time, cost and reliability. All
of the proposed projects are also deemed to have a medium to high economic viability.

The projects are presented by transport mode in the sections below. Detailed project
profiles of these proposed infrastructure interventions are presented in Appendix A. The
profiles include the background and rationale for the project, agencies involved, a
description of major components, critical factors for success, related projects and expected
benefits/impacts. Cost by major component is provided along with the investment start
date, duration and PPP potential.

Mombasa Port
Four infrastructure projects are proposed for Mombasa Port with a total cost of US$ 435
million (Table 6-1). There is also one project for Lamu Port with a cost of US$ 7 million.
Together these projects are expected to reduce price by 15 percent, time of port operations
by 42 percent and improve the reliability of port services by 69 percent.

Table 6-1
Proposed Infrastructure Projects for Mombasa Port
Cost Estimated Impact on Port
EIRR
(US$ Performance
(%)
Name million) Price Time Reliability
Mombasa Short-term Container Handling Capacity 35 -4 - 13 - 23 165
Enhancement (ICDs)
Mombasa New Container Terminal Kipevu West 342 -3 - 11 - 23 37
Mombasa New Petroleum Facility 56 -5 - 12 - 13 35
Mombasa Dry Bulk and General Cargo Facilities 2 -3 -6 - 10 25
Lamu Corridor New Port and Associated 7 n.a n.a. n.a. 30
Infrastructure .
Total 442 - 15 - 42 - 69
Source: Prepared by Nathan Associates Inc.
 94

The location of the Mombasa Port projects is shown on Figure 6-1 and a general
description of each project is presented below.

Figure 6-1
Port of Mombasa Long term Port Master Plan Proposals

Source: M.A. Consulting Group, Review and Update of Port Master Plan including Development of Free Trade
Zone for KPA.

Mombasa Short-term Container Handling Capacity Enhancement with ICDs

The Mombasa container handling terminal (Berths 16 – 18) is operating at full capacity:
berth occupancy in 2009 was at around 90 percent as opposed to ideal 70 percent or
below. Even with the supplemental container handling capacity at conventional terminal
(Berths 11 – 14) the estimated combined port container handling capacity of 600,000 TEU
is below the 2009 throughput of around 620,000 TEU. Planned new capacity, in particular
new Kipevu terminal, is expected to be available 2014 or 2015, more likely the latter date.
Given the continued growth of container traffic, recorded at an average 9 percent during
2005 – 2009 and over 13 percent in 2010, this means that without any other intervention to
create additional capacity in the short-term, there will be severe congestion with
disastrous results for the port and trade in three to five years until new terminals or
additional capacity is available.

During the last crisis of severe congestion, the off dock ICDs, known in Mombasa/Kenya
as CFSs, were engaged in 2007 and have helped decongest the port. In this regard, some
of domestic containers are transferred to CFSs and in the process removing some of the
activities from the port container yards to create more operating space. The proposal is to
build on this experience by formally integrating CFSs into the port system to create much
needed additional space, higher productivity and, thus, additional capacity to handle
ships and containers.

The proposed off-dock ICDs/CFSs Integration Program comprises:

 95

• Relocating all container processing activities from marine yard to CFSs, thus
moving entire ships to CFSs, contracted by shipping lines competitively (based
on quality of service and price). Possible exception could be ready to go rail
bound boxes;

• Simplifying of transfers between marine yard and CFS, including automation of

marine gate and use of high capacity and specially tagged trucks to provide
shuttle services; and

• CFSs enhancing facilities and technical competency to handle increased transfers

from marine yard and to service clients,

Securing acceptance of the proposal by key players and decision makers especially
Government, KPA and KRA. The proposal has been discussed by stakeholders at a
roundtable meeting and adjudged beneficial. It is estimated that implementation of the
CFS integration program may result in increase of capacity up to 1.35 million TEU that
would be adequate for at least another five to eight years. This would avoid the cost
associated with long waiting times of ships, low productivity of expensive berth facilities
and equipment as well as surcharges by shipping lines. These benefits far outweigh the
additional costs and extra time for transfers to CFSs.

MOMBASA NEW CONTAINER TERMINAL – KIPEVU WEST

As mentioned above, the negative impact on vessel wait time, ship turnaround time at
the port, and quay and yard operations require urgent action. Over one quarter of
throughput is transit cargo, with 80 percent to Uganda. Construction of a new container
terminal is critical to Kenya’s economic growth and that of the landlocked countries that
Mombasa serves. This will be KPA’s first concession for terminal operations. In addition
to this project, KPA is extending the existing terminal to Berth 19 (tenders submitted 30
September 2010) and plans to upgrade and convert Berths 11-14 to an additional container
facility with a private operator. Therefore this project is within a broader strategy to meet
the demand for container handling in the region.

The technical designs for the container terminal are being finished. A loan agreement has
been signed with JICA for US$ 239 million to finance the terminal and related equipment
and access road. Tenders for the dredging were submitted in February 2010.
Consideration of legal requirements for a concession are underway.

The site is 100 hectares near the Kipevu Oil Terminal. The construction will be in three
phases. The first phase is intended to commence in 2011 and be completed in 2013-2014
and will include the following components:

• The terminal is designed to handle 450,000 TEU in the first year (2013) and, when
completed, 1.2 million TEU. The JICA loan will cover construction, ship to shore
gantry cranes, rubber tired cranes, an access road and construction and extension
of yards,.

• A concessionaire will be recruited to provide handling equipment and operate.

JICA will also assist with concessioning plan and selection.
 96

• A related dredging program for the entrance channel (15 m), widening the
turning basin and berth (11-15 m) will allow vessels carrying up to 4,600 TEU.

• Extension of rail access to the terminal and buoy and channel markers in the
access channel.

• A consultant to advise on the final terms for the concession based on experience
with similar terminal concessions worldwide.

The second Kipevu terminal will double container capacity by 2018 to meet the needs
projected for the medium-longer term. High performance standards due to appropriate
terminal design, experienced operator, optimal handling equipment and state of the art
information systems to generate the needed coordination and speed to achieve
internationally competitive performance standards at Mombasa.

ENHANCING PORT OPERATION WITH ICT APPLICATIONS (TA)

A community-based/single window system is essential to decrease clearance times
needed to handle the level of traffic anticipated for Mombasa. Currently, individual
procedures in the port can take two to three days. And if performed consecutively, can
take a total of twelve to twenty days. Other delay factors include submitted documents
being incomplete, one agency taking paperwork out of the chain so it doesn’t get
processed, clearing agents/shippers being slow to pay fees and duties, shippers
intentionally using the port/ICD for storage, not tracking location of containers, or
stacking over five containers because of lack of space.

A community based system is designed to address this. The computer tracks procedures
and payments as they are initiated and completed. This allows the stakeholders to know
where the container is in the process toward release, thereby enabling interventions to
complete the process. It allows coordination of port procedures through sending alerts
that an action is needed and overall monitoring to identify problems to be addressed. A
single window system allows one agency to act on behalf of all parties in entering and
tracking of containers procedures. It includes all the risk parameters and requirements for
most commodities so that the clearance can be completely automated and no human
intervention is needed. This leads to greater efficiency and transparency.

Developing the system requires a great deal of data entry and in its most sophisticated
form- artificial intelligence software. The computer is able to route any trade transactions
to the appropriate agency modules that review completeness, determine fees, and trigger
approval or the need to human intervention.

Kenya has financing from the World Bank to develop a single window centralized in the
Kenyan Cabinet through the Ministry of Finance. Thus it is not housed in any of the
border control agencies. This position enables it to coordinate all government ministries’
participation. Kenya’s plan is to develop and implement the system at the port of
Mombasa, Kenyatta International Airport and land borders. Kenya has just recruited
additional specialists to the team designing the system.
 97

This system has the potential to reduce dwell time to three to four days overall. It will
enable the coordination of functions necessary to the most efficient processing of persons
and goods. The single window system facilitates optimum coordination among agencies
at the port. As it tracks and monitors the process electronically, it has the capacity to
reduce corruption as well since they remove much of the decision making from humans
to computer systems.

MOMBASA NEW PETROLEUM FACILITY

Kipevu Oil Terminal handles crude oil and refined oil products and can accommodate
vessels to 85 thousand DWT and up to 198 meters long. In 2008, it was at 78 percent berth
occupancy and in 2009 was at 86.5 percent. Vessel delays to berth currently cost the
petroleum industry an average of US$100 million annually. The port needs new
petroleum capacity urgently. The Shimanzi Oil Terminal, which can accommodate vessels
up to 35,000 DWT and 259 meters long, handles chemical and other liquid products. This
terminal was operating at 62.5 percent capacity in 2008 and 75 percent in 2009. KPA
considers it “tending toward saturation”. Therefore the Port of Mombasa has a major
problem with liquid bulk products. This affects not only Kenya, but also Uganda, Rwanda
and other countries importing petroleum and other liquid bulk through the Port of
Mombasa.

An international tender was issued by the National Oil Corporation of Kenya in late 2010
for a technical feasibility study of the construction of an offshore petroleum offloading
jetty at Mombasa. EOIs were due December 3, 2010. It can be assumed that a full contract
will be issued during 2011.

The project is designed to meet the need for additional liquid bulk capacity through
design of a BOT project for a single buoy point or off shore jetty system. The project is
valued at US$55 million and will involve the Government of Kenya and the private sector.
It will be further defined by the feasibility study.

It will be critical to develop a BOT framework that meets the Kenyan and regional need
for petroleum and sufficiently rewards the private sector for participation. Appropriate
connections to the Kenyan pipeline are essential to success. Review of the pipeline
capacity is also being undertaken. Decisions on the pipeline and estimates of total regional
demand will be affected by the development of the petroleum fields in Uganda. The first
area is underway and a feasibility study is being conducted for a Ugandan refinery.

MOMBASA DRY BULK FACILITIES DEVELOPMENT

Dry bulk of grains, coal, clinker, fertilizers and others is handled at Berths 1-10 and
Mbaraki Wharf. Wheat is handled at Berth 3 at which conveyor belts are connected from
the Grain Bulk Handlers Ltd. (GBHL) silos. In 2007, 1.5 million tonnes of fertilizer, clinker
and coal in total moved through Mombasa Port in 2007. The total is estimated to increase
to 2.38 million by 2013. A power station is being constructed at Dongo Kundu and will
need to import 1 million tons of coal per annum. This could be handled by a dedicated
jetty or a common user bulk facility. It is possible to develop a new dry bulk facility in
conjunction with this facility for cost sharing.
 98

KPA rates Mbaraki Wharf as tending to saturation and needing attention. Furthermore,
the analysis in the Master Plan indicates that construction of a new berth is necessary,
possibly at Dongo Kundu. The proposed improvement of bulk terminal infrastructure
includes:

• Building two new bridges that can accommodate articulated trucks entering the
wharf;

• Extending the berth by 220 m and deepening to -12.5 to allow larger ships to
dock, thereby reducing cost and making the wharf more efficient;

• Extending the berth 220 m, based on projections of demand: Depending on the

availability at Berths 1-10, it may be possible to delay this until a new berth can
be built at Dongo Kundu.

The master plan suggests that with these developments Berth 1 should continue to be
used for RoRo vessels and cruise ships at present; Berth 3 for grain and the conveyor
extended to Berth 4; Berth 5 for RoRo vessels and general cargo such as steel - it could also
be converted to an additional grain terminal; Berths 7, 8 and10 for general cargo, bulk
liquids and any dirty bulks’ and Berth 9 for soda ash. The main changes are some
repaving and taking down some sheds to allow more storage areas.

Implementing the proposed investments will result in more efficient handling of bulk
traffic, with cost savings estimated at US$ 0.11 per ton. GBHL also estimates, for example,
that the cost of fertilizer could be reduced 25 percent with a good bulk handling system
for fertilizer at the port.

LAMU PORT AND CORRIDOR

The original motivation for the development of a new port at Lamu in the 1970’s, was the
problem of congestion at Mombasa port, which serves as Kenya’s only port for
international trade, and which was considered to be approaching its maximum
development capacity. Since then, the freight throughput at Mombasa has expanded more
than threefold from 6 mtpa to more than 19 mtpa, and further expansion is being
pursued.

During 2005/6, the Kenyan government, in discussions with southern Sudan and Ethiopia
developed the ROOLA project, which included the following infrastructure components:

• Oil pipeline from Southern Sudan to Lamu

• A high speed standard gauge railway linking Lamu to Juba, with links to Addis
Ababa and to Gulu in Uganda

• A super highway network linking Lamu to southern Sudan, Ethiopia, and the
existing road network in Kenya and Uganda

• A fiber-optic cable along the main transport routes

• The development of an oil refinery and free port at Lamu.

The ROOLA project has effectively been replaced by the LAPSET project (Lamu Port,
Southern Sudan, Ethiopia Transport Corridor), aimed at developing a master plan for the
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port development, with the study to be completed during 2011. The intention is to fund
the project through a PPP process.

Such a grand regional infrastructure project will require one or several major anchor
projects in order to motivate the initial financing of the core infrastructure. This is likely to
be one or several of the following:

• Oil exports from Southern Sudan, could be of the order of 500,000 bbl/day or +20
mtpa

• Oil exports from Uganda, could be up to 150,000 bbl/day or 7 mtpa

• Future iron ore exports form Mt Kodo in the DRC, up to 50 mtpa in order to
justify the cost of a dedicated heavy haul line over 1,600 km

The development of a new container terminal at Lamu, to serve southern Sudan, Ethiopia,
and increased demand from the northern corridor, supplementing Mombasa port – this is
viewed as a longer term project, given the current expansion projects at Mombasa

Manda Bay, located close to Lamu town, is considered ideal for the development of a
deep sea port, with marine access depth of more than 18 m. However, the Lamu area has
been declared as a world heritage site, and there will be environmental constraints on
future development, particularly potentially polluting activities such as oil and bulk
minerals exports.

In order to advance development of the project, during 2010, Japan Port Consultants were
appointed to carry out a feasibility study, funded by the Kenyan Government, to be
completed during 2011.

The initial focus now is on the completion of the feasibility study, including projections of
future regional trade and freight flows. Depending on the results of the study, a detailed
Environmental Impact Assessment will follow.

There are some potential long term economic benefits of a new port development at
Lamu. These include (1) supporting the development of bulk terminals for oil and
minerals, which would be difficult to locate at Mombasa; (2) opening up new areas for
economic development in the countries concerned; and (3) providing an alternative port
serving east Africa to increase competition with a view to improving performance and
lower prices.

Lake Ports and Transport

The description of lake transport projects that serve both the Northern and Central
corridors is presented in the following chapter on the Central Corridor.

Rail
Six rail infrastructure projects are proposed for the Northern Corridor rail system with a
total cost of US$ 775 million (Table 6-2). Together these projects are expected to reduce
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price for transport on the RVR network by 10 percent, time of rail operations by 26
percent and improve the reliability of rail services by 36 percent.

Table 6-2
Proposed Northern Corridor Rail Projects
Cost Estimated Impact on Rail
Performance (%) EIRR
(US$ (%)
Name million) Price Time Reliability
RVR Infrastructure Upgrade Years 1-3 250 -2 -6 -9 22
RVR Infrastructure Upgrade Years 3-5 150 -2 -5 -6 22
RVR Locomotive Rehabilitation - 3 Years 20 -4 -11 -15 22
Reconstruction Tororo – Gulu – Pakwach 325 n.a. n.a. n.a. 24
Railway
RVR Mombasa Intermodal Yard & Equipment 20 -1 -2 -3 26
RVR Kampala ICD Development 10 -1 -2 -3 21
Total 775 -10 -26 -36
Source: Prepared by Nathan Associates Inc.

A description of each of these proposed rail projects for the Northern Corridor is
presented below.

RVR INFRASTRUCTURE UPGRADE: 1–3 YEARS

The Kenyan and Ugandan railway systems are operated jointly by one concessionaire, Rift
Valley Railways (RVR), under two separate concession agreements. The RVR concession
followed a similar sequential process to several other railway concessions in eastern and
southern Africa:

• decline of the railway services,

• loss of traffic volumes and revenue,
• unsustainable loss-making operations, lack of investment,
• absence of infrastructure and equipment maintenance,
• decision to privatize operations
• lengthy and delayed process of concessioning / privatization, leading to further
deterioration of assets and market
• flawed bidding process – selection of concessionaire
• operations in atmosphere of conflict, delay of investment schedule
• non performance of the concession

In the case of RVR, the original commercial shareholder and operator was unable to
revive the operations of the railway services in the Northern Corridor, which continued to
experience unacceptably high levels of equipment failure and major derailments – traffic
volumes remained at low levels. During 2010, a new resourceful commercial shareholder
gained control of RVR, with an initial commitment to invest US$ 290 million in the first
phase of revival, with plan to increase traffic levels three-fold from the current
approximately 1.5 mtpa to 4.5 mtpa.

RVR operates on a meter gauge line with coverage of about 2,735 km in Kenya and
approximately 306 km in Uganda. The revised concession also includes the 501 km
northern line from Tororo to Pakwack, which remains non-operational. The poor
condition of the track has lead to imposition of temporary speed restrictions on many
 101

sections across the track, resulting in about twenty major derailments per month and
unpredictable transit times.

The agreements relating to the new commercial shareholder in RVR are in place, and the
track repair and upgrading program has commenced in both Uganda and Kenya.

The project consists of initial repair and upgrading of specific sections of poor track in
both Uganda and Kenya, which are the main causes of frequent derailments and
restricted operating conditions. The first phase of civil engineering works, carried out
during years 1 to 3, is focused on the following:

• Addressing inherited maintenance deficit.

• Programmed ongoing track maintenance activities.
• Planned rehabilitation works for particular sections which require more attention
than simple maintenance program.

The critical issue in the track rehabilitation program is a 30 km section between Mombasa
and Nairobi where rails are worn beyond permissible wear, with damaged sleepers and
missing / damaged fittings and fasteners including ballast deficiency. The estimated cost
of repairs is KES 475 million (US$ 6 million, or US$ 200/km). Similarly, there is a critical
section of poor track drainage in the Jinja region in Uganda, with severe speed restrictions
and limited train lengths of ten wagons – work on this section has commenced.

The key success factor is that the financing is secured and that the initial rehabilitation
program is not delayed. The track rehabilitation program has been commenced within the
initial capital budget of US$ 290 million, which includes the provision of funds for the
rehabilitation of selected locomotives and wagons. RVR will require additional financing
for track repairs and upgrades through the governments of Kenya and Uganda, as owners
of the infrastructure.

RVR INFRASTRUCTURE UPGRADE: 3–5 YEARS

Following the initial 3 year program for track rehabilitation and upgrades in Kenya and
Uganda, focused on improving reliability, lowering operational costs and increasing
traffic level and income, the next phase of infrastructure upgrades will be necessary in
order to increase capacity.

Freight traffic volumes are projected to increase from the current 1.5 mtpa to 4.5mtpa in
the short to medium term, which will be possible by the repair, upgrading and
maintenance of the existing infrastructure and equipment. Kenya and Uganda railways
have previously carried freight volumes of this order, and the 1 to 3 years and the 3 to 5
year revival programs, linked with the development of inland container deports and
terminals, should firstly restore reliability of services and market confidence, and
secondly increase the carrying capacity of the rail system. The development of new major
resource based projects within the northern corridor, such as the Ugandan oil sector,
expected to commence production in 2011/12, will generate significant additional
demand for railway services for both inputs and outputs. It is possible that the export of
crude oil through a new marine terminal at Mombasa or at Lamu, will carried by rail
rather than pipeline, with a demand of up to 150,000 bbl/day or 7 million tpa. This will
 102

require a further increase of capacity through the provision for longer trains and passing
loops, and realignment of some sections. This could also initiate to gradual upgrading of
the mainline to a heavier rail section, and strengthening of selected structures, to allow for
increased axle loads. If and when the Mount Kodo iron ore deposit in eastern DRC is
developed, which could only be viable if very large volumes are transported, up to 50
mtpa, in order to achieve low unit costs and tariffs, it is likely that a new dedicated rail
system will be developed for this project.

The RVR railway concession in Kenya and Uganda has been restructured with a new
commercial shareholder and the process of revival of the operations to restore the
previous capacity of the rail systems has commenced. The first 1 to 3 year phase is focused
on improving reliability and increasing traffic volumes, and if successful, will be followed
by a program to increase capacity. RVR has stated that it is in discussions with Tullow Oil
for servicing the Uganda oil sector development, which could provide the basis a
significant upgrade and expansion of the railway network, initially based on inputs, and
later also on outputs. The RVR railway concession in Uganda has been expanded to
include the possible reopening of the northern rail link to Gulu and Pakwach, to serve the
oil sector around Lake Albert.

The second phase of track rehabilitation, focused on increasing capacity, will involve a
degree of upgrading of the track to improve operating speeds and allow for more
frequent and longer trains. Improved signaling will also be necessary. The engineering
works will include the replacement of worn rails, likely in conjunction with upgrading to
allow for heavier axle loads, realignment of sections in difficult topography, and the
provision of longer and more frequent passing loops. The program and specifications will
largely be determined by demand, particularly if large anchor customers such as the
Ugandan oil sector freight volumes come to fruition.

RECONSTRUCTION OF THE TORORO – GULU – PAKWACH RAILWAY

The northern railway from Tororo in Uganda, through Gulu to Pakwach, was completed
in 1964, a total distance of about 500 km. Due to several periods of conflict in northern
Uganda, and the decline of traffic levels, the line was closed, and all freight traffic
diverted to road. The security situation in northern Uganda has improved, and this route
now provides the main conduit for international trade with southern Sudan (more than
200,000 tpa through Mombasa in Kenya). In addition, the development of the Uganda oil
sector in the region served by the northern railway will require significant imports of
equipment and materials, and the possibility of crude oil exports of up to an estimated 7
mtpa by rail. There is also the possibility of future iron ore exports from eastern DRC at
Mt Kodo, about 100 km west of Pakwach and a distance of about 1,600 km from either
Mombasa or a future terminal at Lamu. Future iron ore exports from DRC will have to be
based on very large volumes in the region of 30 mtpa to 50 mtpa, in order to very low unit
transport costs, and this would require a new heavy haul railway to the port, most likely
to standard gauge specifications (considered to be a long term project).

The feasibility study for reopening the railway to Gulu and Pakwach has been completed
and the RVR railway concession agreement has been expanded to include the northern
 103

line. Proposals have also been considered by the Ugandan and south Sudanese
governments for upgrading the line from Tororo to Gulu to standard gauge (400 km) and
extending the railway from Gulu to Juba in southern Sudan (250 km), to serve as an
alternative route to the previously proposed Juba to Lamu standard gauge railway. This is
likely to be a long term project, but the reopening of the existing line is considered to be a
short term priority.

The project will upgrade approximately 500 km of the existing northern railway from the
current 25 kg/m rail to +40 kg/m track, 20-ton axle loads, with possible realignment in
sections in order to increase operating speeds. This will include strengthening of bridges
and culverts, lengthening of passing loops, and provision for later upgrading to a
standard gauge specification (three-rail system). RVR is the designated operator.
Estimated cost in the region of US$400, depending on the recommendation of the
feasibility study. This could be implemented as a phased PPP project.

RVR LOCOMOTIVE REHABILITATION: 1–3 YEARS

RVR inherited thirty-nine mainline (Class 93/94) diesel electric locomotives from KRC,
which form the core of the mainline fleet. These locomotives are North American GE
U26Cs, fitted with 2,600 hp engines. A total of twenty-six were built in 1977 and the
remainder in 1987 or later. The bulk of the mainline fleet is therefore 37 years old, but
continue to remain serviceable and suitable for rehabilitation and upgrading. In southern
Africa, many of the mainline locomotives still in service are more than fifty years old, and
continue to be serviceable.

RVR operations have been handicapped by the poor condition of locomotives. Out of the
thirty-nine mainline locomotives inherited from KRC, only twenty-five are currently in
service with varying degrees of suspect reliability due to a back log of deferred
maintenance. This has led to a high rate of locomotive/train failures in transit. Between
January 2009 and August 2009, RVR experienced a total of 579 mainline locomotive
failures – more than two per day, mostly due to engine failures.

Figure 6-2
RVR Locomotive and Train Set
Daily train targets have been six per
day on the Mombasa – Nairobi
section, now being revised with a
target of nine trains per day, with four
trains planned to transport containers.
In order to meet this target RVR
locomotives have been supplemented
by locomotives hired from Magadi
Soda Company, which operates their
own train of the RVR lines between
Magadi and Mombasa.
 104

On the RVR Uganda section between Malaba and Kampala, the mainline locomotives are
much smaller, similar to those used on the TRL system in Tanzania, 1,200 hp. During the
1980’s the Nalukolongo railway workshop near Kampala were equipped and ungraded
through a €40 million program by KfW, and it is well qualified to carry out full
refurbishment of the Uganda locomotives, subject to financing being available. The longer
term objective is to replace the Uganda locomotives with larger units similar to those
operated in Kenya, to allow for seamless railway operations.

The locomotive repair program (availability of finance) has been commenced by RVR is
both Uganda and Kenya, with the initial objective of rectifying deferred maintenance and
recommencing the standard maintenance programs. Repair and upgrading of the existing
RVR locomotive fleet in both Kenya and Uganda is essential to achieve availability of
more than 90 percent. A major mainline locomotive overhaul is likely to cost more the
US$ 0.5 million per unit. A similar program is being implemented for the wagon fleet.

RVR KAMPALA ICD DEVELOPMENT

The efficiency of the modal transfer points, normally located at the inland rail container
depot or terminal (ICD), is critical to the competitiveness of rail. Prior to containerization
in the 1970’s, and the deregulation of road transport, it was common practice for the
railway operators to deliver wagons to the customers sidings for loading and unloading.
This is no longer considered operationally viable, because of the resulting low equipment
utilization, unless it is a large customer with fixed consignments or dedicated wagons,
and who is willing to pay extra for the wagon re-positioning service (for example
Mukwano in Kampala for their edible oil imports). The alternative is for the railway
operator to have a highly efficient and well equipped container terminal, including
customs services, where containers can be transferred between road and rail quickly and
at a low cost. It is important for the railway operator to turn the unit train around as
quickly as possible. The expansion and upgrading of the Kampala rail ICD is therefore an
important part of RVR’s marketing strategy. Previously, about eight years ago, it was also
proposed to develop an ICD at Port Bell, and the viability of this will depend on how the
Lake Victoria container services are operated in future.

The expansion, upgrading and successful operation of the Kampala ICD (rail freight
terminal) will directly promote rail services, and should assist in shifting both transit
traffic and regional trade from road to rail. The existing yard is to be expanded and
upgraded, with new equipment and longer rail sidings. Rail access should be directly
from the main line and road access should be directly to the key ring roads and bypasses.
Ideally train loading and unloading should be by RMG’s, and yard equipment should be
reach stackers and/or rubber tired gantries. There should be sufficient space for future
major expansion – this is often a short coming of ICDs.

RVR MOMBASA INTERMODAL YARD AND EQUIPMENT

It is well known that the modal interface between port and the land services of road and
rail, is where most time is lost, and significant additional logistics costs are incurred. This
is mainly due to issues of documentation and customs clearance, but also because of poor
 105

interfaces with both road and rail. The rail facilities at many of the regional container
terminals are poor, and the operating procedures have been partially inherited from the
pre-containerization period - access via inefficiently operated marshalling yards, where
trains are stopped, checked and often broken up or retained. Ideally, the intermodal trains
should enter the port directly as a unit, with a detailed manifest of all the containers
carried. The rail sidings at the Mombasa container terminal are 450 m long, capable of
handling trains of up to thirty wagons, with loading and unloading by RMGs (rail
mounted gantries).

As the mainline track is upgraded, and the use of vacuum brakes is standardized, with
increased traffic volumes, trains of up to 50 wagons should be planned. Conversion to
standard gauge will allow much longer trains, but not yet justified by the traffic volumes.
The Mombasa container terminal is far too narrow – about 200 m instead of the
recommended 500 m – resulting in terminal congestion and interference between the road
and rail services.

With the planned expansion of the existing container terminal with Berth 19, it appears
that the existing rail sidings can be lengthened to accommodate longer trains. It is
important in any new development or conversion of conventional berths, that utmost
attention is given to the positioning and length of sidings, and the equipment specified.
Clearly the layout, positioning and equipment selection for the intermodal rail sidings at
the planned new terminal at Kipevu West must be determined in close liaison with RVR
and KR.

The proposed investment includes the lengthening of the rail sidings at the existing
container terminals in conjunction with the extension of Berth 19, the provision of
additional RMGs, and additional terminal equipment – reach stackers, rubber tired
gantries and port tractor - trailer units. If the intermodal rail service is operated as a block
or unit train, with fast loading and unloading times, there should be very little
requirement for wagon shunting.

ESTABLISH REGIONAL RAILWAY SAFETY REGULATOR (TA)

The RVR in Kenya and Uganda and TRL in Tanzania share a common track gauge of
1,000 mm and similar technical specification in respect of wagon coupling systems. The
respective railway safety regulators enforce the provisions of the railway acts in each
country in respect of track and equipment condition, operating procedures, including
speed restrictions. Speed restrictions and limitations on train lengths are intended to
ensure safe operation conditions (prevent derailments). In practice, with each country
having its own safety regulator, when trains are moved from one system or country to
another, locomotive and train crews are switched. This solves the problem of
accountability in the event of an accident. At the interchange point, the wagons are
inspected and those with faults or safety issues are held back. This process is time
consuming and disruptive – very often consolidated loads are broken up because of
wagon faults, or trains are delayed because of the unavailability of locomotives at the
interchange point. A safety regulator which covers all three countries – Kenya, Uganda
and Tanzania (and in future Rwanda and Burundi) would allow the operation of seamless
 106

train services between the different systems and countries, with joint wagon safety
inspections carried out at the points of departure, rather than the interchange points.

Figure 6-3
RVR Derailment
Safety regulation of railway operations fall
under the respective ministries of transport
in Kenya and Uganda, and under a
specialized unit in Tanzania, SUMATRA
(Surface and Maritime Transport Authority),
which is also responsible for transport
economic regulation. There has been no
attempt or initiative to set up a regional
railway safety regulator, mainly because of
the general decline in railway services in
both corridors and the problems experienced
with both the TRL and RVR railway
concessions. However, the RVR revival process is now underway, with the TRL revival
being planned, and improved interoperability will be a key success factor.

A study is recommended to investigate and propose a structure for the establishment and
operation of a regional railway safety regulator and the linkages to the various national
transport safety regulators. This will be confined to the Northern and Central Corridors
only, rather than the EA region, because of the limited geographical coverage of the 1,000
mm gauge system.

Roads
As described in Chapter 2, an assessment of Northern Corridor road network was carried
out by Aurecon for the East African Transport Strategy and Regional Road Sector
Development Program conducted for the EAC in 2010. This assessment resulted in the
identification of three categories of road improvements:

• Upgrade Road Capacity - Immediate remedial action, in terms of proving

additional capacity principally by adding lanes (e.g. climbing lanes or extra
lane(s) for the whole identified length) is recommended for roads with level of
service E and F. Roads with LOS D and C are to be investigated for remedial
action later.

• Rehabilitation of Paved Roads - is triggered for a paved road once its overall
condition has deteriorated beyond the point where preventive and routine
maintenance can uphold the pavement at a functional level.

• Upgrade to Paved Standards - Gravel roads with traffic volumes in excess of 200
vehicles per day operate under poor riding quality conditions and generate
excessive costs to road users as well as escalating routine maintenance costs to
the road authorities.
 107

Figure 6-4
Road Construction Activity
Road improvement projects proposed for
Northern Corridor have a total cost of
US$741 million (Table 6-3). Together these
projects are expected to reduce price for
shipping on road segments of the
Northern Corridor by 17 percent, reduce
time by 18 percent and improve the
reliability of road transport services by 16
percent.

Table 6-3
Proposed Northern Corridor Road Projects
Dist. Cost Estimated Impact on Road
Improved (US$ Performance (%)
Name (km) million) Price Time Reliability
Capacity upgrades 1,339 234 -2 -3 -6
Road rehabilitation 864 363 - 10 -8 -7
Road upgrading to paved 319 143 -5 -7 -3
Total 2,522 740 - 17 - 18 - 16
Source: Prepared by Nathan Associates Inc.

CAPACITY UPGRADES
Analysis by Aurecon of road capacities using First Order Network Assessment (FONA)
has determined Level of Service (LOS) for the EAC road network, with indices ranging
from A (best operating conditions) to F (worst operating conditions). The best operating
conditions entail free flow high (design) average speeds and able to overtake easily.
Analysis was carried out for base and future (2020) scenarios. Immediate remedial action,
in terms of proving additional capacity principally by adding lanes (e.g. climbing lanes or
extra lane(s) for the whole identified length) has been recommended for roads with LOS E
and F. Roads with LOS D and C are to be investigated for remedial action later, estimated
from 2014. The Northern Corridor roads that are proposed for capacity upgrades is shown
in Figure 6-5 and listed in Table 6-4.
 108

Figure 6-5
Proposed Northern Corridor Road Capacity Upgrade Projects

There are already plans to expand capacity of some of roads listed below. However
implementation of the comprehensive program of road capacity upgrades as proposed
below needs to be pursued expeditiously in order to ensure there is adequate capacity for
smooth flow of growing traffic and trade along the roads.14

14 In addition to these projects, there is also a proposed new access road to the new Mombasa Container
terminal that is included within the scope of that port capacity expansion project.
 109

Table 6-4
Proposed Northern Corridor Road Capacity Upgrade Projects

Invest. Cost
Start Dist. (US$
Component Country Year (km) million) EIRR
(%)
Bujumbura – Kayanza Burundi 2011 8 1.6 7
Athi River Sorroundings Kenya 2011 16 6.5 56
Eldoret – Bungoma Kenya 2011 104 14.5 117
Molo – Eldoret Kenya 2011 127 17.7 157
Mombasa – Voi Kenya 2011 57 9.9 189
Voi - Kitui Rd Junction Kenya 2011 135 18.8 239
Fort Hall - Embu - Isiolo: (Moyale- Dodoma Spur) Kenya 2011 99 17.3 42
Fort Hall - Nyeri: (Moyale- Dodoma Spur) Kenya 2011 40 8.3 23
Kajiado - Namanga - Arusha: (Moyale- Dodoma Kenya 2011 32 6.7
76
Spur)
Thika - Garissa: (Fe (Moyale- Dodoma Spur) Kenya 2011 27 7.6 31
Bungoma/Eldoret junction - Kakamega: Kenya 2011 41 8.4
22
(Lokichogio Spur)
Eldoret - Kitale: (Lokichogio Spur) Kenya 2011 53 9.1 40
Kakamega - Kisumu: (Lokichogio Spur) Kenya 2011 49 10.3 27
Kisii and surroundings: (Lokichogio Spur) Kenya 2011 166 23.2 31
Kisumu and surroundings(Lokichogio Spur) Kenya 2011 46 9.5 26
Kitale and surroundings (Lokichogio Spur) Kenya 2011 21 4.3 22
Kampala - Masaka – Mbarara Uganda 2011 104 19.1 53
Kampala & surroundings (50 percent Jinja- Uganda 2011 81 14.1
45
Kampala)
Tororo - Bugiri - Jinja Uganda 2011 31 6.3 47
Kakamega - Kitale (Lokichogio spur) Kenya 2014 42 8.8 37
Byumba - Kigali Rwanda 2014 27 5.6 20
Kakitumba and surroundings Rwanda 2014 28 5.7 34
Jinja - and surroundings Uganda 2014 5 1.2 16
Total 1,339 234.5
Source: Prepared by Nathan Associates Inc.

ROAD REHABILITATION PROJECTS

The condition of East Africa Northern and Central Corridors road network was
comprehensively assessed in 2010 to determine the level of deterioration of pavement.
HDM derived International Road Indices (IRI) were established for all roads, ranging
from 0 (good) to 20 (very poor). Paved roads with roughness levels between 2 and 6 IRI
were classified to be in considerable sound state requiring no immediate remedial action,
but with the assumption that they will receive routine and periodic maintenance in time
to maintain conditions so as not to impact on productive capacity of the road.

Paved roads with roughness levels between IRI 6 and 10 were classified to be approaching
severe state or “warning state”, requiring rehabilitation within next 5 years. Paved roads
with roughness levels above 10 IRI were categorized as being in severe condition,
requiring immediate rehabilitation. Table 6-5 shows Northern Corridor roads in the latter
two categories, with those in severe condition programmed for rehabilitation within the
following four years and those in warning condition planned for rehabilitation from 2014.

There are already plans to rehabilitate some of roads listed below. However
implementation of the comprehensive program of road capacity upgrades as proposed
below needs to be pursued expeditiously in order to secure road conditions that will
facilitate smooth flow of growing traffic and trade along the Northern corridor.
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Table 6-5
Proposed Northern Corridor Road Rehabilitation Projects
Invest. Cost
Start Dist. (US$ EIRR
Component Country Year (km) million) (%)
Mwanza - Sirari/Kisii Tanzania 2011 239 100.4 38
Kisumu - Kakamega:(Lokichogio spur) Kenya 2014 94 39.5 36
Tororo – Jinja Uganda 2014 151 63.4 120
Kampala – Kabale Uganda 2014 380 159.6 74
Total 864 362.9
Source: Prepared by Nathan Associates Inc.

Figure 6-6
Northern Corridor Road Rehabilitation and Upgrading to Paved Projects by Type and Timing

Source: Aurecon, East African Transport Strategy and Regional Road Sector Development Program, 2010.

UPGRADING TO PAVED ROADS

Road condition assessments conducted by CDS/Nathan Inc, Aurecon and Louis Berger of
the East Africa road network has determined that 3,600 km of regional roads are gravel
surface on which vehicles operate with huge economic consequences (high cost and
consequent lack of facilitation of trade and thus economic growth). In order to reduce the
high economic cost there is need to upgrade them, especially those with relatively high
traffic levels. Among these are 319 km on the Northern Corridor. Given the level of traffic
on the concerned roads, there is need to upgrade them in the medium to long term.
Consequently, Table 6-6 lists roads of 319 km on the Northern Corridor that are
recommended for upgrade to paved standard from 2014.
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There are plans to upgrade some of roads listed below. However implementation of the
comprehensive program of road upgrades from gravel to paved standard as proposed
below needs to be pursued timely to mitigate the economic cost and unlocking further
economic opportunities.

Table 6-6
Proposed Northern Corridor Road Projects Upgrading to Paved Condition
Invest. Cost
Start Dist. (US$ EIRR
Component Country Year (km) million) (%)
Bujumbura -Gitega – Muyinga Burundi 2011 149 104.3 63
Nairobi and surroundings Kenya 2014 56 23.5 117
Nakuru- Londiani Kenya 2014 114 15.9 108
Total 319 143.7
Source: Prepared by Nathan Associates Inc.

DEVELOP ROAD MAINTENANCE CONTRACTING SYSTEM FOR NORTHERN

CORRIDOR (TA)
The condition of the Northern Corridor road network has passed through cycles
including periods of good condition, after rehabilitation with support of development
partners, back to poor condition needing another round of rehabilitation. The main reason
for deterioration of the roads, after periods of rehabilitation or upgrading, has been
mainly deferred maintenance due to inadequate financing and reported rampant
overloading. An appropriate management needs to be established to ensure adequate
maintenance is provided on time.

As regards maintenance, the Governments in whose countries the core Northern Corridor
road network traverses (Kenya, Uganda, Rwanda and Burundi), have established
dedicated Road Funds in order to ensure availability of finance to ensure adequate and
timely routine and periodic maintenance. However, there are still gaps in funding due to
large demand, which compete for financing from the Road Funds. In respect of
overloading, Kenya and Uganda the Highway Authorities are responsible for
weighbridges. The exception is the Mariakani weighbridge (near Mombasa) in Kenya,
which has been contracted to a private operator. If contraventions are detected,
prosecution are instituted (there is no option to pay admission of guilt fines and vehicles
are impounded until a court has issued judgment). There have been complaints of
ineffectiveness of the system to curb overloading and the soliciting of “unofficial”
payments at the weighbridges. However, improvements are being made or are planned.

In order to ensure that roads receive regular maintenance as required, a proposal has been
made that the core corridor roads be put under long term performance based contract.
The contract would include the requirement to keep the roads at an agreed level of
condition, including ensuring that roads are not damaged due to overloading. Financing
of the contract will be from a combination of sources including road public funds (from
Road Fund/Government and, in some cases, possible tolling). However, this will not
apply for some sections, which may be transformed to full “toll roads”, given their very
high level of traffic with commercial viability.
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Roads are managed by Road Agencies/Authorities and maintained on contract for

specific works defined such as routine maintenance, re-sealing/periodic maintenance.
Finance is from Road funds and Government budget allocation. When there is no finance,
maintenance is postponed, thus accumulating deferred maintenance and accelerated road
deterioration. Overload control is managed by the Road Authorities in Kenya (KenHA)
and Uganda via weighbridges. Rwanda and Burundi are in the process of establishing
weighbridges at and similar vehicle overload control systems.

The project consists of (1)- an assessment to identify technical, legal, institutional, finance
and methodological frameworks and approaches to implement long term contracts, as
well as to define possible packages/sections to be put under such contract; (2) transaction
advisory services to structure identified possible contracts, prepare RFPs and assist with
procurement of maintenance contractors.

LEADERSHIP BY NCTTCA (TA)

Many of the infrastructure and facilitation improvements should be done on a corridor
basis. Improvement is a dynamic process driven by dialogue between public and private
sectors. The Northern Corridor Transit Transport Coordination Authority (NCTTCA) was
formed to facilitate implementation of the Northern Corridor Transit Agreement signed in
1986/1987 among the participating countries of Kenya, Uganda, Rwanda, Burundi and
DRC to guarantee the land locked countries access to the sea for trade. These countries
signed a Revised Agreement in 2009, with similar objectives.

The objective is to insure effective operation of transport, logistics and trade on the
corridor in the interest of all member countries. With this mandate and structures, they
are ideally suited to promote the infrastructure, facilitation and legal and regulatory
framework identified by the Corridor Diagnostic Study (CDS) to strengthen corridor
infrastructure and operations. NCTTCA has specialists on staff for infrastructure,
facilitation and trade and some resources provided by members. Nevertheless, they need
assistance to develop a sustainable plan for advocacy and fostering stakeholder actions to
implement measures identified to achieve necessary improvements. This TA should be
integrated with the other facilitation TAs provided by the East Africa Trade Facilitation
project, TradeMark EA, COMPETE project, the SSATP and JICA to build a sustainable
way forward to achieve on-going corridor improvement targets.

The NCTTCA has been active since 1987 and has an agreed action plan and financing
mechanism. Many decisions have been made with implementation either still
outstanding or not effected as expected. A series of studies have recently been carried out
for them, including the recent transport observatory, master plan for infrastructure
development just being completed and a study of transport costs on the corridor. A
spatial development study has also been carried out to review the opportunities for value-
added resource businesses and manufacturing on the Northern Corridor. Each of these
studies makes a series of recommendations to NCTTCA. CDS, which has taken into
account all these studies, quantifies the time, price and reliability of transport and logistics
operations and recommends investments to make the Northern Corridor perform better.
Therefore the NCTTCA has a recommended Action Plan and substantial data to support
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it. NCTTCA is well established, but needs a way to more fully engage their public sector
members in the improvement process and to more fully incorporate the private sector in
identifying problems and solutions. Specifically NCTTCA needs to establish a monitoring
system of implementation of the action plan, securing fulfillment of commitments made
by its members and publishing impact of implementation for the benefit of users of the
corridor. As NCTTCA seeks to implement the Action Plan, it needs access to some
additional TA and field work on a demand basis.

This assistance would consist of two parts, TA and workshop support. The TA would
assist in establishing a consultative public private process, based on the recent studies, to
set the work agenda and commit government agencies and private sector to responsibility
for specific tasks to motivate and monitor achievement of the CDS Action Plan. NCTTCA
would need to create a stronger mechanism for delivering this commitment of both public
and private sectors. Once initiated, progress toward agreed outputs would be assessed
and redirected every six months. TA would fund meetings for the first two years, and
fund 50 percent for the third year as the mechanism is made sustainable

This initiative will be successful if all the participating members agree to devote time to
specific tasks because they are committed to the goals. The Northern Corridor has tended
to rely on donor support and outside consultants. This TA is intended to encourage
active involvement from their staff and members to make the activities sustainable and to
reduce the dependence on outside consultants. This TA is designed to allow TTCA to
pilot the methodology on several priority issues identified by CDS and to do so in a way
that the model is sustainable. It will also depend on member buy-in to be successful.
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7. Proposed Projects for Improving

Central Corridor Performance
In this section we present an overview of specific infrastructure projects that have been
identified to improve the performance of the Central Corridor in the next five years. The
projects are presented by transport mode in the sections below. Projects were selected for
the Action Plan based upon the strategies for improving the Northern Corridor
performance described in Chapter 5 and their potential to have a significant impact on the
corridor’s performance in terms of time, cost and reliability. All of the proposed projects
are also deemed to have a medium to high economic viability. Detailed project profiles of
these proposed infrastructure interventions are presented in Appendix A.

Dar Es Salaam Port

Four infrastructure projects are proposed for the port of Dar es Salaam with a total cost of
nearly US$ 550 million (Table 7-1). Together these projects are expected to reduce time on
port node by 48 percent, reduce port related prices by 10 percent and improve the
reliability by 35 percent.

Table 7-1
Proposed Projects for Dar es Salaam Port
Estimated Impact on Port
Cost Performance (%)
(US$ EIRR
Price Time Reliability
Name million) (%)
Dar es Salaam Short-term Container Handling 26 -2 - 16 -7 226
Capacity Enhancement (ICDs)
Dar es Salaam Single Point Mooring 69 -5 - 12 - 13 35
Dar es Salaam Container Terminal (Berth 13 -14) 450 -1 - 15 -7 35
Dar es Salaam Dry Bulk and Break Bulk Facilities 5 -2 -5 -8 25
Total 550 - 10 - 48 - 35
Source: Prepared by Nathan Associates Inc.
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Figure 7-1
Port of Dar es Salaam Master Plan

DAR ES SALAAM SHORT-TERM CONTAINER HANDLING CAPACITY

ENHANCEMENT WITH ICDS
The Dar es Salaam container handling terminal (Berths 8–11) is operating at full capacity:
Berth occupancy in 2009 was at around 90 percent as opposed to ideal 70 percent or
below. Even with the supplemental container handling capacity at conventional terminal
(Berths 5–7), the estimated combined port container handling capacity of 310,000 TEU is
below the 2009 throughput of around 354,000 TEU. Planned new capacity, in particular a
new terminal at new Berths 13 - 14, is expected to be available 2014–2015, more likely the
latter date. Given the continued growth of container traffic, recorded at an average 13
percent during 2000–2008, this means that without any other intervention to create
additional capacity in the short-term, there will be severe congestion with disastrous
results for the port and trade in three to five years until new terminal or additional
capacity is available.

During the last crisis of severe congestion, the off- dock ICDs were engaged in 2007 and
have helped decongest the port. In this regard, some of domestic containers are
transferred to ICDs and in the process removing some of the activities from the port
container yards to create more operating space. The proposal is to build on this experience
by formally integrating ICDs into the port system to create much needed additional space,
higher productivity and, thus, additional capacity to handle ships and containers. The
proposed ICDs Integration Program comprises:

• Relocating all container processing activities from marine yard to ICDs, thus
moving entire ships to ICDs, contracted by shipping lines competitively (based
on quality of service and price). Possible exception could be ready to go rail
bound boxes;
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• Simplifying of transfers between marine yard and ICDs including automation of

marine gate and use of high capacity and specially tagged trucks to provide
shuttle services; and

• ICDs enhancing facilities and technical competency to handle increased transfers

from marine yard and to service clients,

• Securing acceptance of the proposal by key players and decision makers,

especially government, TPA and TRA.

The proposal has been discussed by stakeholders at a roundtable meeting and adjudged
beneficial. It is estimated that implementation of the ICDs integration program may result
in increase of capacity up to 1,050,000 TEU that would be adequate for at least another
eight to ten years. This would avoid the cost associated with long waiting times of ships,
low productivity of expensive berth facilities and equipment as well as surcharges by
shipping lines: these far outweigh the additional costs and extra time for transfers to
ICDs.

DAR ES SALAAM CONTAINER TERMINAL (BERTHS 13 AND 14)

Container traffic is handled at specialized container terminal (Berth 8 – 11), concessioned
to the Tanzania International Container Services (TICTS), with Hutchinson HP holding
majority shares, and at conventional terminal (Berths 5 -7). In 2009, the Port of Dar es
Salaam handled 373,500 TEUs with a berth occupancy rate of 88.7 percent as opposed to
ideal around 60 - 70 percent. Between 2000 and 2008, average annual growth rate has been
13.5 percent, meaning that additional capacity is urgently needed.

In 2008, dwell time reached 28 days, due mainly to congestion, and the port sought to
relieve the capacity problems in the port by using ICDs to handle some domestic
containers for clearances. This has improved port performance but has not addressed
future capacity needs given the high rate of container traffic growth. Consequently,
within the recently completed Ports Master Plan (2009) TPA has determined that a new
terminal was needed. TPA plans to develop the terminal and tender it to a private
operator, preferably in competition with TICTS. A feasibility study was completed in
2010. A consultant to prepare detailed design has been procured and design is ongoing.
Negotiations are also ongoing with the Chinese Government to provide financial support.

The new terminal will have a capacity of 600,000 TEU. Once both the existing and new
terminals operate at more optimum levels, better port performance is expected. Having
two competing terminals should drive the cost and delays down thus benefitting the
shipper. The diagnostic study demonstrated that the port constituted the single greatest
delay factor on the corridors. It is thus expected that the second terminal will assist to
decongest both terminals, thereby reducing the delay factors at the port, beyond the short-
term relief expected from implementing the proposed integrated ICD system.

ENHANCING PORT OPERATION WITH ICT APPLICATIONS (TA)

A community-based/single window system is essential to decrease clearance times
needed to handle the level of traffic anticipated for Mombasa. Currently, individual
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procedures in the port can take two to three days. And if performed consecutively, can
take a total of twelve to twenty days. Other delay factors include submitted documents
being incomplete, one agency taking paperwork out of the chain so it doesn’t get
processed, clearing agents/shippers being slow to pay fees and duties, shippers
intentionally using the port/ICD for storage, not tracking location of containers, or
stacking over five containers because of lack of space.

A community based system is designed to address this. The computer tracks procedures
and payments as they are initiated and completed. This allows the stakeholders to know
where the container is in the process toward release, thereby enabling interventions to
complete the process. It allows coordination of port procedures through sending alerts
that an action is needed and overall monitoring to identify problems to be addressed. A
single window system allows one agency to act on behalf of all parties in entering and
tracking of containers procedures. It includes all the risk parameters and requirements for
most commodities so that the clearance can be completely automated and no human
intervention is needed. This leads to greater efficiency and transparency. Because time
delays at the Port of Dar es Salaam are one of its largest handicaps and the greatest time
factor on the entire Central Corridor, this is a high priority project.

Tanzania Ports Authority requested funding a feasibility study for a community-based

system under the East Africa Trade and Transport Facilitation Project. This feasibility
study for the implementation of a community-based system has now been completed.
The Dar es Salaam port community is in process of setting up an organization to develop
and implement the system.

The community-based system is essential to achieving the clearance times needed to

handle the level of traffic projected for the port of Dar es Salaam. This Project would
establish a response mechanism for short term technical assistance as needed in the
development and implementation of the system. An overall budget would be established
and the port would be able to draw down on it as problems are encountered that are not
addressed in long term financing commitment to the project. A separate budget would be
established for incorporation of off the shelf software and adaptation as necessary. The
Project would provide assistance in acquiring software on a PPP basis which may include
involvement of software developer on an equity or loan basis.

This system has the potential to reduce dwell time to three to four days overall. It will
enable the coordination of functions necessary to the most efficient processing of persons
and goods. The single window system facilitates optimum coordination among agencies
at the port. As it tracks and monitors the process electronically, it has the capacity to
reduce corruption as well since they remove much of the decision making from humans
to computer systems.

DAR ES SALAAM SINGLE POINT MOORING (SPM)

The original SPM was built in the 1970s to supply crude to refineries in Tanzania and
Zambia. After closure of the Tanzanian refinery, it served only Zambia. Zambia
consumed 15,300 million barrels of crude in 2009 of which 15,110 million barrels are
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imported. Its total refining capacity is 24,000 million barrels. However, there are plans to
establish a new modern refinery in Tanzania with new pipelines to Mwanza and Kigoma,
Discussions have been carried out with potential international private sector developers.
A significant share of Zambia’s petroleum is crude oil shipped from the Port of Dar es
Salaam via pipeline to the Indeni Petroleum Refinery in Ndola at a considerable savings
in cost over importation of finished product by rail or road and reduced theft and accident
risk. TAZAMA Pipeline is jointly owned by Zambia (66.7 percent) and Tanzania (33.3
percent). As part of the Tanzania Ports Master Plan, Royal Haskoning reviewed the
market for petroleum through the port of Dar es Salaam and found a viable market in
nearby countries.

The project consists of construction of the SPM and two subsea pipelines. One will be 28”
in diameter for crude oil and one 24” for white product, with a length of 4.5 km and 4 km
respectively. The SPM is being constructed southeast of the harbor entrance and will
accommodate ships from 40-150 KDWT. The project is based on projections of increased
domestic and regional demand for crude and white product to be delivered on the new
system. It also assumes the probably redevelopment of a refinery in Dar es Salaam. The
project viability will depend on the success in marketing the product regionally based on
the reduced price of pipeline as opposed to road and rail transport delivery.

TPA expects the new facility to provide increased revenue in addition to improvement in
quality of service, safety, efficiency and the capacity to handle bigger vessels. The Port of
Dar es Salaam and particularly the oil terminals are congested with frequent wait times
off shore and terminal delays. All these delays increase the cost of delivered fuel. The
SPM should eliminate the delay factors for petroleum deliveries to Dar es Salaam and
reduce the delays of other vessels using the entrance channel.

CONVERSION OF SELECTED GENERAL CARGO FACILITIES TO DRY BULK

The port has a rated capacity of 4.1 million dwt dry bulk cargo handled at Berths 1 -7. This
is sufficient for the near term, but high estimates put the requirement for 2023 at 4.8
million tons and for 2028 at 6.1 million tons. The efficiency of the operation is also a major
factor, with delays in ship offloading causing penalty charges which are passed to
customers. Dry bulk is generally handled at Berths 5, 6 and 7, but only 7 can handle
vessels with drafts exceeding 9.5 m. To cater for future demand it is estimated that grain
storage should be increased to 60,000 tons from 30,000 at the existing silo. A private
organization, the Dar es Salaam Corridor Group, is building a grain facility close to the
port, and is designed to be linked to the terminal with conveyors.

General cargo is also increasing although more slowly. It is expected to approximately

double from 2013 to 2023, from 655,000 tons to 1.3 million tons. By 2028, it is estimated to
be 1.8 million tons. Break bulk is currently offloaded at Berths 1-7, depending on vessel
draft and berth availability. To accommodate this growth and achieve greater efficiency, it
is recommended to deepen Berths 1-4 to allow larger ships and make better use of the
existing port.
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TPA has begun to implement these recommendations to improve port infrastructure at

the bulk terminals. Major components of the projects involved are:

• Creation of a specialized dry bulk terminal at Berths 5-7 and dredging to -12 m and
the quay strengthened to accommodate heavier cranes and deeper drafted
vessels. A conveyor belt is planned to move cement to the packaging area;

• Expansion of the grain silo from 30,000 to 60,000 tons to allow handling of larger
vessels;

• Strengthening the quay at Berths 1-4 and dredging to a depth of -12 m as well as
adding 260 m to the quay length, which is anticipated to meet requirements to
handle break bulk goods until 2028; and

• Developing a dedicated general cargo facility at Berths 1-4.

Both dry bulk and break bulk are increasing rapidly. The development of dedicated
terminals and more efficient handling operations will foster this growth. In both cases,
larger vessels are encouraged through greater depth and length of the quay. This will
enable faster loading and unloading times and should mean lower costs due to economies
of scale and improved productivity.

NEW ROAD ACCESS TO DAR ES SALAAM PORT15

Heavy goods or commercial vehicles destined to or from the port of Dar es Salaam have to
drive to heavily congested areas in the city via Bandari Road, Mandela Highway and
Morogoro Road/TANZAM Highway. The areas of notable urban traffic extend to
between 15 – 20 km from the port. Sometimes during peak hours the heavy duty vehicles
are required to park around 15 km away to wait for off peak times. These roads carry
traffic to Southern Tanzania and Southern Africa (Zambia, Malawi and DRC/Katanga),
Central and Western Tanzania and Central Africa/Great Lakes countries (Burundi,
Rwanda, Eastern DRC and Uganda) and Northern Tanzania and Kenya. They all use a
common section up to 100 km away (Chalinze) where traffic to the north branches off. The
proposal is to develop a highway which bypasses these congested areas from the port to
rejoin the TANZAM Highway about 65 km away or more (Mlandizi or beyond). Due to
the volume involved, this road is considered a good candidate for a toll road.

Mandela Road is undergoing rehabilitation and slight improvement with grade separated
flyovers at critical junctions. There are also plans to further widen Morogoro Road and
lengthen the distance with dual carriageway to about 25 km from the port. Some further
ring roads are planned, which will take some of the traffic away from Morogoro Road.
However, at the rate that traffic is growing around Dar es Salaam and the expected
continued vibrant economic growth of the Dar es Salaam port hinterland (Tanzania and
neighbors), there is need to prepare adequately by looking for alternative options beyond
these roads. Initially a feasibility study should be undertaken to establish the best option.

15 This project and its costs have been included as one of the proposed road capacity upgrade projects for
the Central Corridor discussed in the Roads section later in this chapter.
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This project is still at conceptual stage. However, the Development Bank of Southern
Africa had in 2008 expressed interest to finance a feasibility study for the road, as part of
follow up to Central Development Corridor (CDC) work. The components include (1) -
Feasibility study; (2) Transaction Advisory services to structure a PPP, prepare an RFP
and assist with procurement of developers; and (3) construction and management of the
road.

Rail
As shown in Table 7-2, seven infrastructure projects are proposed for improving the
performance of the TRL rail system for Northern Corridor with a total cost of US$ 537
million. Together these projects are expected to reduce price on rail segments of the
Northern Corridor by 20 percent, reduce time of rail transport by 14 percent and improve
the reliability of rail transport services by 25 percent.

Table 7-2
Proposed Central Corridor Rail Projects

Estimated Impact on Rail

Cost Performance
(US$
Name million) Price Time Reliability EIRR (%)

TRL Revival Infrastructure, Rolling Stock,

185 -15 -11 -19 38
Working Capital and Isaka ICD
TRL Track Infrastructure Upgrade 3-5 years 350 -4 -3 -5 27
Dar es Salaam CFS Site Selection and Project
2 -1 -1 -1 n.a.
Preparation (Kisarawe)
Total 537 - 20 - 14 - 25
Source: Prepared by Nathan Associates Inc.

A description of each of these rail projects is presented below.

PROCURE AND RETAIN TRL MANAGEMENT TEAM (TA)

The Tanzania Railway Corporation/Tanzania Railways Limited (TRC / TRL) serves the
land locked countries of Uganda, Rwanda, Burundi and south eastern DRC. Traditionally
the system carried between 1.2 mtpa and 1.5 mtpa, but in the past six years traffic has
fallen to below 0.5 mtpa due to a series of specific events: (i) lack of investment and poor
performance of the railways over the period; (ii) the suspension of the Ugandan rail ferry
service; (iii) the 2009 flood damage, causing a six month service suspension, and (iv) the
failure of the concession with Rites, operating as TRL. The TRL service is particularly
critical for Burundi, because it previously carried all Burundi’s international trade, which
is now routed via a much longer and more expensive road route. The same applies to
trade with the eastern DRC through the lake ports of Kigoma and Kalemie. The TRL
service also provides the shortest distance to any port from Rwanda, and the decline of
the lake and rail service has resulted in Rwandan transit traffic being shifted from the
Central to the Northern corridor, at additional cost. As a result of the failed concession,
the budget allocated for the revival of the system is no longer available. Urgent outside
assistance is needed
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TRL is currently in an interim stage, being managed through RAHCO, with TRL staff
salaries being guaranteed by government, but TRL being responsible for all other
operating costs. RAHCO has sought financial support through government for a total
investment of US$ 90 million in track repair and upgrades in the first three years. There
appears to be no possibility for funding future TRL operations without the preparation of
a detailed, realistic and credible business plan, which is focused on core business, linked
to increasing freight traffic volumes. At the present time, TRL is unable to serve major
new customers without additional up front funding to improve the performance of both
infrastructure and equipment.

The first phase of the project will include preparation of the TOR for a management
contract, working jointly with MOID and RAHCO, motivation of funding for the
management contract (estimated at US$ 2 million over two years), preparation of
tendering process, prequalification, adjudication, preparation of management contract
and appointment of management contractor.

In the second phase of the proposed project, the recruited TRL management team will be
retained for a period of two years, manage the operation of TRL, prepare detailed
business plans, including cash flows and financing schedule, presentation of business
plan to secure funding, prepare and implement marketing plan to target intermodal
sector and increase freight levels. A study will assess options for future operational
structure for TRL and prepare contracts for operating concession. The cost of the
management contract that will require institutional funding through government is
estimated at US$ 2 million.

TANZANIA RAILWAYS LTD. REVIVAL – INFRASTRUCTURE ROLLING STOCK

AND WORKING CAPITAL

The Tanzania Railway Corporation/Tanzania Railways Limited (TRC / TRL) service has
declined over the past five to six years and traffic levels have fallen to less than 30 percent
of the previous highest levels, mainly due to the following events: (i) lack of investment
and poor performance of the railways over the period, (ii) the suspension of the Ugandan
rail ferry service; (iii) the 2009 flood damage, causing a six month service suspension, and
(iv) the failure of the concession with Rites, operating as TRL. The absence of new
investment, the declining income and lack of working capital resulted in deferred
maintenance of both track infrastructure and equipment, leading to an increasingly
unpredictable and unreliable service, and which has severely restricted operating
capacity, and the ability to existing and new customers.

TRL is unable to implement a short-term sustainable revival plan without a substantial

capital investment, estimated to be about US$ 110 million over a two year period. The
capital injection will be required to be justified by a detailed business plan to be prepared
by a new management team to be appointed. The TRL service is particularly critical for
Burundi, because it previously carried all Burundi’s international trade, which is now
routed via a much longer and more expensive road route. The same applies to trade with
the eastern DRC through the lake ports of Kigoma and Kalemie. The TRL service also
provides the shortest distance to any port from Rwanda, and the decline of the lake and
 122

rail service has resulted in Rwandan transit traffic being shifted from the Central to the
Northern Corridor, at additional cost. As a result of the failed concession, the original
budget allocated for the revival of the system, particularly the repair and upgrading of
track, (some sections of track date back to 1912), is no longer available.

In respect of the locomotive fleet, when the TRL concession commenced in 2006, the total
diesel electric locomotive fleet numbered eighty-two units, of which only sixty-five were
considered operational, but most of which suffered from deferred maintenance, which
translated into very poor reliability. In addition, TRL has thirty-four smaller diesel
hydraulic ‘shunting’ locomotives, of which twenty-seven were recorded as being active.
The core of the mainline locomotive fleet consists of thirty-five Canadian MLW
Bombardier locomotives, relatively small locomotives of 1,200 hp, of a similar size to
those used by Uganda Railways. MLW in Canada ceased diesel electric locomotive
production in 1985 (twenty five years ago), and were taken over by GE, which closed the
plant in 1993. The bulk of the TRL locomotive fleet can be considered to be beyond its
economic life, although it has been possible to keep most of the locomotives operational
through a process of continuous repair. When the Government and Rites of India TRL
concession commenced operation in 2006, twenty-five used locomotives were imported
from India on a lease basis to supplement and replace the MLW units. However the
Indian locomotives were not put into service with TRL because of a dispute with the TRL
workforce, which considered them to be no better than the existing TRL locomotives. The
situation appears to have been resolved in January 2011, but TRL urgently needs to
supplement their fleet of available locomotive through repair, acquisition and/or leasing.

When the TRL concession commenced in 2006, the total wagon fleet numbered 1,847 units,
of which 1,245 were considered operational, but many of which were ‘outdated’ in their
function – such as cattle wagons and many of the large covered wagons, suitable for break
bulk only. Almost all the wagons are of the bogie type, having two sets of two 15 t axles,
capable of carrying up to 43 t of freight. Many of the wagons also suffer from deferred
maintenance, and poor reliability. Typically, it is the bearings, wheels and brakes that
require attention. The bulk of the freight wagon fleet should ideally consist mostly of low
sided open wagons, which can carry heavy bulk goods and also ‘drop in’ containers – two
TEU, and also specialized container wagons and fuel wagons. The current fleet consists of
232 high and low sided open wagons, 84 specialized container wagons, and 145 fuel
tanker wagons. Many of the covered wagons, which number more than 720, could be
converted to open wagons or container wagons. It is also a relatively cheap and simple
process to convert older plain bearing wagons to more reliable and heavier roller bearing
axles – this has been carried out extensively in South Africa, Zimbabwe and Mozambique
where some serviceable and operating wagons are more than fifty years old. The
configuration of the TRL wagon fleet needs to be updated to reflect the future projected
freight profile, as defined by the new ‘revival’ business plan.

In order to recapture freight volumes from road haulers, TRL needs to further develop an
efficient road/rail transfer terminal at Isaka to serve the mining Tanzanian mining and
agricultural sectors and the Rwandan market. Prior to 2004, the TRL rail service on the
Central Corridor carried virtually all the transit traffic between the port of Dar es Salaam
 123

and the land locked countries of Rwanda and Burundi, and also a significant portion of
the trade with Uganda and the eastern DRC. There were also block or unit train
operations between Dar es Salaam and Isaka. Since the decline of the TRL service over the
past seven to eight years, reflected as lack of capacity and unreliability, most of the
Central Corridor transit traffic has moved to road transportation, and in respect of
Uganda and Rwanda, there has been a major diversion to the Northern Corridor serving
the port of Mombasa. In the case of Rwanda, this has resulted in a longer and more
expensive route for international trade, and for transit trade via Dar es Salaam, a much
more expensive road service. The business plan for the planned revival of TRL over the
next two years will include a target to recapture the Rwanda transit traffic as a
multimodal service – by rail between Dar es Salaam and Isaka, about 900 km, and by road
between Isaka and Kigali, about 460 km. The development of the Isaka ICD should be
promoted by TRL as a railway services marketing drive, to serve Rwanda and north
eastern region of Tanzania, including the rapidly developing mining sector, as well as
parts of Eastern DRC close to Rwanda.

The project consists of funding and implementation of a (1) short term capital investment
program for TRL and (2) provision of working capital, over a two year period, to secure
the operational improvement of TRL under a new management team to be appointed. The
main components of the investment program will be ongoing track repair and upgrading
in specified areas. This will be supported by a complementary program for repair and
refurbishment of TRL wagons and locomotives, with possible leasing of additional
equipment as defined by the approved business plan, which could include any or all of
the following options:

• Repair and upgrading of selected units in the existing MLW fleet. (mainline
locomotives in South Africa continue to be upgraded and serviceable beyond the
age of fifty years in the case of GM or GE units).
• Purchase of new locomotives, most likely remanufactured units, up to 2,000 hp,
at a cost of about US$ 1.5 million each.
• Leasing of locomotives on long term basis, possibly including an agreement on
the twenty-five small Indian locomotives already held, alternatively from other
regional railway companies such as NRZ in Zimbabwe, modified to 1,000 mm
gauge, likely to cost up to US$ 1,200/day on a full maintenance basis.

The TRL operational wagon fleet should be configured in accordance with the
requirements of the revival business plan. Assuming an initial target of 3 freight train per
day, a 7 day train turnaround, and train lengths of 30 wagons, a fleet of 700 to 800 wagons
of the specified types should be available at all times. There are several options which can
be pursued simultaneously and jointly:

• Repair, upgrading and modification of existing wagons, and where appropriate,

conversion to roller bearing axles, and fitting of dual vacuum and air brakes.
• Purchase of new wagons, mainly container wagons or open bulk wagons, at a
cost of about US$ 50,000 each. Fuel tanker wagons and other special purpose
wagons will be more expensive, and should ideally be linked to specific transport
contracts.
• Leasing of wagons on long term basis from other regional railway companies
such as NRZ in Zimbabwe, modified to 1,000 mm gauge, likely to cost up to US$
 124

30/day on a full maintenance basis. Leasing will often promote a higher degree
of equipment utilization.
• Encouraging customers to invest in or to supply their own dedicated wagons, to
be operated by TRL, in exchange for a discounted rail tariff

The construction of a new Isaka ICD, capable of handling full TRL unit trains of about
thirty wagons in the initial phases, ideally with loading and unloading of containers by
RMGs, alternatively forklifts in the first phase, provision of large paved container storage
areas, equipped with reach stacker(s), truck parking and access, fueling points (service
station), administration block, telecommunications, possible ware housing and
accommodation with cargo distribution and consolidation services. Initial requirement
about 10 ha, phased development (could be similar to the small Kidatu ICD which links
the TRL and TAZARA railways, which was fully equipped, also with ware housing, and a
reach stacker). This should be complimented by an equally efficient rail intermodal
terminal in the port of Dar es Salaam.

DAR ES SALAAM CARGO FREIGHT STATION (KISARAWE)

The Tanzania Ports Authority (TPA) has recognized that the operational efficiency of the
port of Dar es Salaam is being adversely affected by both congestion within the port
terminals and by road congestion within the city. The implementation of a system of ICDs
within the city has provided a solution to the problem of port terminal congestion, with
resulting improved terminal efficiency, but the problem of city road congestion remains.
In order to further improve the efficiency of the container terminal and to provide much
needed additional space, it has been proposed to develop a system of near port ICDs,
integrated with the port terminal operations, as an extension to the port. The intention is
to transfer all import containers to the integrated ICDs by means of a low cost tractor
trailer container shuttle service, except those containers which are specifically booked on
rail (mainly transit traffic).

TPA has proposed to develop a Cargo Freight Station (CFS) in an area called Kisarawe,
about 35 km from the port, and to connect this to the port terminals by dedicated railway
shuttle service. The main function of the CFS is to serve as a road/rail transshipment
centre for transit goods, a logistics center to provide freight consolidation, distribution
and container stuffing and de-stuffing services, long term storage, car storage etc. A key
objective is for the CFS to promote the development of a surrounding industrial zone, for
further processing and value adding of exports and imports. Domestic imports will
logically be routed through the integrated ICDs, and rail bound transit traffic will bypass
both ICDs and the CFS. In order for the CFS to serve it’s intended function, it will be
necessary to provide a direct connections to the main transit routes for both road and rail
– by road to the Morogoro road, and by rail to the main lines of both Tazara and TRL. The
CFS, being a TPA project, should not become a monopoly but compete with other ICDs.
The distances between the road and rail routes vary considerable in relation to the
distance from the port. It is quite apparent that road and rail connections, and also the
provision of other services, will be a very high cost component of the CFS development,
and the final chosen location of the CFS will require to be optimized in respect of
infrastructure costs, compared to other economic and environmental considerations.
 125

Figure 7-2
Proposed Site for Kisarawe ICD

The World Bank has supported the concept of establishing a remote CFS at Dar es Salaam
by funding a pre-feasibility study, which was completed in December 2010. However, the
proposed site for the CFS as shown in the study was chosen in fairly arbitrary manner,
without a detailed site selection study having been carried out. The cost estimates for the
project, given in the study as US$183 mill, have not been subjected to an optimization
process in respect of site preparation and the provision of transport infrastructure and
other services. A detailed site selection study needs to be carried out, (selection matrix
which includes all influencing factors) prior to finalizing the layout and design of the CFS.
This could possibly be done in conjunction with the issuing of an EOI for the location,
design and development of a CFS, based on the preliminary study, in order to test private
sector investor and operator interest in the project at an early stage. The World Bank has
expressed readiness to support appointment of a transaction advisor for the project.

The project preparation, including site optimum location and design for the development
of a remote cargo freight station for Dar es Salaam, including the provision for a
surrounding industrial development zone, as PPP project.: This will require coordination
within TPA on the main functions of both the ICDs and CFS, and planning of the shuttle
services. Commitments will be required from TRL and TAZARA for the planned railway.

TRL TRACK INFRASTRUCTURE UPGRADE: 3 - 5 YEARS

The current track TRL infrastructure consists of long sections of light 30 lb/yard track,
mostly in poor condition. The RAHCO action plan presented to the 4th JISR in September
2010, earmarked 330 km of track due for urgent upgrading, including strengthening of
bridges to carry heavier axle loads. The main objective of the medium term TRL
infrastructure upgrade is to replace all the 30 lb/yard track with new rails of not less than
40 lb/yard, in order to increase permissible axle loads and the operation of longer trains
at higher speeds. Increased volumes will also bring the need for improved signaling
systems. The proposals for the construction of a new railway line from Isaka to Rwanda
and Burundi, is seen as a longer term development, most likely linked to demand from
 126

the mining sector for bulk exports – similarly the proposals for a new standard gauge
railway from Dar es Salaam to Isaka. Upgrading of the existing TRL track could in some
sections be carried out with provision for future conversion to standard gauge.

Phased upgrading of the TRL track infrastructure and signaling systems will allow more
modern and competitive train service to be operated—axle loads for 18–20 tons, longer
trains, faster transit and turnaround times, and greater reliability. In the first instance, this
will entail the track infrastructure to be upgraded with heavier rails and structures to a
uniform standard on all the main lines, commencing with the lines between Dar es
Salaam, Mwanza and Kigoma. It is expected that the rail service to Tanga and Arusha will
be reopened and upgraded to the same standard

The infrastructure upgrade will further increase reliability and serve as an additional
incentive for the development of the nickel mining sector in Burundi and north eastern
Tanzania. Track upgrading will also allow the transport of heavy abnormal loads for the
mining industry – the cost of road transport of heavy equipment within Tanzania is
presently prohibitive.

Roads
As described in Chapter 3, an assessment of Central Corridor road network was carried
out by Aurecon for the East African Transport Strategy and Regional Road Sector
Development Program conducted for the EAC in 2010. This assessment resulted in the
identification of three categories of road improvements:

• Upgrade Road Capacity. Immediate remedial action, in terms of proving

additional capacity principally by adding lanes (e.g. climbing lanes or extra
lane(s) for the whole identified length) is recommended for roads with level of
service E and F. Roads with LOS D and C are to be investigated for remedial
action later.

• Rehabilitation of Paved Roads. is triggered for a paved road once its overall
condition has deteriorated beyond the point where preventive and routine
maintenance can uphold the pavement at a functional level.

• Upgrade to Paved Standards. Gravel roads with traffic volumes in excess of 200
vehicles per day operate under poor riding quality conditions and generate
excessive costs to road users as well as escalating routine maintenance costs to
the road authorities.

Three types of infrastructure projects are proposed for improving the performance of the
road transport system for Northern Corridor, for a cost of US$ 0.9 million (Table 7-3).
Together these projects are expected to reduce price on road segments of the Northern
Corridor by 6 percent, reduce time of road transport by 11 percent, and improve the
reliability of road transport services by 4 percent.
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Table 7-3
Proposed Central Corridor Road Projects
Distance Cost Estimated Impact on Road
Improved (US$ Performance (%)
Name (km) million) Price Time Reliability
Capacity upgrades 189 61.7 -1 -2 -2
Road rehabilitation 732 331.0 -2 -3 -1
Road upgrading to paved 774 543.8 -3 -6 -1
Total 1,695 936.5 -6 - 11 -4
Source: Prepared by Nathan Associates Inc.

CAPACITY UPGRADES
Analysis by Aurecon of road capacities using First Order Network Assessment (FONA)
has determined Level of Service (LOS) for the EAC road network, with indices ranging
from A (for best operating conditions) to F (for worst operating conditions). The best
operating conditions entail free flow high (design) average speeds and able to overtake
easily. Analysis was carried out for base and future (2020) scenarios. Immediate remedial
action, in terms of proving additional capacity principally by adding lanes (e.g., climbing
lanes or extra lane(s) for the whole identified length) has been recommended for roads
with LOS E and F. Roads with LOS D and C are to be investigated for remedial action
later, estimated from 2014. The Central Corridor roads that are proposed for capacity
upgrades is shown in Figure 7-2 and listed in Table 7-4.

Figure 7-3
Proposed Central Corridor Road Capacity Upgrade Projects

There are already plans to expand capacity of some of roads listed below. However
implementation of the comprehensive program of road capacity upgrades as proposed
 128

below needs to be pursued expeditiously in order to ensure there is adequate capacity for
smooth flow of growing traffic and trade along the roads.

Table 7-4
Proposed Central Corridor Road Capacity Upgrade Projects
Invest. Cost
Start Dist. (US$
Component Country Year (km) million)
Bujumbura – Gitega Burundi 2011 6 1.1
Kibungo – Kigali Rwanda 2014 32 6.7
Dar es Salaam - Mbezi Tanzania 2014 25 5.1
Dar es Salaam port access bypass ( to Mlandizi) New Tanzania 2014 75 40.0
constr.
Dodoma - Arusha (Dodoma feeder) Tanzania 2014 51 8.8
Total 189 61.7
Source: Prepared by Nathan Associates Inc.

ROAD REHABILITATION PROJECTS

The condition of East Africa Northern and Central Corridors road network was
comprehensively assessed in 2010 to determine the level of deterioration of pavement.
HDM derived International Road Indices (IRI) were established for all roads, ranging
from 0 (good) to 20 (very poor).

Paved roads with roughness levels between 2 and 6 IRI were classified to be in
considerable sound state requiring no immediate remedial action, but with the
assumption that they will receive routine and periodic maintenance in time to maintain
conditions so as not to impact on productive capacity of the road.

Figure 7-4
Central Corridor Road Rehabilitation and Upgrading to Paved Projects by Type and Timing

Source: Aurecon, East African Transport Strategy and Regional Road Sector Development Program, 2010.
 129

Paved roads with roughness levels between IRI 6 and 10 were classified to be approaching
severe state or “warning state”, requiring rehabilitation within next 5 years. Paved roads
with roughness levels above 10 IRI were categorized as being in severe condition,
requiring immediate rehabilitation. Table 7-5 shows Central Corridor roads in the latter
two categories, with those in severe condition programmed for rehabilitation within the
following four years and those in warning condition planned for rehabilitation from 2014.

Table 7-5
Proposed Central Corridor Road Rehabilitation Projects
Invest. Cost
Start Dist. (US$ EIRR
Component Country Year (km.) million) (%)
Bubanza - Cyangugu/Bukavu Burundi 2011 77 32.3
31
Muyinga – Kanazi Burundi 2011 27 18.9
36
Kigali – Ruhengeri Rwanda 2014 98 41.2
28
Nyamahale – Kigali Rwanda 2014 154 64.7
20
Dar es Salaam and surroundings Tanzania 2014 28 19.6
36
Isaka and surroundings Tanzania 2014 29 20.3 22
Chalinze – Tanga (Coastal feeder) Tanzania 2014 170 71.4
72
Butare - Cyangugu/Bukavu Rwanda 2014 149 62.6
39
Total 732 331.0
Source: Prepared by Nathan Associates Inc.

There are already plans to rehabilitate some of roads listed below. However
implementation of the comprehensive program of road capacity upgrades as proposed
below needs to be pursued expeditiously in order to secure road conditions that will
facilitate smooth flow of growing traffic and trade along the corridors.

UPGRADING TO PAVED ROADS

Road assessments conducted by CDS/Nathan Inc, Aurecon and Louis Berger of the East
Africa road network has determined that 3,600 km of regional roads are gravel surface on
which vehicles operate with huge economic consequences (high cost and consequent lack
of facilitation of trade and thus economic growth). In order to reduce the high economic
cost there is need to upgrade them, especially those with relatively high traffic levels.
Among these are 774 km on the Central Corridor. Given the level of traffic on the
concerned roads, there is need to upgrade them in the medium to long term.
Consequently, Table 7-6 below lists roads of 774 km on the Central Corridor that are
recommended for upgrade to paved standard from 2014.

There are plans to upgrade some of roads listed below. However implementation of the
comprehensive program of road upgrades from gravel to paved standard as proposed
below needs to be pursued timely to mitigate the economic cost and unlocking further
economic opportunities.
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Table 7-6
Proposed Central Corridor Road Projects Upgrading to Paved Condition
Invest. Cost
Start Distance (US$ EIRR
Component Country Year (km) million) (%)
Mwanza and surroundings Tanzania 2014 14 11.8 32
Biharamulo and surroundings Tanzania 2014 67 46.9 23
Bujumbura – Gitega - Muyinga Burundi 2014 149 104.3 63
Nyakanazi – Biharamulo Tanzania 2014 72 50.4 21
Nzega – Isaka Tanzania 2014 55 38.5 43
Dodoma – Kalema (Dodoma feeder) Tanzania 2014 167 116.9 177
Iringa - Dodoma (Dodoma feeder) Tanzania 2014 182 127.4 75
Kalema - Arusha (Dodoma feeder) Tanzania 2014 68 47.6 115
Total 774 543.8
Source: Prepared by Nathan Associates Inc.

DEVELOP ROAD MAINTENANCE CONTRACTING SYSTEM FOR CENTRAL

CORRIDOR (TA)
The Central Corridor road network has in the last decade been significantly improved,
with the upgrading to paved standard of more than 500 km in Tanzania and rehabilitation
of another similar distance. An appropriate management needs to be established to ensure
adequate maintenance is provided on time. However, in the past management of the
paved and unpaved sections of the Central Corridor roads has been in cycles including
periods of good condition, after rehabilitation with support of development partners,
back to poor condition needing another round of rehabilitation. The main reason for
deterioration of the roads after periods of rehabilitation or upgrading has been mainly
deferred maintenance due to inadequate financing. Overloading has also been a factor,
causing accelerated deterioration of the roads.

As regards maintenance, the Governments in whose countries the core Central Corridor
road network traverses (Tanzania, Rwanda and Burundi), have established dedicated
Road Funds in order to ensure availability of finance to affect adequate and timely routine
and periodic maintenance. However, there are still gaps in funding due to large demand,
which compete for financing from the Road Funds. In respect of overloading, Tanzania
has adopted and is implementing a regional (SADC) strategy based on administrative
penalties that aim to recover the actual costs of road damage. There is general
appreciation of an effective enforcement in Tanzania although the time taken is high since
transit traffic vehicles have to be weighed at 9 weigh-stations in Tanzania, instead of the
ideal two, one at departure and another at exit. There are also complaints of officials
delaying the process and involvement with soliciting and receiving “unofficial”
payments.

In order to ensure that roads receive regular maintenance as required, a proposal has been
made that the core corridor roads be put under long term performance based contract.
The contract would include the requirement to keep the roads at an agreed level of
condition, including ensuring that roads are not damaged due to overloading. Financing
 131

of the contract will be from a combination of sources including road public funds (from
Road Fund/Government and, in some cases, possible tolling).

Roads are managed by Road Agencies/Authorities and maintained on contract for

specific works defined such as routine maintenance, re-sealing/periodic maintenance.
Finance is from Road funds and Government budget allocation. When there is no finance,
maintenance is postponed, thus accumulating deferred maintenance and accelerated road
deterioration. Long-term contracting has been adopted on a pilot basis for some gravel
roads in Tanzania. Overload control is managed by the Road Agency (TANROADS in
Tanzania) via weighbridges. Rwanda and Burundi are in the process of establishing
weighbridges at and similar vehicle overload control systems.

The project consists of (1) an assessment to identify technical, legal, institutional, finance
and methodological frameworks and approaches to implement long term contracts, as
well as to define possible packages/sections to be put under such contract; (2) Transaction
Advisory services to structure identified possible contracts, prepare RFPs and assist with
procurement of maintenance contractors.

Lake Ports
As shown in Table 7-7, three infrastructure projects are proposed for lake ports and
transport in the Northern and Central Corridors with a total cost of US$ 36 million.
Together these projects are expected to reduce price on lake segments of the Northern
Corridor by 4 percent, reduce time of lake transport by 4 percent and improve the
reliability of lake transport services by 14 percent.

Table 7-7
Proposed Lake Transport Projects
Estimated Impact on Lake
Cost Transport Performance (%)
(US$ EIRR
Price Cost Reliability
Name million) (%)
Lake Ports Rehabilitation, Dredging and Siltation 14 -2 -2 -8 34
Protection

Establish RORO services on Lakes Tanganyika 15 -1 -1 -5 28

and Victoria

Restructure Wagon Ferries to Carry MAFI trailers 7 0 0 -2 28

Total 36 -4 -4 - 14

Source: Prepared by Nathan Associates Inc.

A description of each of these proposed lake transport projects for the Northern and
Central Corridors is presented below.

LAKE PORTS REHABILITATION, DREDGING AND SILTATION PROTECTION

Inland waterways on Lake Tanganyika have historically played an important role in
proving least cost, most efficient and reliable means of transport for goods to/from
Burundi, Eastern DRC and western Tanzania, as an important component of an
 132

intermodal supply chain along the Central Corridor linking these countries to Dar es
Salaam port through Kigoma. Similarly inland waterways on Lake Victoria provided an
important link for the Central and Northern Corridor transport intermodal system links to
especially Uganda. In this way the Lake provided Uganda with an alternative access route
to the sea.

This importance has declined due mainly to backlog maintenance or lack of investments
in the ports and marine infrastructure. Insecurity on Lake Tanganyika and the decline in
performance of rail links to Kigoma, Mwanza and Kisumu has also denied the lake
services with traffic that would have motivated such investment. Many ports are severely
silted, with depths at berths reduced to around 3–4m. Port facilities have also
deteriorated. However, with better prospects of economic growth in the region, it is
important that these links are revived and strengthened. Investment in rehabilitating and
improving Lake ports infrastructure and shipping services will be beneficial to the region.

Since traffic is low and needs to develop, it is proposed that initially a relatively cheaper
tug and barge based roll on roll off (RoRo) system should be developed on both lakes to
provide necessary capacity until cargo traffic builds up to justify more expensive lift on
lift off system.

Dredging at some ports on Lake Tanganyika and Victoria has been done or is ongoing,
with own funding (TPA) and assistance from Belgium. There are two major initiatives one
each for the Lake Victoria and Lake Tanganyika that are ongoing and have established
comprehensive investment strategies. In this an investment conference for Lake Victoria
was held in Mwanza on mobilizing finance for implementation. The proposed project
will:

• Complete or initiate dredging of ports of especially Kigoma, Bujumbura,

Kalemie, Mwanza, Port Bell, and Kisumu to restore design depths of generally
around 6 m on approach to, in anchorage and along berths.

• Establish a watercourse management system to minimize soil erosion and

sedimentation at ports.

• Rehabilitate or establishing areas and ramps to accommodate vehicles (in

particular MAFI trailers and forklifts) involved with RoRo operations at ports.

The project will provide the potential to reduce transport/trade cost with the use of least
cost links for especially for Burundi, part of Eastern DRC and Uganda. It will also provide
viable alternative trade routes for countries using the lake services to avoid propensity to
exploit monopoly situations,

ESTABLISH RORO SERVICES ON LAKES TANGANYIKA AND VICTORIA

In the course of revival of inland waterway services on Lakes Tanganyika and Victoria to
service increasing volume of cargo, it has been proposed to initially adopt a tug and barge
based RoRo services. These would be quicker and relatively less costly to establish.
Typically a tug and barge system also requires about a third of the crew compared to a
self propelled vessel. Furthermore, barges can be built at low technology shipyards on the
 133

lakes, tugs can be bought and railed to the lakes, MAFI trailers can be assembled and
fabricated locally and fork- lifts can be bought from local franchises.

There are some private sector operated barges on both lakes. Barges can be built at
existing shipyards at some ports on both lakes, albeit with some slight improvement if
need be. The project will aim to mobilize private sector, especially those involved in
provision of lake services to buy into and establishing RoRo services and acquire barges
fabricated at local shipyards. Private lake transport service providers will also be
encouraged to purchase MAFI trailers fabricated locally and importation of tugs.

RESTRUCTURE WAGON FERRIES TO CARRY MAFI TRAILERS

Principal cargo transport services on Lake Victoria were designed as part of a railway
system, with wagon ferries carrying wagons across the Lake. Link spans were built at all
major ports Mwanza, Kemondo Bay and Musoma in Tanzania, Kisumu in Kenya and Jinja
and Port Bell in Uganda to facilitate rolling wagons on/off the ferries. When the railways
were performing well the wagon ferries had an important role to provide an important
transport link for both Northern and Central corridors. However, with the near collapse
of the railways in recent years the importance and use of wagon ferries declined and the
ferries got no proper maintenance.

Out of the five ferries commissioned between 1964 and 1979 only four are serviceable or
operational since the sinking of one (Ugandan) in 2005 after collision with a sister ferry.
Two (Tanzanian and Kenyan) are operational and the remaining two (Ugandan) are being
rehabilitated to be put back to service. This RoRo service is simple to operate and
available to use, though some facilities at ports need rehabilitation. However, there is
need to reduce the high cost of maintenance and operations of the ferries relative to their
carrying capacity. They now carry 19 wagons (38 TEU.

Figure 7-5
Wagon-Ferry Ramp at Port Bell
A 2009 analysis by Marine
Logistics Limited for the Central
Development Corridor determined
the possibility of the ferries
accommodating 62 TEU, an
additional 24 TEU on MAFI trailers
and on deck, without changing the
structure of the vessel. There is a
possibility to further improve this
capacity by adjusting the
superstructure to make the ferry more flexible, with ability to carry a full load of MAFI
trailers when there are wagons to ferry. In addition the MAFI trailers have a tare weight
of around 5 tons compared to 17 tons for the wagons. There are no known plans to
convert the wagon ferries. The project will include a technical feasibility analysis of the
conversion, especially related to stability and safety standards; and if conversion is found
 134

feasible, the project will provide support for carrying out the conversions at local
shipyards.

DEVELOP VESSEL MAINTENANCE CAPACITY ON LAKE TANGANYIKA (TA)

There are old vessel building and repair facilities (slipway/dry docks) at the ports of
Kigoma, Kalemie, and Bujumbura, with different capacities and technical capabilities.
However, there have been complaints by some vessel operators of inadequate of capacity.
In addition complaints have also been made on unfair treatment or discrimination by
some owners of these facilities. Furthermore, with the drive to redevelop Lake Services,
involving acquisition and deployment of newer vessels, as well as enhance safety
standards, there is need to develop adequate capacity to handle vessel building,
assembling and repairs. This capacity should also be developed and managed as common
user facilities to service vessels from all countries.

Each main port (Kigoma, Kalemie and Bujumbura) has some repair facilities managed by
respective Port Authorities. An assessment of these facilities is required to determine a
strategy for development adequate and integrated vessel repair facilities on the Lake. The
strategy should include an institutional framework to ensure access by vessels
irrespective of their country of origin and steps to promote and secure the interest of
potential investors and managers of the facilities.

ENHANCE SAFE NAVIGATION (TA)

The Lakes do not have up to date navigational aids to guide safe sailing of vessels. The
certification and licensing of vessels and crew is also not harmonized among the countries
allowing ship owners to operate a wide variety of vessels to different standards.
Furthermore, there is no credible and effective search and rescue on the Lakes. Given this
state there is no credible safety environment on the two Lakes. Partly due to this many
avoidable accidents happen and major accidents have resulted in huge losses. The most
dramatic accidents include the sinking 30 km off Mwanza port of MV Bukoba, a
passenger steamer with capacity of 430. This accident, which occurred in 1996 resulted in
the drowning of approximately 800 people. Rescuers were brought in from as far as South
Africa. The other major accident was the collision of two wagon ferries in 2005, resulting
with the drowning and loss of one of them. Enhancing safety regulations will create
conditions for avoiding some of these accidents and losses.

Safety issues are included in the two main initiatives for the two Lakes: the Lake Victoria
Basin Commission (LBVC) and Lake Tanganyika Basin Commission (LTBC) under which
comprehensive development and investment strategies are being pursued. Key aspects
include:

• Carry out hydrographic surveys and install lake-wise and port navigational
aids for safe passage of ships;

• Adopt recognized classification society rules regarding construction of

ships/vessels;

• Introduce meteorological navigational warnings and other services;

 135

• Establish search and rescue organization and adopt a harmonized

implementation policy and strategy, including the possible use of Global
Maritime Distress Safety System (GMDSS); and

• Harmonize port security, safety and environmental compliance strategies.

LEADERSHIP BY CCTTFA (TA)

Many of the infrastructure and facilitation improvements should be done on a corridor
basis. Improvement is a dynamic process driven by dialogue between public and private
sectors. The objective of CCTTFA is to insure effective operation of transport, logistics
and trade on the Central Corridor in the interest of all member countries. With this
mandate and public private partnership structure, CCTTFA is ideally suited to promote
the infrastructure, facilitation and legal and regulatory framework improvements
identified by the Corridor Diagnostic Study (CDS) to strengthen corridor infrastructure
and operations. The Secretariat has specialists on staff for infrastructure, facilitation and
trade who can monitor progress in achieving the Action Plan as part of their duties. It
also has some resources provided by members. Nevertheless, they need assistance to
develop a sustainable plan for advocacy and fostering stakeholder actions for CDS-
recommended improvements. This TA should be integrated with the other facilitation
TAs to build a sustainable way forward in terms of on-going corridor improvements.

CDS quantifies the time, price and reliability of corridor transport and logistics operations
and recommends investments to make the corridor perform better. CCTTFA is currently
finalizing staff appointments and developing its work plan. CDS identifies issues that
need to be addressed in the work plan and recommends actions. An observatory is just
being completed that will form a base line for measuring performance results and for
monitoring on an on-going basis. Under the East Africa Trade and Transport Facilitation
Project, CCTTFA has funding for a business plan study. The development of the business
plan and this TA should be coordinated so as to avoid duplication.

The assistance would consist of two parts, TA and workshop support. The TA would
assist in establishing a consultative public private process, based on observatory findings,
to set the work agenda and commit government agencies and private sector to
responsibility for specific tasks to motivate and monitor achievement of the CDS Action
Plan. The CCTTFA Board and Stakeholders Consultative Forum, which has equal public
– private membership, would lead the process for CCTTFA and create the link between
the Facilitation Agency and national government action. CDS is providing broad
visibility to a set of investments and operational support through its stakeholder process
and investor conference. Once initiated, progress toward agreed CDS outputs would be
assessed and redirected every six months. TA would fund special CDS meetings for the
first two years, and fund 50 percent for the third year as the mechanism is made
sustainable

This initiative will be successful if all the participating members agree to devote time to
specific tasks because they are committed to the goals. This TA is intended to encourage
active involvement from CCTTFA members to form task forces to make the activities
sustainable and to reduce the dependence on outside consultants. CCTTFA needs to set
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up their operational structure and mode of operation. This TA is designed to allow

CCTTFA to pilot the methodology on several priority issues identified by CDS and the
Board and to do so in a way that the model is sustainable. It will also depend on member
buy-in to be successful.
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8. Border Posts and Trade/

Transport Facilitation
Trade and transport facilitation is the process of reducing transaction costs and delays by
simplifying trade procedures and document flows, harmonizing cross border procedures,
modernizing customs and transport systems, promoting quality and safety standards and
improving logistics. According to one study, 25 percent of the delays on transport
corridors are a result of poor infrastructure, 75 percent are a result of poor facilitation.16
The Corridor Diagnostic Study is primarily concerned with infrastructure investments to
enhance the performance of the Central and Northern Corridors. But to achieve the full
benefits for these two corridors, it is essential that investment also be put into
accompanying facilitation measures. This section will highlight these measures. Profiles
of the TA projects for facilitation measures are contained in the Annex to this volume.

Border Post Investment Programs

Border posts in the region are generally in poor condition and serve as barriers on the
route. Table 8-1 lists the main borders on the Northern and Central Corridors and their
characteristics. It provides status in terms of improved procedures. As indicated in
Section 5, there are plans and funding for building new facilities at the key Corridor
borders. New facilities are needed that are designed for carrying out necessary controls
effectively with good flow of vehicles and persons. A border post improvement program
does not necessarily need to be introducing the One Stop Border concept. Nevertheless,
the East African Community has made a commitment to introducing One Stop Border
Post (OSBP) operations at all the regions borders.

16 Djankov, Simeon, Caroline Freund and Cong S. Pham, “Trading on Time”, January 26, 2006, p. 9.
 138

Table 8-1
Main Border Posts and their Characteristics
Daily HGV
Corridor and Border Posts Traffic per Processing CDS
Direction* Time Border Post Operations and Main Capacity Constraints Improvement Status Priority
NORTHERN CORRIDOR

Malaba border post is a one stop for the railway which now Rail OSBP implemented by
Mombasa - Kampala takes only 1-2 hours. For road only customs operates as a USAID.
Malaba one stop border post. This is a very busy border hampered Initial work on road facility
by a one way bridge and congestion. design and procedures done
200 26 hours High
by USAID. Funding of
facilities being undertaken
by World Bank and DfID.

Kampala - Kigali Mostly transit. Rwanda import clearances are not done at Recently switched to 24
Gatuna/Katuna the border. Vehicles are escorted to Kigali for clearance. Just hour operation. Preparation
introduced blue channel for compliant clients which takes for OSBP facilities (EATTFP-
3 hours -
90 half day. Otherwise 1-2 days including inspection. WB). Bilateral committee High
transit
Uganda import clearances can be done at the border or in formed.
Kampala.

Kigali - Bujumbura Traffic appears to be reduced as the Central Corridor civil Feasibility Study being done
Akinyaru-Kinyaru Haut 1 hour- works are completed and some traffic moves to the Central for OSBP (EATTFP – AfDB).
57 Medium
transit Corridor to Dar.

CENTRAL CORRIDOR

Clearances are not done at the border. Documents are Understand that TMEA
Dar es Salaam – Bujumbura collected at border and vehicles park in Bujumbura waiting plans an engineering design
Kobero/Kabanga clearance procedures at the port that can take 2-3 days. With study.
the establishment of the Burundi Revenue Authority, new
1 hour + 2-
50 procedures in development that will reduce times High
3 days
considerably – about 1 day. Introduced bond system at
border on 1 November 2010. Road improvements on route
also in preparation stage.

Dar es Salaam – Kigali Clearances are not done at the border. Vehicles are escorted JICA is in technical design
Rusumo to Kigali for clearance. Just introduced blue channel for and approval process for
2 hours+ .5
100 compliant clients which takes half day. Otherwise 1-2 days constructing a two lane High
to 2 days
including inspection. bridge and OSBP.
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Daily HGV
Corridor and Border Posts Traffic per Processing CDS
Direction* Time Border Post Operations and Main Capacity Constraints Improvement Status Priority
Dar es Salaam - Kampala Road construction just being completed so traffic is likely to Preparation for OSBP
Mutukula increase. OSBP being prepared. facilities (EATTFP-WB).
Procurement being done
1 hour + 1 separately, but coordinated Medium to
20
day through a bilateral High
committee so the overall (already in
development is coordinated. process)

CENTRAL AND NORTHERN CORRIDORS

It takes 30 minutes to clear from Rwanda. The truck is met Feasibility Study OSBP
Gisenyi-Goma at the DRC border and escorted to the customs clearance (EATTFP – AfDB).
0.5 to 1
20-30 area. Clearance can take more than a week as the Medium
hour
transporter/forwarder must clear with about 12 agencies.

RELATED BORDER POSTS

Border post is congested. Actually, holding trucks while Several ICP are involved in
Dar es Salaam to Copper Belt clearance is done on both sides and then allowing them to different aspects of the
proceed with a simple check at the gate. New facilities are project.
Nakonde-Tunduma 100 2-4 days being built for the conversion to an OSBP. Half completed in High
Zambia and planned in Tanzania, though customs building
relatively new and immigration building is new.

*Heavy goods vehicles (HGV) are defined as those carrying up to 48t to 56t GVM.
Source: Nathan Associates Inc.
 141

While new facilities are being built and procedures improved, it is logical to also move to
simplified border crossing in one stop border facilities. This generally entails moving exit
procedures to the country of entry in each direction of traffic17, building a single facility
that straddles the border18 or building a single facility all in one country19.

The vehicle stops once and both exit and entry procedures are carried out in one hall. An
OSBP facilitates information sharing among border agencies and allows inspections and
other procedures to be carried out jointly. Border officers continue to carry out national
law even when they are operating from the control zone in the adjoining state. A critical
element of the legal framework is to provide that authority and to define its use at the
border.

The introduction of OSBP is already in process at Malaba, Gatuna/Katuna, Rusumo and

Nemba and in the planning stage at other Northern and Central Corridor borders. The
issue is how to most effectively transition to this mode of operation and how to obtain the
greatest benefit from the introduction of OSBP.

Figure 8-1
Straddle OSBP at Nemba
The primary advantage of the OSBP to the
user is to stop only once to carry out all border
procedures. The advantage to the border
control agencies is greater information sharing
and cooperation on controls. The time for
passenger traffic is rapidly cut in half. For
cargo, a reduction to one half and less is linked
to use of risk management, preclearance and
prepayment, accredited economic operator
programs and similar measures which are now being introduced by some of the revenue
authorities.

IMPLEMENTING BORDER POST IMPROVEMENTS AND/OR OSBP

Experience at the region’s borders suggests that the following sequencing of activities
needs to take place.

1. Prioritize borders to be improved in terms of numbers of persons, volume of

cargo and length of delays at the border. It is important to determine those
where the greatest gain can be achieved from the investment. Section 5
recommends that the first priority for OSBP are Malaba, Gatuna/Katuna,
Nimule, Rusumo and Kobero/Kabanga. These are the busiest borders and the
most important to the transit regime on the two corridors.

17 Regional examples include Malaba, Gatuna/Katuna and Rusumo. This is the most commonly used
model.
18 The one regional example is Nemba. It requires open flat land at the border.
19 This type of OSBP is planned for Ruhwa, on the Rwanda – Burundi border. It is necessitated by the
topography where there is no suitable flat land on the Rwanda side.
 142

2. Mobilize the commitment of government agencies to the intervention and create

a Joint Corridor Steering Committee to guide the process for the Corridor as a
whole. In this way, it is more likely that common practices are developed for the
length of the Corridor. This will encourage common forms and electronic entry
and transmission for the length of the transit shipment.

3. Carry out a traffic survey to understand the demand in terms of types of traffic
using the border, current procedures and time to clear, number and organization
of officers, and trade projections for the route. This is critical to design the border
to meet current and projected trade needs and to create an environment in which
trade flourishes. The survey also provides a base line for setting performance
targets and monitoring results.

4. Implement a prefeasibility study that reviews procedures for all the border
agencies for relevance, good practice and ability to automate. Plan procedures
for the Corridor as a whole. This review should precede finalizing the border
design, so that the engineering and architectural designs take into account the
anticipated procedures.

5. Based on the capacity to automate, develop a plan for introduction of systems to

automate the transit regime from port to final destination. Determine investment
requirements and begin to develop the necessary systems whether through
adaptation of off-the-shelf software or through design and development of
systems. It is critical that this planning be done at the beginning of the
implementation as it generally takes more time to complete than anticipated.

6. Review the functional requirements of each Corridor border post and the
engineering design that best suits the physical location, procedures outline and
minimizing the impact of border controls on trade movement.

7. Based on agreement regarding the overall recommendations for the Corridor, a

work plan and timeline for implementation needs to be agreed. The
prefeasibility study provides the opportunity to review Corridor operations and
recommend the optimal system and then design the component parts based on
the objectives for the whole Corridor. The work plan and timeline needs to keep
the simplification and harmonization of procedures, ICT development and
physical design and construction moving ahead simultaneously with adequate
coordination among the three.

Borders are complicated places with many agencies each with their own mandate to
exercise specific controls. Improving performance of the border as a node in the transit
movement generally involves 5-10 agencies in each country that need to review their
operating procedures for achieving their legally mandated controls and determine if they
can be done differently to achieve the objective while at the same time facilitating rapid
transit of goods and persons. Secondly, these agencies need to determine how they can
coordinate their activities. In a One Stop Border operation, it is not only how national
agencies can coordinate for greater efficiency, but how agencies of two or more countries
can coordinate for joint controls.
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REGIONAL AND CORRIDOR INSTITUTIONAL ROLE IN IMPLEMENTATION

The East African Community forms the context for border improvement programs. The
East African Community is a Customs Union governed by the Customs Management Act
(CMA). There is an agreement to develop common regulations and procedures for the
Community as a whole. The regulations for the implementation of the CMA have been
completed and the detailed procedures are being developed by the five Partner States of
the EAC. Therefore there is both a commitment to simplification and harmonization and
a process for achieving it at a regional level. Most of the two corridors are located in EAC
countries. The challenge is to bring about a unified customs administrative and transit
system for the EAC and through agreement to extend it to DRC and other neighboring
countries.

Cross-cutting this regional effort is the agreements/commitment on which the Northern

Corridor Transit Transport Coordination Authority and the Central Corridor Transit
Transport Facilitation Agency are founded. These agreements commit Corridor countries
to provide land locked countries with right of access to the regional ports for trade
purposes. They commit them to engaging in actions that not only provide access, but
improve and maintain the performance of the transit corridors. Importantly also, both of
these agreement also include DRC.

Therefore there is a mechanism already in place to harmonize customs operations

throughout the region and the potential under the EAC umbrella to create a process for all
the agencies to engage in simplifying and harmonizing requirements and border
procedures. There are also entities on both corridors designed to seek effective transit
regimes on each corridor. The border post improvement program should build on these
ongoing efforts and institutional mechanisms.

OSBP IMPLEMENTATION
For successful implementation, it will be important to have task groups dedicated to
procedures, ICT and facilities. The legal framework for OSBP was developed and
approved up to the Multi-Sectoral Council of Ministers in 2010 and is being introduced to
the EAC Legislative Assembly during the first half of 2011. Work is almost complete, but
there should also be a member of the joint committee who takes responsibility for
insuring that the work of the other task groups conforms to the EAC OSBP draft Act.
 144

Figure 8-2
Rusumo Border Post
Task groups should be
formed at the national level
and merged periodically by
the Joint Corridor OSBP
Steering Committee to
insure that the programs
initiated are harmonized for
the Corridor as a whole. It
is very important that tasks
are defined, that specific
people are assigned responsibility for each task and that a specific delivery schedule in
agreed to by members. It is critical that the same people participate throughout, so that
there is continuity from one meeting to the next. The task groups are the link between the
national and regional level activities. The development of strong national level task
groups will enable the joint commissions envisioned in the draft EAC OSBP Act to be
formed with a strong nucleus of experience. Additional activities that fall in the latter
part of the implementation are approval procedures at the senior level of all the border
agencies involved, training for both public sector officers and the private sector and a
monitoring program once the OSBP is open. The monitoring should consist of assessment
of the implementation and coaching to insure that a good transition is made and to
address any unexpected issues that have developed. A TA is designed to provide
assistance to the task forces as they move through this process and to insure that the
corridor-wide and regional focus is also maintained.

TA for OSBP Implementation

CDS proposes technical assistance to the EAC Secretariat to assist in finalizing and
obtaining consensus on harmonized OSBP procedures for the EAC that incorporate
customs tools such as pre-clearance, risk management and accredited economic operators.
The TA includes funding for a series of workshops to arrive at consensus among Partner
States. CDS also proposed support for the development of a border post management
information system that incorporates some of the customs tools developed under the first
OSBP TA and the TA on Streamlining Customs Procedures. The component includes
support for software development, implementation, training and software updating.

Streamlining Customs Clearances at Border and Inland

As has been seen above, greater use of customs tools to insure revenue without
unnecessarily delaying trade and transport is critical to obtaining efficiency at the borders,
inland clearance centers and at the port where some of the longest delays occur. A
working group of Revenue Authorities is piloting new approaches and assisting with the
roll out to other EAC authorities. Since Uganda, Rwanda and Burundi use both the
Northern and the Central Corridors, it is important to harmonize the systems used for
both corridors. Burundi converted a government customs department to a Revenue
Authority in April 2010 and is making a series of changes in its clearance procedures. This
 145

is a good time to insure that the transition in Burundi is coordinated with development in
the other countries along the two Corridors. Further training and harmonization
throughout EAC is needed to achieve the full benefits.

Figure 8-3
Malaba Border Posts Transactions
Currently, Rwanda, Burundi and DRC
do not do clearances at the border and
Uganda gives clearing agents the
option of clearing at the border or
inland. As some countries move
clearance procedures to the borders,
such measures will become even more
important to insuring that revenue is
collected without unduly delaying trade. Uganda allows clearing and forwarding agents
to submit documents in advance and prepay duties based on their calculation, but
document review and duty assessment is done at the border or in Kampala at the
determination of the importer. Preclearance linked to prepayment is another tool to be
implemented in the partner countries. The World Customs Organization is supporting
this kind of initiatives and should be a resource to draw on for information and potential
support.

Many of the customs tools involve the electronic transmission of data and payments. The
success of this training and TA is dependent on the implementation of reliable
interconnectivity between borders and headquarters and among the countries. It also
requires reliable, inexpensive data connectivity for the private sector to customs and
between clearance points and the borders. The experience of Rwanda demonstrates that
where connectivity is available the private sector will incorporate it into its operations so
that they also enhance the operational efficiency. Success also depends on the continued
commitment of Revenue Authorities to modernize procedures and to see transit efficiency
as an important goal. EAC has mechanisms in place for harmonizing procedures
throughout the community and needs to use them for this effort. It is independent, but
related to OSBP implementation in that a primary objective of the OSBP is to achieve
simplified, harmonized procedures. If this initiative is completed, the main issue for the
OSBP implementation concerning procedures is how they can be carried out in the
neighboring country in the common control zone and what further efficiencies can be
obtained from operating in proximity and where possible, jointly.

TA for Streamlining Customs Clearances

TA includes a coordinated program of regional training/capacity building on customs
modernization tools followed by regional technical assistance on implementation at
national level and harmonization at regional level will result in more streamlined border
operations. The training and capacity building must involve the border control agencies
and the private sector. A second technical assistance effort is proposed to produce
harmonized regional guidelines and programs to support implemented at the national
level.
 146

Trade and Transport Facilitation

CDS presents a series of investments in the road sector to reduce the travel time and
vehicle operating costs. Nevertheless, time gained through road construction can easily
be erased by a proliferation of customs and police stops, both formal and informal, and
even over-frequent use of weighbridges to protect the roads. Several TA interventions
fare described in the sections below that are designed to create a regional harmonized
transit regime to realize the full trade benefits of the infrastructure investments.

REDUCE INFORMAL STOPS AND PAYMENTS ON CORRIDORS

Without sufficient law enforcement vehicles, stationary control points to check for driving
licenses, vehicle registration, vehicle road worthiness certificates and to inspect vehicles
for contraband and trafficking are essential. Nevertheless, unofficial stops delay transit
transport and add cost to transport which is passed on to the shipper. In other cases, they
are payments to avoid regulatory control, such as payments especially on the Northern
Corridor to avoid overloading controls. It will require a concerted effort by governments,
individual agencies and the road users to end this problem. Studies on the Northern
Corridor suggest a cost as high as US$900 per TEU is added by informal stops. Road
transporters on the Central Corridor report that the total cost is from US$50-100 per truck.

Figure 8-4
Police Stops on Corridor
It is essential that, as part of the
development of the overall transit
regimes, a commitment is made to
reducing the interruptions to the flow of
traffic and to moving them as much as
possible to the points of origin and
destination. Customs has periodic check
points on the corridors, often not in the
same place as the weighbridges. To
address the proliferation of official stops,
some road project loans require an
agreement by participating countries to limit this type of official stops to two per country.
Nevertheless, this has not necessarily been enforced. Efforts have been made by
organizations, such as the Private Sector Foundation and the East African Business
Council to monitor the situation and to lobby for better control over informal stops and
payment demands. These efforts need to be actively supported and expanded to reduce
this practice.

TA to Reduce Informal Stops and Payments on Corridors

CDS recommends a technical assistance program to work with police departments to set
up an internal monitoring unit and to design their own programs to control the number
and frequency of official stops and to eliminate other stops. A component of the program
should be training on integrity and the impact of the current situation on police credibility
 147

and trade. In addition, a public information program will be incorporated to discourage

payment of bribes and encourage reporting of officers requesting money. This program
should involve both presentations at appropriate meetings and a series of TV and radio
spots broadcast at high volume times and concentrated within a specific period.

The NCTTCA and CCTTFA should be involved in the effort to promote integrity on an
on-going basis and have some funds to begin a process of monitoring the roads for
compliance. One of their roles would be to work with agencies involved to maintain the
vigilance and incentives for mostly unimpeded transit on the highways. The TA would
fund setting up a program for long-term monitoring and stakeholder awareness by the
corridor groups that is sustainable.

LIBERALIZE TRANSIT REQUIREMENTS

Road transporters should be able to organize their business to maximize efficiency and
reduce costs. In the Corridor states, road transport regulation included carrier licensing
and safety regulation, periodic testing for vehicle road worthiness and driver ability.
Kenyan and Tanzanian road transporters carry most transit goods in the EAC. In 1995,
Kenya transferred the registration and licensing of vehicles to Kenya Revenue Authority.
EAC customs regulation requires that vehicles carrying goods in transit and/or under
customs control be licensed. In Kenya, vehicles licensed for transit cannot carry domestic
cargo and must use prescribed transit routes. This has the effect of many return trips
being empty. Similarly in Tanzania, the issuing of licenses for goods carrying vehicles was
abolished. Registration with SUMATRA requires proof of vehicle inspection, third party
insurance and registration with Tanzania Revenue Authority (TRA). Through these
systems, Kenya and Tanzania restrict road transporters use of their vehicles causing
transporters to incur the full cost of a round trip to make a one way delivery. Shippers are
often billed for a round trip when they only need to have goods hauled one way. The
current regulations need to be reviewed to find a means of avoiding diversion of goods
into the local market without unduly raising the cost of providing transport services.

Figure 8-5
Required Transit Goods Sign
The Tanzania Revenue Authority
has experimented with
permitting truckers to load
backhauls using transit vehicles
provided the truck follows the
prescribed transit route and
reports to TRA check points
along the route and to TRA at the
conclusion of the trip. While adding to the delays for domestic haulage, it enables the
vehicle to return loaded. This system could be tried in Kenya as well, or another system
identified. The implementation of the EAC Common Market Protocol, which began on
July 1, 2010, has the goal of liberalizing the transport market. In the Protocol, however,
Kenya reserved the right to restrict transport operators from other countries to establish a
 148

commercial presence in Kenya. Broader issues of market access need to be resolved in

EAC.

TA for Liberalizing Transit Requirements

It is recommended that the EAC facilitate discussion between public and private sector
stakeholders on phasing out licensing of transit vehicles and vehicles carrying goods
under customs control (possibly using TRA approach as starting point). From this
dialogue, options should be identified that improve transport efficiency and cost while
recognizing the revenue concerns of customs. The proposed option should be piloted on
the two corridors and refined based on the pilot. Once a system has been agreed among
the agencies involved, the regulations should be modified to accommodate the solution. A
system for monitoring impact should be part of the proposal.

Success will depend on the willingness of all parties to engage in a dialogue and
commitment to finding a workable solution. The pilot will need to be conducted in such a
way that it produces quantifiable results and the parameters for new transit regulations.
The resulting regulation should be linked to, but not dependent on, the implementation of
a regional transport licensing agreement.

IMPROVED VEHICLE OVERLOAD CONTROL SYSTEM

Art 90(l) of the EAC Treaty commits the partner states to: adopt common rules and
regulations governing the dimensions, technical requirements, gross weight and load per axle of
vehicles used in trunk roads within the Community. Under the guidance of the EAC
Secretariat and with donor support, partner states reached agreement in July 2008 on the
harmonization of axle mass loads, gross vehicle mass limits, the adoption of a formula for
the protection of bridges and tolerance factors for overloads (i.e. grace percentages which
do not attract penalties). Agreement was also reached to ban quadrem axles and to
decriminalize overloading by adopting a system of administrative penalties to recover the
economic cost of damage inflicted by overloaded vehicles.

Major investments have been and continue to be made in improving Northern Corridor
roads, in terms of rehabilitation mainly after accelerated deterioration due partly to
rampant overloading of vehicles. The Central Corridor roads have been significantly
improved, with the upgrading to paved standard of more than 500 km in Tanzania and
rehabilitation of another similar distance. Effective overload control is essential to extract
maximum economic benefit from this investment. Investment in railway systems is also
ongoing and the ability of rail to compete effectively with road transport also depends –
significantly - on effective measures to combat overloaded trucks and resultant lower than
economic road transport operation costs.

Despite the agreement reached in 2008, there has been little progress by Member States in
amending their legislation to adopt the harmonized regional standards. Moreover, only
Tanzania has introduced the agreed system of administrative penalties based on the
recovery of actual economic costs of road damage. Furthermore Rwanda and Burundi
have no existing weighbridges infrastructure and are in the process of establishing them
at the border points.
 149

The EAC is carrying out a study to review axle and load limits, which will guide an
overload control system in EAC. The study, financed by JICA, aims at harmonization of
axle load limits within the Tripartite (COMESA, EAC and SADC) region.

Existing overloading control strategy in Kenya, Uganda and Tanzania is aimed at

achieving one hundred percent inspection of all commercial vehicles. The frequency of
checks is also a concern. For example there are nine weigh-stations in Tanzania, nine in
Kenya, four in Uganda and transit vehicles have to be checked at all these points instead
of the ideal two, one at departure and another at exit. There is no targeted risk
management approach and no incentive to encourage truckers to self-regulate. The high
intensity of checking increases journey times and provides an added incentive for
corruption. Differences in national limits complicate cross-border operations.

TA for Improved Vehicle Overload Control System

Technical assistance is initially required to assist member states to align legislation on
vehicle limits with regional standards and to pass new regulations providing for
administrative penalties. All states need to revise legislation to adopt the regional limits,
although Tanzania has already adopted new rules providing for administrative penalties.

Experience elsewhere has highlighted that the efficacy of overload controls is improved
when the trucking industry is fully cognizant of the content of the new rules and their
application. Outreach activities to sensitize the trucking industry to the implications of
the new rules are useful to ensure smooth implementation of the administrative system
and to secure the co-operation of industry – from an early stage – to improve compliance
levels. At the same time, training of weighbridge staff and law enforcement officers in the
implementation of the new rules is also needed. Provision therefore needs to be made to
conduct workshops and information sessions with the trucking industry (once legislation
is finalized) and to hold practical training sessions with weighbridge personnel and
enforcement personnel.

In the longer term, technical assistance can be extended to develop a regional overloading
control strategy which utilizes targeted enforcement techniques based on risk
management. This includes focusing on specific vehicles and cargo types prone to
overloading, establishing databases to develop profiles of frequent offenders and
adopting additional enforcement measures to target high-risk truckers. Additionally,
measures to encourage self-regulation, such as the accreditation of compliant truckers
who qualify for more lenient treatment based on their compliance records, can be
introduced.

Co-operation by line function ministries and Attorney-Generals’ Chambers to process

legislation is a critical precondition for success. Without a legislative basis, the remaining
components of the technical assistance cannot be implemented.

MAXIMIZE EAC CUSTOMS UNION IMPLEMENTATION BENEFITS

The Customs Management Act (CMA) establishes the common external tariffs and
reduction formula for reduction of internal tariffs that is currently being implemented.
 150

Adoption of a regional external tariff collection system is one of the issues still being
determined. Since this system will have a considerable impact on the national transit
regulation administered by customs authorities, it will also have a direct impact on the
cost and efficiency of transport on the Northern and Central Corridors. Customs controls
include such restrictive measures as permitting vehicles for either domestic or transit
haulage, escorting, and frequent customs stops on major corridors. Therefore it is
important that the system take into consideration transport cost and efficiency.

The EAC Customs unit in the Secretariat is currently working on the tariff collection
system and seeking agreement of all member states. In meetings with national customs
authorities, it was evident that the national revenue authorities are not consulting with
transport agencies in developing transit regulations. It is the right time to provide insight
on the impact on transport charges, operational efficiency and vehicle utilization.

TA for Maximizing the EAC Customs Union Implementation Benefits for

Transport
Technical assistance is proposed to review the transport cost, time and reliability impact
of various proposals for full implementation of the Customs Union making use of analysis
of these factors in CDS. The purpose is to provide analysis and recommendations to the
EAC Secretariat and the national governments on the impact of each collection method on
transport efficiency and trade development within the Community as well as external
trade. The analysis will quantify the potential impact of transport and on trade growth.
The goal is for these impacts to be taken into account when the decision is taken by the
partner states on the collection system.

IMPLEMENT EFFECTIVE TRANSIT REGIME

To be competitive, a corridor should offer seamless movement to travelers, tourists,
vehicles and cargo. Transit needs to be seen as an integrated system of shared
information, effective guarantees, and a commitment to speed and service. It can best be
achieved on corridors, building to an EAC level system. It also requires cooperation
among government agencies such as customs, road authorities, police, etc.

Figure 8-6
Border Post Queuing at Malaba
There are many efforts to streamline
and harmonize transit regulations
within the East African Community,
but many of them have not been
implemented. Some have not been
agreed at regional level, some have
been agreed at regional level and
not domesticated in national law
and some have been domesticated
 151

and still not implemented.20 Failure to implement impedes transit movement in terms of
cost, time and reliability. Many aspects of a transit regime exist, but have not been fully
implemented. Common vehicle regulations have been issued, but not fully implemented
and there are current efforts to change again. Roadworthiness standards have been
promoted, but there is lack of trust in the systems of other EAC Partner States. Customs
declarations have been simplified and harmonized, but each country still requires its own
form under national insignia. While they can be filed electronically, they cannot be
modified and most countries still require the hard copy as the legal copy. RADDEx and
the common customs bond have been partially implemented in EAC. There is need for a
more coordinated, pro-active program of implementing a single, harmonized system.

The transit regime can most easily be implemented on corridors where the impact of
failure to act is immediately felt. Customs items will be affected by the fuller
implementation of the Customs Union. It is assumed that the measures recommended
here are important to the current transit regime and will be modified or eliminated
according to decisions taken on the external tariff collection system and phase out of
internal tariffs.

TA for Implementing an Effective Transit Regime

Technical assistance is proposed to assess the various components of transit system and to
determine where interventions are required and recommend a work plan for
implementation. The TA will include a discussion of the objectives and framework for the
transit system to emerge from the study. The TA will be carried out in coordination with
NCTTCA and CCTTFA so that it supplements their initiatives and is monitored by them
for sustainability. It would also be coordinated with EAC so that all measures aim toward
the development of a community-wide system. EAC would determine continuity with
broader Tripartite goals and initiatives.

After the initial assessment and recommendations, the TA would be an intermittent

activity to provide technical assistance as needed to national and EAC specialists as they
work toward implementation. It will incorporate a reporting and oversight mechanism to
insure that initiatives continue to move forward and that the result is a coordinated
system.

The transit regime will include, but not be restricted to:

• Implementation of harmonized vehicle weight and dimension standards and

enforcement with a goal of weighing only at port, border (s) and destination.

20 Key elements include: (1) common vehicle dimensions need to be agreed and enforced. Otherwise
drivers are restricted to the lowest dimension or weight. (2) joint recognition for road worthiness testing
and certificates so that insurance such as the yellow card can be effectively employed. (3) Application of
a single administrative document by customs on both corridors (entered electronically once, downloaded
and modified as needed by each country). (4) full implementation of RADDEx for vehicle and cargo
tracking on both corridors and immediate acquittal of customs bonds when goods cross the border. (5)
agreement on full sharing of information on the corridor. Implementing an effective transit regime is
done issue by issue, but also requires an overall vision and monitoring to achieve a coordinated
outcome.
 152

• Recognition of road worthiness testing and certificates by all authorities and

insurance agencies. Assistance to programs that are weak, either in testing
capacity or enforcement.

• Single customs document produced once with a copy for all customs agencies
and copy retained by driver with stamps from all customs agencies. Conversion
to and regional recognition of electronic entries, verification and release.

• Full implementation of RADDEx in all Corridor countries to allow effective

tracking. Application of tracking systems for customs, vehicle agencies, and
forwarders/shippers using RADDEx.

• Common customs bond administered on each corridor and later adopted in the
region. Immediate acquittals of bond at conclusion of journey.

• Agreement for full sharing of information on the corridor.

Policies and Agreements

Policies and agreements keep the Partner States cooperating to achieve a seamless
regional system despite the boundaries. Some agreements have been signed, but not yet
implemented. In other cases, policies haven’t yet been developed or formally approved.
This issue is fully developed in Working Paper D. Regulatory Framework and Transport
Policy. Several TA have been designed to fill the policy gap and to secure
implementation of policy that has been approved and passed.

INTEGRATION OF NATIONAL AND REGIONAL TRANSPORT POLICIES

The partner states of the EAC are committed to developing a Common Transport Policy
as part of their obligations under the Treaty (Article 89). The themes and thrusts of the
proposed Common Policy, as elaborated in the Treaty, cover all critical infrastructural,
operational and regulatory components needed to progressively improve the
performance of the two corridors.

Work on the development of the Common Policy is still sporadic and fragmented.
Progress with the development of common regulatory frameworks is most advanced in
road transport and to a lesser extent, inland waterways21. Yet, while states have reached
agreement on principles, this consensus has not yet resulted in operational improvements.
Progress has been stymied by a lack of concrete implementation. This has several causes.
Domestic legislation required to implement regional agreements has not yet been
adopted. More significantly, transport policy in all states is still overwhelmingly skewed
towards national priorities. While these policies acknowledge the regional dimension,
they do not elaborate specific programs or initiatives aimed at implementation of regional
instruments. Lastly, capacity to develop and implement policies is constrained in all
states. Inevitably, this results in a reactive approach to policy implementation.

21 With the adoption of the Tripartite Agreement on Road Transport in 2001 and the Tripartite Agreement
on Inland Waterway Transport in 2002.
 153

A common problem is that policy development tends to take too long. This means that
events sometimes overtake polices as they are being formulated. This undermines the
relevance of specific policies and results in policies never being approved. A second
challenge is to improve capacity to undertake policy monitoring and review. Policy-
making is a continuous process. Once adopted, a policy can become outdated fairly
quickly. Remedying these deficiencies cannot be achieved overnight. Various strategic
interventions are needed to create and sustain policy frameworks that will deliver
improved corridor performance. Such interventions are needed both regionally and
nationally. At the same time, strategies must be coordinated to ensure that regional and
national interventions remain in step and mutually support the overall objective of
improved corridor performance.

TA to Integrate National and Regional Transport Policies

The Partner States need technical and capacity assistance at the national level to align
national policies more closely to ensure that states are truly pursuing complementary
objectives. The objective is for national policies to (a) clearly identify the regional
commitments that governments have assumed, (b) determine national measures required
to implement regional decisions and (c) set definitive timelines for implementation.

In parallel with national policy harmonization, the TA needs to provide assistance in

preparing a Common Transport Policy as set out in Art 89 of the EAC Treaty. This is a
longer term objective, but one which can be approached in a phased manner, preferably
starting with road transport as the dominant mode. The aim must be to develop a
common vision for the regional transport sector, backed by harmonized policy goals and
programs giving effect to existing regional instruments such as the Common Market
Protocol and the Tripartite Agreements on Road Transport and Inland Waterways.
Additional instruments will need to be adopted to formalize the Common Policy. A
Protocol which captures the main policy goals and details the implementation measures is
likely to be needed. Operational details could be elaborated by way of an EAC Road
Traffic and Transport Act (or Acts) adopted by the EAC Legislative Assembly. This may
be followed by other Acts governing other transport modes.

Thirdly, the capacity of the EAC Secretariat must be strengthened with the appointment
of a full-time policy advisor. The role of the policy advisor will be coordinate the
development of a common policy, to assist national governments in aligning national
policies with regional objective and to monitor policy implementation on behalf of the
Sectoral Council. Similarly investment in capacity is needed in all member states.

HARMONIZE ROAD TRANSPORT POLICY

The EAC treaty commits Partner States to implementing a common road transport policy
(Art 90). The EAC States have partially given effect to this commitment by concluding the
Tripartite Agreement on Road Transport in 2001. The Tripartite Agreement provides a
common framework for regulating cross-border road transport and introduces a variety
of facilitation measures to improve operational efficiencies. To date, the Tripartite
Agreement has not yet been implemented, mainly due to the absence of enabling
 154

domestic laws. Moreover, states are still individually pursuing national policies with
objectives which are at times in conflict with their commitments under the Treaty.22

Domestic road transport policies in all states are aimed at deregulated market access,
which has had some positive effects, but the lack of qualitative regulation has also had
several undesirable consequences. These include low entry barriers leading to cut throat
competition, low safety levels and poor service quality. Operational standards need to be
improved and governments need to align their policies to encourage the growth of a
professional transport industry which is able to compete effectively within a framework
of clearly-defined rules and appropriate regulation.

TA for Harmonizing the Road Transport Policy

We propose that short term assistance be provided to support EAC states to implement
the Tripartite Agreement. This is required to:

• Revise existing legislation and adopt new legislation to domesticate the

Agreement in the national laws of the member states;

• Design licence application, adjudication and issuing procedures and forms;

• Design license administration software systems and procure hardware;

• Train personnel in the handling of applications, adjudication and issuing;

• Train law enforcers in the application of on-the-road enforcement of the rules

under the Agreement;

• Develop transport supply and demand capacity to manage competition between

carriers from different states; and

• Undertake monitoring and evaluation.

Medium term assistance will help EAC states align their road transport policies and
implement complementary regulatory policies for national and international transport.
Such policies and regulations must be aimed at developing a professional road transport
industry characterized by a progressive improvement in quality and safety standards.
Technical assistance is required to:

• Design the features of the policy/ regulatory system through a process of

stakeholder consultation;

22 These commitments include harmonising the provisions of their laws on traffic and
licensing, establishing common measures for the facilitation of road transit traffic, adopting
common and simplified procedures for road transport documentation and harmonising road
transit charges, reducing and eliminating non-physical barriers to road transport, ensuring
that common carriers from other Partner States have the same opportunities and facilities as
common carriers in their territories in the undertaking of transport operations within the
Community; ensuring that the treatment of motor transport operators engaged in transport
within the Community from other Partner States is not less favourable than that accorded to
the operators of similar transport from their own territories and making road transport
efficient and cost effective by promoting competition and introducing regulatory framework
to facilitate the road haulage industry operations.
 155

• Develop an appropriate institutional framework;

• Draft an EAC Road Transport and Traffic Act and implementing regulations;

• Define standards for access to the road transport profession;

• Develop procedures for evaluating applicants and issuing operator licenses;

• Design support software and procure hardware to operate a multi-module

database;

• Conduct training of regulatory and law enforcement personnel; and

• Undertake monitoring and evaluation.

Due to the multilateral nature of the Tripartite Agreement, successful implementation

depends on comparable levels of commitment from all Partner States. Similarly, national
measures need to be coordinated to ensure that progress is synchronized in all states to
ensure concurrent implementation. Multilateral arrangements similar to the Tripartite
Agreement have delivered proven benefits elsewhere (e.g. Southern Africa) in terms of
improved transport efficiencies and competition, reduced costs, etc. Similar benefits can
be expected to be derived from implementation of the Agreement in East Africa.
 157

9. Funding Requirements and

Impact Assessment
In this section we present a summary of the proposed infrastructure and operational
projects their funding requirements and the impact that implementation of the proposed
projects would have on corridor performance.

Funding Requirements
The 28 transport infrastructure projects that have been proposed for consideration in the
Action Plan are presented by mode in Table 9-1. These projects, which are to be
implemented within the next five years, have a total cost of US$ 4.2 billion23. It is
anticipated that 22 of the 28 projects could be implemented under a PPP arrangement
with varying degrees of private sector participation. Of the 28 infrastructure projects, 14
projects are in the Central Corridor and have a total cost of US$ 2.1 billion. There are 14
proposed projects for the Northern Corridor with a total cost of US$ 2.1 billion.

There are nine proposed infrastructure projects for the rail sector with a total capital cost
of US$ 1.3 billion. Eight of the proposed rail infrastructure projects are suitable for PPP
financing. The one that is not is the short-term revival of TRL that is anticipated to require
public sector and donor financing in the next two years. After that, proposed investments
for TRL could be provided under a PPP arrangement.

The six proposed road infrastructure projects have a total capital cost of US$1.7 billion of
which US$0.9 billion are for the Central Corridor and US$0.8 billion for the Northern
Corridor. Except for a few specific road segments in urban areas or on the Corridor trunk
roads with the highest traffic, these projects are not considered as likely candidates for
PPP financing.

23 This level of investment in transport infrastructure over a5-year period is within the level of funding
that can reasonably be generated. For example, according to the Infrastructure Consortium for Africa
(ICA) 2009 Annual Report, funding commitments for the transport sector in East Africa increased to US$
2.1 billion in 2009 from the level of US$ 1.2 billion that had been reported annually for 2006-2008. In
ICA’s report, East Africa includes Sudan, Eritrea, Djibouti, Ethiopia, Somalia and Seychelles but excludes
Burundi and Rwanda.
 158

Table 9-1
Proposed Infrastructure Projects by Mode
Cost Estimated Impact on Peformance
Name (US$ Corr. EIRR PPP
mil.) Price Time Reliability (%) Potential
Port Projects
Mombasa Short-term Container Handling Capacity
Enhancement with ICDs 35.0 NC -4 -13 -23 165 Yes
Dar es Salaam Short-term Container Handling 26.0
Capacity Enhancement with ICDs CC -2 -16 -7 226 Yes
Mombasa New Container Terminal – Kipevu West 342.5 NC -3 -11 -23 37 Yes
Dar es Salaam Container Terminal (Berth 13 &14) 500.0 CC -1 -15 -7 35 Yes
Mombasa New Petroleum Facility 55.8 NC -5 -12 -13 35 Yes
Mombasa Dry Bulk and General Cargo Facilities 1.7 NC -3 -6 -10 25 Yes
Dar es Salaam Dry Bulk and Break Bulk Facilities 5.0 CC -2 -5 -8 25 Yes
Dar es Salaam Single Point Mooring 68.5 CC -5 -12 -13 35 Yes
Lamu Corridor New Port and Associated Infrastructure
7.0 NC n.a. n.a. n.a. 30 Yes
Subtotal 1,041.5

Rail Projects
TRL Revival Infrastructure, Rolling Stock and Working
Capital and Isaka ICD 185.0 CC -15 -11 -19 38 No
TRL Track Infrastructure Upgrade 3-5 years 350.0 CC -4 -3 -5 27 Yes
RVR Infrastructure Upgrade 1 - 3 years 250.0 NC -2 -6 -9 22 Yes
RVR Locomotive Rehabilitation -3 years 20.0 NC -4 -11 -15 22 Yes
RVR Infrastructure Upgrade 3 - 5 years 150.0 NC -2 -5 -6 22 Yes
RVR Mombasa Intermodal Yard and Equipment 20.0 NC -1 -2 -3 26 Yes
RVR Kampala ICD Development 10.0 NC -1 -2 -3 21 Yes
Reconstruction of Tororo-Gulu- Pachwach Railway 325.0 NC n.a. n.a. n.a. 24 Yes
Dar es Salaam CFS Site Selection Design and Project
Preparation (Kisarawe) 2.0 CC -1 -1 -1 n.a. Yes
Subtotal 1,312.0

Road Projects
Central Corridor Capacity Upgrades 61.7 CC -1 -2 -2 n.a. No
Central Corridor Road Rehabilitation 331.0 CC -2 -3 -1 n.a. No
Central Corridor Upgrade to Paved 543.8 CC -3 -6 -1 n.a. No
Northern Corridor Capacity Upgrades 234.5 NC -2 -3 -6 n.a. No
Northern Corridor Road Rehabilitation 362.9 NC -10 -8 -7 n.a. No
Northern Corridor Upgrade to Paved 143.7 NC -5 -7 -3 n.a. No
Subtotal 1,677.6

Lake Transport Projects

Lake Ports Rehabilitation, Dredging and Siltation
Protection 14.0 CC -2 -2 -8 34 No
Provision of RoRo Services on Lakes Tanganyika and 15.4
Victoria CC -1 -1 -5 28 Yes
Restructuring Wagon Ferries to Carry MAFI Trailers 7.0 CC -1 -1 -2 28 Yes
Subtotal 36.4

Transit Facilitation Projects

Design and Construction of One Stop Border Posts 110.0 Both -1 -1 -1 22 Yes

Total All Infrastructure Projects 4,177.5

Source: Prepared by Nathan Associates Inc.

There are nine port infrastructure project proposed with a total investment of US$ 1.0
billion. Two of the projects, the new container terminals in Dar es Salaam and Mombasa
account for 80 percent of the proposed port sector investment. With the exception of
several small dry bulk projects, all of the proposed port infrastructure improvements can
be financed with a high-level of private sector participation.

For transit facilitation, there is one aggregated OSBP design and construction project
covering 11 border posts (US$ 110 million). These are being implemented mostly with
donor support.
 159

The three infrastructure projects proposed for lake transport have a total investment of
US$ 36 million. It is envisioned that the dredging and port rehabilitation project will
require public and donor financing while the provision of RoRo services and
restructuring of wagon ferries can be completed with private sector funding.

Proposed operational projects are presented by sector in Table 9-2. The 19 proposed
projects have a total cost of US$ 23.2 million of all which would require public sector or
donor funding. Nine of the projects are categorized as transit facilitation interventions,
whereas the road sector has three operational projects. The rail and lake transport and
ports sector each have two operational projects proposed.

Table 9-2
Proposed Operations Projects by Sector
Cost
Name (US$
Sector mil.)
Develop Northern Corridor Road Maintenance Contracting System Road 1.0
Develop Central Corridor Road Maintenance Contracting System Road 1.0
Improved Vehicle Overload Control System Road 1.8
Procure and Retain TRL Management Team Rail 2.0
Establish a Regional Railway Safety Regulator Rail 0.4
Develop Vessel Maintenance Capacity on Lake Tanganyika Lake 2.0
Enhance Safe Navigation Lake 3.0
Enhancing Mombasa Port Operations with ICT Applications Ports 2.5
Enhancing Dar es Salaam Port Operations with ICT Applications Ports 2.5
Liberalize Transit Requirements Transit 0.4
Maximize Customs Union Implementation Benefits Transit 0.3
Streamline Customs Clearances Transit 0.9
OSBP Implementation Transit 1.5
Reduce Stops and Informal Payments on Corridors Transit 0.9
Implement an Effective Transit Regime Transit 0.9
Integration of National &Regional Transport Policies Transit 1.1
Leadership by NCTTCA Transit 0.3
Leadership by CCTTFA Transit 0.3
EAC PPP Diagnostic and Institutional Building Study Transit 0.4
Total All Operations Projects 23.2
Source: Prepared by Nathan Associates Inc.

Impact of Proposed Projects

The implementation of the proposed Action Plan projects will have a substantial impact
on the performance of the Northern Corridor and Central Corridors. The improvement in
performance is presented in this section in terms of price, time and reliability for light
container imports and exports which are considered indicative of the performance
experienced by other cargo types.

NORTHERN CORRIDOR
 160

Table 9-3 presents the estimated improvement in Northern Corridor performance to

selected destinations of light container imports. Generally, the price to serve Northern
Corridor destination by road decrease by 25 percent and those destination served by rail
by 11-14 percent. In terms of time, the destinations served by rail enjoy an average
reduction of 53 percent in shipment time, while destinations served by road have a
reduction in time ranging from 21-33 percent.

Table 9-3
Improvement in Northern Corridor Performance for Imports with Proposed Action Plan Projects,
2015 (light containers)
Containers (TEU)
Distance
Destination Price (US$) Time (hours) Reliability Indicator (%)
(km.)
2010 2015 Var. % 2010 2015 Var. % 2010 2015 Var. %
Kampala (road) 1,180 2,099 1,563 -26 323 216 -33 194 61 -69
Kigali (road) 1,661 3,901 2,918 -25 376 262 -30 167 53 -68
Bujumbura (road) 1,903 4,950 3,820 -23 411 297 -28 153 50 -67
Nimule (road) 1,526 5,383 4,276 -21 381 280 -27 165 52 -68
Kasindi (road) 1,623 4,825 3,671 -24 372 259 -30 168 51 -70
Goma (road) 1,811 4,822 3,634 -25 537 422 -21 131 83 -37
Nairobi (road) 480 1,396 1,139 -18 396 308 -22 158 45 -72
Kampala (rail) 1,200 2,059 1,828 -11 462 198 -57 138 65 -53
Nairobi (rail) 489 935 801 -14 316 164 -48 202 77 -62
Port Node*
Mombasa 297 227 -24 217 133 -39 287 94 -67
Note: Port values are included in the total shown for each destination.
Source: Nathan Associates Inc.

The proposed road projects are concentrated on the Northern Corridor (and not on its
feeder roads) and are expected to reduce significantly price and time as well as the
variation in time (reliability). The higher savings on road transport are due to the
implementation of projects that increase the road capacity and rehabilitate the road
surface which reduce congestion and vehicle operating costs.

The proposed rail rehabilitation projects, as indicated by RVR representatives, are

expected to mainly have an impact on time and its variation. The projects are expected to
concentrate in the reduction of derailments (improve safety) and improve reliability of
locomotives. The impact of port improvements on road and rail alternatives is also
important, although its impact is greater when considering the time due to its larger share
of it (with port accounting for about 70 percent of the total time).

The proposed port projects (integrated ICDs, new port terminal, etc.) are expected to
reduce the port costs by 24 percent and more importantly reduce port time by 39 percent.
The proposed projects have an even greater impact on reliability with gains in reliability
of more than 60 percent. This significant improvement in the overall reliability of the
road and rail transport is the result of the reduction in variations of time caused by
congestion and potential accidents on the road and the improvement of rail operations
and reductions in the number of derailments and locomotive breakdowns.

Table 9-4 presents the improvement in performance for Northern Corridor exports of light
containers. The changes in terms of reduction in price are similar to those described above
 161

for imports. In terms of time, the percent reduction for exports is slightly higher than
those estimated for imports. Gains in reliability are substantial and average around a 62
percent improvement in reliability.

Table 9-4
Improvement in Northern Corridor Performance for Exports with Proposed Action Plan Projects,
2015 (light containers)
Containers (TEU)
Distance
Origin Price (US$) Time (hours) Reliability Indicator (%)
(km.)
2010 2015 Var. % 2010 2015 Var. % 2010 2015 Var. %
Kampala (road) 1,180 2,062 1,535 -26 395 255 -35 267 94 -65
Kigali (road) 1,661 3,864 2,890 -25 422 273 -35 250 87 -65
Bujumbura (road) 1,903 4,913 3,792 -23 433 285 -34 244 84 -66
Nimule (road) 1,526 5,346 4,248 -21 431 297 -31 245 82 -67
Kasindi (road) 1,623 5,491 4,003 -27 436 290 -33 242 82 -66
Goma (road) 1,811 4,785 3,606 -25 429 281 -34 246 85 -65
Nairobi (road) 480 971 720 -26 324 203 -37 326 117 -64
Kampala (rail) 1,200 2,022 1,801 -11 558 260 -53 191 92 -52
Nairobi (rail) 489 890 767 -14 412 227 -45 258 105 -59
Port Node*
Mombasa 260 199 -23 313 196 -37 336 121 -64
Note: Port values are included in the total shown for each origin.
Source: Nathan Associates Inc.

CENTRAL CORRIDOR
Table 9-5 presents the estimated improvement in Central Corridor performance to
selected destinations of light container imports. The reduction in price for destinations
served by road are generally between 9-11 percent, while destinations served by rail or
rail/ lake are estimated to have reduction in price between 30-36 percent. The percent
reduction in time is generally in the range of 40-50 percent.

Table 9-5
Improvement in Central Corridor Performance for Imports with Proposed Action Plan Projects,
2015 (light containers)
Containers (TEU)
Distance
Destination Price (US$) Time (hours) Reliability Indicator (%)
(km.)
2010 2015 Var. % 2010 2015 Var. % 2010 2015 Var. %
Mwanza (via road) 1129 1,618 1,446 -11 362 190 -48 198 163 -18
Goma (via road) 1640 3,618 3,291 -9 565 350 -38 135 106 -21
Kigali (via road) 1495 3,314 2,980 -10 420 233 -44 171 134 -22
Bujumbura (via road) 1567 4,369 3,964 -9 440 253 -43 163 123 -25
Kampala (via rail/lake) 1,568 2,507 1,750 -30 530 312 -41 150 85 -43
Mwanza (via rail) 1,229 1,794 1,150 -36 411 195 -53 192 126 -34
Bujumbura (via rail/lake 1,446 2,403 1,654 -31 524 304 -42 152 88 -42
Port Node*
Dar Es Salaam 319 199 -38 291 125 -57 245 193 -21
Note: Port values are included in the total shown for each destination.
Source: Nathan Associates Inc.

The proposed road projects on the Central Corridor are distributed between the main
corridor and its feeder roads and are expected to have a modest impact on price, time and
variation in time (reliability), mainly because the main spine of the network is relatively
new, having been upgraded or improved in recent years. The savings on road transport
 162

are due to the implementation of projects that increase the road capacity and rehabilitate
the road surface which reduce congestion and vehicle operating costs.

The proposed rail rehabilitation projects for TRL are expected to mainly have an impact
on time and its variation. The projects are expected to concentrate in the reduction of
derailments (improve safety) and improve reliability of locomotives, as is being done by
RVR on the Northern Corridor.

The impact of port improvements on road and rail alternatives is also important, although
its impact is greater when considering the time due to its larger share of it (with port
accounting for about 70 percent of the total time). The proposed port projects (integrated
ICDs, new port terminal, etc.) are expected to reduce the port costs by 38 percent and
more importantly reduce port time by 57 percent.

Table 9-6 presents the improvement in performance for Central Corridor exports of light
containers. The changes in terms of reduction in price are similar to those described above
for imports.

Table 9-6
Improvement in Central Corridor Performance for Exports with Proposed Action Plan Projects,
2015 (light containers)
Containers (TEU)
Distance
Origin Price (US$) Time (hours) Reliability Indicator (%)
(km.)
2010 2015 Var. % 2010 2015 Var. % 2010 2015 Var. %
Mwanza (via road) 1129 1,618 1,446 -11 396 207 -48 283 238 -16
Goma (via road) 1640 3,618 3,292 -9 599 367 -39 200 163 -19
Kigali (via road) 1495 3,314 2,981 -10 454 250 -45 248 198 -20
Bujumbura (via road) 1567 4,369 3,965 -9 480 275 -43 234 180 -23
Kampala (via rail/lake) 1,568 2,507 1,751 -30 638 331 -48 220 113 -49
Mwanza (via rail) 1,229 1,794 1,150 -36 517 212 -59 271 169 -38
Bujumbura (via rail/lake 1,446 2,403 1,833 -24 633 324 -49 222 115 -48
Port Node*
Dar Es Salaam (rail) 319 199 -38 397 143 -64 351 251 -28
Dar Es Salaam 319 199 -38 325 143 -56 326 256 -21
Note: Port values are included in the total shown for each origin.
Source: Nathan Associates Inc.

OVERALL TRANSPORT COST SAVINGS

The total impact of the proposed improvements on the performance of the Northern and
Central Corridors in terms of reduced transport costs is shown in Table 9-7. Overall,
annual transport cost savings by 2015 are estimated at US$ 1.9 billion, corresponding to
an average reduction in transport costs of 28 percent. Due to the larger volumes and
longer average distances, the Northern Corridor accounts for about three-quarters of the
total transport cost savings with cost reduction of US$ 1.4 billion. The Central Corridor
has annual transport cost savings of US$ 0.4 billion by 2015.
 163

Table 9-7
Annual Transport Cost Savings from Proposed Corridor Improvement Projects, 2015

Item Northern Central Total

Traffic (mt) 35.3 17.3 52.6

Transport cost under Status Quo (US$ million) 5,295.0 1,339.2 6,634.2
Transport costs with proposed improvements (US$ million) 3,874.0 908.56 4,782.6

Transport cost savings (US$ million) 1,421.0 430.7 1,851.7

Percent reduction 26.8% 32.2% 27.9%
Transport cost savings per ton (US$) 40.25 24.90 35.20
.
Source: Nathan Associates Inc.

In terms of percent reduction in transport costs, the savings on the Central Corridor
represent a reduction of 32 percent as compared to a reduction of 27 percent for the
Northern Corridor24. On a per ton basis, the average reduction is US$ 40.25 per ton on the
Northern Corridor and US$ 24.90 per ton on the Central Corridor.

IMPACT ON TRADE FLOWS

Trade flows are expected to increase even without a significant improvement in corridor
performance, but could increase substantially with performance improvements as noted
in above. These increases are related to the percentage decreases in price, transit time, and
variation in transit time (unreliability) for each trade flow. The elasticity indicating the
relationship between traffic and generalized cost was calculated using a gravity model. In
this model, the total trade between pairs of trading partners is a function of the economic
size of each country (GDP and population) and the disutility of shipping freight between
them.25 The results of the model indicate that the generalized cost has significant adverse
effects on trade flows analyzed regionally (within East Africa) as well as with overseas
partners.

The results shown in Table 9-8 for 2015 indicate an average potential increase in trade of
15 percent. The total potential trade increase 9.2 million tons is significant on top of the
already substantial traffic growth forecasted for the Base Case. Thus total Northern and
Central Corridor traffic would be 61.9 million tons by 2015. The largest potential increase
in trade is shown for the Central Corridor with transit traffic increasing by 38 percent.

24 These levels of cost savings are even more impressive if one considers that fuel costs typically represent
about 35-40 percent of vehicle operating costs in the region and the amount of fuel consumed is only
marginally reduced under the proposed corridor improvement measures.
25 This disutility is assumed to be a combination of price, time, and reliability of these shipments and
would be inversely related with trade output. Three elasticity’s were calculated: overseas trade for
landlocked countries, overseas trade for coastal countries and trade between countries in the region.
 164

Table 9-8
Potential for Traffic Increases due to Improved Corridor Performance, 2015 (million tons)

Corridor and Type Base Potential %

of Traffic Case Increase Total Change

Northern Corridor
Transit 10.0 1.6 11.6 14%
Regional 5.0 0.8 5.8 14%
Domestic 20.3 0.9 21.2 4%
Total 35.3 3.3 38.6 9%

Central Corridor
Transit 3.2 2.0 5.2 38%
Regional 1.5 0.7 2.2 32%
Domestic 12.8 3.2 15.9 20%
Total 17.5 5.9 23.4 25%

Total 52.8 9.2 61.9 15%

Source: Nathan Associates Inc.

Table 9-9 presents the potential for increased traffic due to improved corridor
performance for 2030. The impact is similar to that discussed above for 2015. Total
Northern and Central Corridor traffic would reach 172 million tons by 2030. Of course,
realizing these increases depends on the ability of the region to overcome very
challenging capacity constraints at border posts, railways, and ports.

Table 9-9
Potential for Traffic Increases due to Improved Corridor Performance, 2030 (million tons)
Corridor and Type Base Potential %
of Traffic Case Increase Total Change

Northern Corridor
Transit 24.7 3.9 28.6 14%
Regional 11.0 1.7 12.7 14%
Domestic 54.0 2.5 56.5 4%
Total 89.6 8.2 97.7 8%

Central Corridor
Transit 12.1 7.8 19.9 39%
Regional 2.6 1.3 3.8 33%
Domestic 40.3 10.5 50.9 21%
Total 55.0 19.6 74.6 26%

Total 144.6 27.8 172.3 16%

Source: Nathan Associates Inc.

This analysis has shown that implementation of the recommended projects will bring
major improvements in the cost, transit time and reliability of the logistic chain of the
Northern and Central Corridors. These gains will promote and facilitate trade and
economic growth to significantly contribute to the attainment of the region’s leaders and
people development aspirations.
 165

WORST CASE SCENARIO

An additional alternative scenario was considered to assess the impact on projected
corridor traffic if the proposed corridor improvements were not implemented. A “Worst
Case Scenario” is evaluated, where it is assumed that none of the proposed projects are
implemented and consequently corridor performance deteriorates as traffic volumes
increase and the transport network gets increasingly congested. As increasing traffic
challenges capacity leading to congestion; transport costs increase along with
deteriorating quality of service along the corridor. Due to the deteriorating corridor
performance, the forecast of traffic demand assumed for the Base Case Scenario will not
materialize. This is due to the reduced competitiveness of the region’s exports and the
increased cost of imports. Also investment in new or expanded production facilities
would be discouraged. Accordingly, this scenario would have a lower GDP growth than
the Base Case. For the Worst Case Scenario we have assumed a worsening corridor
performance in terms of a 25 percent increase in price, time as well as a 25 percent
decrease in reliability coupled with the Low GDP Growth Scenario presented in Chapter 4
that assumed a 40 percent reduction of the Base Case Scenario annual GDP growth rate
per country.

As a result of the Worst Case Scenario, the overall traffic in 2030 would decrease from 145
million tons to 116 million tons, a decrease of 20 percent from the Base Case scenario, as
can be seen in Tables 9-10 and 9-11. In terms of types of traffic, the largest impact would
be for transit traffic; 30 percent decrease from Base Case for the Northern Corridor and 35
percent for the Central Corridor by year 2030. Regional traffic would follow, with a 30
percent decrease for both corridors.

Table 9-10
Worst Case Scenario Traffic by Corridor and Mode 2015 (000 tons)

Corridor and AAGR (%) Rail

Road Rail Total
Type of Traffic 2009-2015 Share (%)

Northern
Transit 5,254 2,401 7,655 4.4 31.4
Regional 3,642 154 3,797 3.3 4.1
Domestic 17,246 1,917 19,162 7.5 10.0
Total 26,142 4,472 30,614 6.1 14.6
Central
Transit 1,175 1,045 2,220 28.1 47.1
Regional 1,068 43 1,111 8.3 3.9
Domestic 11,016 958 11,975 12.5 8.0
Total 13,259 2,046 15,305 13.6 13.4
Total 39,401 6,518 45,919 8.2 14.2

Source: Nathan Associates

Given the relatively short distances that domestic traffic (Tanzanian and Kenyan) travels,
the impact of the worsening performance is less; around 12 percent. In terms of modal
shares, different than the low growth only scenario, there is a change in the domestic rail
traffic share compared to the Base Case. In the Northern Corridor, for year 2015 the
domestic rail share is expected to increase from 5 percent to 10 percent in the worst case
 166

scenario. In year 2030, the share remains about the same. In the Central Corridor, the
domestic rail share is expected to increase from 5 percent to 8 percent by 2015, while it
increases from 6 percent to 11.3 percent in year 2030.

Table 9-11
Worst Case Scenario Traffic by Corridor and Mode 2030 (000 tons)

Corridor and AAGR (%) Rail

Road Rail Total
Type of Traffic 2015-2030 Share (%)

Northern
Transit 11,622 5,572 17,194 5.5 32.4
Regional 7,516 314 7,831 4.9 4.0
Domestic 41,830 5,704 47,534 6.2 12.0
Total 60,968 11,590 72,558 5.9 16.0
Central
Transit 4,137 2,843 6,981 7.9 40.7
Regional 1,740 62 1,802 3.3 3.4
Domestic 31,858 3,259 35,117 7.4 9.3
Total 37,736 6,164 43,900 7.3 14.0
Total 98,704 17,754 116,458 6.4 15.2
Source: Nathan Associates Inc.

A substantial decrease in traffic can be seen in Figure 9-1. The worsening performance
results in a decrease of 19 percent. For Central Corridor the worsening performance
results in a decrease in traffic of 21 percent. Compared to the Base Case scenario, total
traffic in the Northern Corridor by 2030, would be estimated to decrease from 89.6 million
tons to 72.6 million tons. In the Central Corridor, the traffic would decrease from 55.3
million tons to 43.9 million tons.

Figure 9-1
Comparison of Traffic Forecast in Base Case vs. Worst Case Scenario, 2015 and 2030 (million
tons)
Northern Corridor Central Corridor
95 BASE CASE WORST CASE SCENARIO 60 BASE CASE WORST CASE SCENARIO

85 Reg 11.0 Reg 2.6

50
75
Transit 12.1
Reg 7.8
Transit 24.7 Reg 1.8
65
40
Transit 7.0

55 Transit 17.2

30
45

35 Reg 5.0
20 Domestic 40.7
Reg 3.8
Domestic 54.0 Domestic 35.1
25 Transit 11.7 Reg 1.5
Transit 7.7 Domestic 47.5 Reg 1.1
Transit 3.2
Transit 2.2

15 10

Domestic 20.3 Domestic 19.2 Domestic 12.8 Domestic 12.0

5

0
2015 2030 2015 2030 2015 2030 2015 2030
‐5

Source: Nathan Associates Inc.

 167

10. Prioritized Projects for Action

Plan and Summary
In this chapter, we describe the criteria for regrouping of priority projects selected to be
included in the Action Plan. The chapter concludes with a summary of the principal CDS
findings and conclusions.

Criteria for Prioritizing Projects

While all of the infrastructure projects that have been proposed by the CDS are considered
viable and would contribute to the improved performance of the two corridors, funding
limitations may require some of the projects be implemented first on a priority basis while
others are postponed until further funding is available. For this reason, the CDS has been
requested to identify the set of projects that are most appropriate for inclusion in the
Action Plan set of projects to be implemented first in case of financial limitations.

Consistent with the goals and objectives of the CDS and its technical analysis, the
following three criteria have been used to select priority projects for the Action Plan:

• Estimated impact in improving corridor performance in terms of price, time

and reliability
• Estimated economic impact as measured by the economic internal rate of
return
• Readiness for implementation in the near-term

There is no doubt that other considerations could be included as part of the prioritization
criteria, such as strategic considerations for regional integration or political considerations
for a particularly important local project. However, given the CDS focus on improving
corridor performance, we believe that the criteria most directly linked to that objective
from a regional perspective to be the most appropriate.

For the application of these criteria, we identified those infrastructure projects that would
have an impact of at least 5 percent on the corridor performance in terms of either price or
time as well as those projects that had economic rates of return well above average for
 168

their particular sector. For road projects, this meant an EIRR generally of 30 percent or
higher. Finally, the ability of a project to commence implementation and generating
expected benefits and impacts within the next three years was used as a final
prioritization criterion.

Action Plan
Top Priority Infrastructure Projects
Based on the application of the criteria discussed above, Table 10-1 presents the list of top
priority projects among those included in the Action Plan.

TOP PRIORITY INFRASTRUCTURE PROJECTS

In case funding is not available to implement the recommended action plan, the top
priority projects out of the recommended action plan have been identified. Based on the
application of the above criteria and the inclusion of those that are assessed as very critical
for promoting corridor efficiency, a list of 18 top priority infrastructure projects has been
selected (Table 10-1).

Table 10-1
Top Priory CDS Infrastructure Projects

Cost
Name (US$ Corr.
mil.)
Port Projects
Dar es Salaam Short-term Container Handling Capacity 26.0 CC
Mombasa New Container Terminal – Kipevu West** 342.5 NC
Dar es Salaam Container Terminal (Berth 13 &14)** 500.0 CC
Mombasa New Petroleum Facility 55.8 NC
Dar es Salaam Single Point Mooring** 68.5 CC

Rail Projects
TRL Revival Infrastructure, Rolling Stock and Working
Capital and Isaka ICD 185.0 CC
RVR Infrastructure Upgrade 1 - 3 years ** 250.0 NC
RVR Mombasa Intermodal Yard and Equipment** 20.0 NC
RVR Kampala ICD Development ** 10.0 NC

Road Projects
Dar es Salaam port access bypass , new constr. (75 km) 40.0 CC
Chalinze - Tanga: (Coastal feeder) (170 km)** 71.4 CC
Eldoret - Bungoma (104 km) 14.5 NC
Molo - Eldoret (127 km) 17.7 NC
Mombasa - Voi (57 km) 9.9 NC
Voi - Kitui Rd Junction (135 km) 18.8 NC
Mwanza - Sirari/Kisii: Rehabilitation (239 km) 100.4 NC
Bujumbura -Gitega – Muyinga (149 km) 104.3 NC

Total All Top Priority Infrastructure Projects 1,773.0

Projects with funding already identified (**) 1,208.4
Projects requiring funding 564.6
Source: Prepared by Nathan Associates Inc.
 169

The total investment requirement of these projects is US$ 1.8 billion, however, funding of
nearly US$ 1.2 billion for some of these projects has already been committed. Thus US$ 0.6
billion of funding is still required26.The top priority project list includes five port projects,
five rail projects, and eight road improvement projects. The projects are split almost
equally between the Northern and Central corridors in terms of investment cost of US$ 0.9
billion each.

Implementing the top priority Action Plan projects will substantially impact Northern
and Central Corridor performance.

On the Northern Corridor, the proposed projects would:

· Decrease the price of road transport by 23 percent

· Decrease the price of rail transport by 11 percent
· Reduce the time of shipping by road by 28 percent.
· Reduce the time of shipping by rail by an average reduction of 47 percent

On the Central Corridor, the proposed projects would:

· Decrease the price of road transport by 9 percent

· Decrease the price of rail or rail/lake transport by 27 percent.
· Reduce the time of shipping overall by 35 percent

Overall, annual transport cost savings from the implementation of the proposed projects
by 2015 are estimated at US$ 1.2 billion, corresponding to an average reduction in
transport costs of 18 percent.

Top Priority Operational Projects

All of the proposed operational projects have been included as priority interventions for
the Action Plan. These technical assistance projects and policy reforms are considered
essential for engendering the benefits from the infrastructure investments. The 19
operational projects are listed in Table 10-2 and their estimated total cost is US$ 23.2
million.

26 In addition to the US$ 0.6 billion needed to fund the top priority projects, another US$ 2.0 billion would
be required if the complete CDS proposed investment program of US$ 4.2 billion were to be fully
implemented.
 170

Table 10-2
Prioritized Action Plan Operations Projects
Cost
Name (US$
Sector mil.)
Develop Northern Corridor Road Maintenance Contracting System Road 1.0
Develop Central Corridor Road Maintenance Contracting System Road 1.0
Improved Vehicle Overload Control System Road 1.8
Procure and Retain TRL Management Team Rail 2.0
Establish a Regional Railway Safety Regulator Rail 0.4
Develop Vessel Maintenance Capacity on Lake Tanganyika Lake 2.0
Enhance Safe Navigation Lake 3.0
Enhancing Mombasa Port Operations with ICT Applications Ports 2.5
Enhancing Dar es Salaam Port Operations with ICT Applications Ports 2.5
Liberalize Transit Requirements Transit 0.4
Maximize Customs Union Implementation Benefits Transit 0.3
Streamline Customs Clearances Transit 0.9
OSBP Implementation Transit 1.5
Reduce Stops and Informal Payments on Corridors Transit 0.9
Implement an Effective Transit Regime Transit 0.9
Integration of National &Regional Transport Policies Transit 1.1
Leadership by NCTTCA Transit 0.3
Leadership by CCTTFA Transit 0.3
EAC PPP Diagnostic and Institutional Building Study Transit 0.4
Total All Operations Projects 23.2
Source: Prepared by Nathan Associates Inc.

CDS Findings and Conclusions

The CDS has conducted a comprehensive audit of the current performance of the
Northern and Central Corridors, assessed future infrastructure requirements and
formulated strategies for improving corridor performance. A set of infrastructure and
operational interventions have been identified analyzed and prioritized. The key findings
and conclusions emanating from the study are summarized below.

TRAFFIC FORECAST
The amount of traffic forecast for the Northern and Central Corridors will overwhelm the
existing infrastructure and will obvious require substantial investments throughout the
forecast period. Traffic growth implies large future demand on ports, highways and rail.

• Port capacity will need to increase by 24 million tons by 2015 and 117 million tons
by 2030

• Rail network needs to also be able to increase its traffic from 3 million tons to 6.5
million tons in 2015 and 17.7million tons (11million RVR and 6.5 million TRL) by
2030.

• Road network needs to be able to handle 80 percent more traffic by 2015 and 4
times more traffic by 2030.

• If capacity is not increased, congestion at ports and on roads will reach epic levels
and constrain economic growth.
 171

There is a clear need for substantial and targeted investment in regional transport
infrastructure now and continuing for the next several decades

CORRIDOR PERFORMANCE
The two corridors are performing at a level that that generally corresponds to “fair” based
on comparisons with other international corridors. Observations include:

• Berth, yard congestion and lack of customs clearance coordination contribute to

excessive average dwell time of up to 9 days in Mombasa and 12 days in Dar es
Salaam

• Road transport has high costs due to, lack of backhauls and poor road conditions.
On the Northern Corridor high informal payments are a significant component of
total costs.

• Multimodal services such as rail plus lake were formerly highly utilized; still
preferred by shippers. Multimodal shipments can longer than road but can have
a lower cost.

• Rail service, while improving is still unreliable service especially at transfer

points and locomotive exchange points. Rail rates are not necessarily cost based
but are priced just below road transport as rail does not have current surplus
capacity.

• The many border crossings on Northern Corridor and lack of risk management
result in longer delays. There are still long inland clearance time in Kigali, Goma
and Bujumbura.

• Land transport (road or rail) represents the most significant element from the
price point of view (50-80 percent of the total cost) while the port represents 60-80
percent of the total time.

• Extra inventory costs due to delays and inefficiencies in the corridors have a
significant impact on the total costs of the goods, accounting for 10-25 percent of
the total logistics cost.

• In Kenya, vehicles licensed for transit cannot carry domestic cargo and must use
prescribed transit routes. This has the effect of many return trips being empty.
Similarly in Tanzania, the Revenue Authority licenses trucks for transit or
domestic with the same effect.

• Existing overloading control strategy is aimed at achieving 100 percent inspection

of all commercial vehicles. There is no targeted risk management approach and
no incentive to encourage truckers to self-regulate.

• Insufficient use is made of customs tools to expedite processing. Clearance

modernization is being implemented at the national level and the extent of
 172

implementation is varied. Tools include risk management, accredited economic

operators, customs bonds and control points, preclearance and so forth.

STRATEGIES FOR IMPROVEMENT

Improving the efficiency and reliability of the Northern and Central Corridors will require
the adoption and implementation of an integrated Action Plan to simultaneously address
infrastructure constraints and bottlenecks and operational inefficiencies, policies and
procedures.

• As the gateways for the two corridors, the ports of Mombasa and Dar es Salaam must
have adequate capacity and be able to perform efficiently in order for the overall
corridor performance to improve.
• An optimized port / ICD integration program is proposed as a short-term solution to
alleviate such capacity constraints; by transferring cargo handling at the marine
terminals container yards to near port ICDs.
• Both ports have master plans defining long-term development projects, including
new container terminals, which would ease capacity constraints and increase berth
productivity considerably. These should be developed on an accelerated basis.
• Projects to increase capacity for liquid and dry bulk products at the two ports should
be implemented as planned.
• The regional railways will have to increase their freight volumes substantially in
order to become viable. The regional railways will need to target the container sector
in order to achieve the threshold volumes – this will lead to increased competition
with road. Focusing on bulk traffic will in most instances not be enough.
• Road improvements projects are a central component of the improvement strategy
and must be conducted for three categories of roads: (i) upgrade road capacity by
adding lanes to roads with heavily traffic; (ii) rehabilitation of paved roads whose
poor condition affect corridor performance; and (iii) upgrade from gravel to paved
standards key feeder roads that serve the corridors.
• Implement a series of technical assistance interventions designed to improve
transport operations and policies and to ensure that the benefits of the proposed
infrastructure investments are realized.

POTENTIAL IMPACT ON PERFORMANCE

The implementation of the proposed Action Plan projects can have a substantial impact
on the performance of the Northern Corridor and Central Corridors.

• Generally, the price to serve Northern Corridor destinations by road can be

decreased by 25 percent and those destination served by rail by 11-14 percent. In
terms of time, the destinations served by rail can generate an average reduction of 53
percent in shipment time, while destinations served by road have a reduction in time
ranging from 21-33 percent.
• On the Central Corridor the reduction in price for destinations served by road are
generally between 9-11 percent, while destinations served by rail or rail/ lake are
 173

estimated to have reduction in price between 30-36 percent. The percent reduction in
time is generally in the range of 40-50 percent.
• Overall, annual transport cost savings from implementation of the proposed projects
by 2015 are estimated at US$ 1.9 billion, corresponding to an average reduction in
transport costs of 28 percent.

LONGER-TERM NEEDS
As regards addressing long-term capacity constraints to cater for projected huge volumes
of traffic, we are aware that there will be need for implementing other projects beyond the
short to medium actions we have recommended. We are also aware there are plans and
efforts to develop new capacities in new ports, rail modernization and expansion as well
as more road upgrades and further capacity expansion. We have reflected these plans and
expect that clear development options and strategies will have emerged by the time the
recommended action plan is fully implemented. However we consider the recommended
Action Plan to be a strong foundation that is needed to hold future developments. It
creates corridor infrastructure that gives confidence to potential investors in economic or
traffic generating projects or activities. Such investment will catalyze the increase in
demand to support implementation of the long-term of projects that are being proposed.
Appendix A Project Profiles
 A‐1

INFR-P-01
No. Mombasa Short-term Container Handling Capacity 2010-2013
Name: Enhancement with ICDs Action Plan Period:
Mode or Subject Area: Port Intervention Type: Infrastructure
Corridor: Northern Corridor Country(ies): Kenya
Agencies Involved: KPA, CFSs, KMA, Ministry of Transport, KRA EIRR: 165%
Related Projects (Donors):

Background/Rationale:

The Mombasa container handling terminal (Berths 16 – 18) is operating at full capacity: Berth occupancy in
2009 was at around 90 percent as opposed to ideal 70 percent or below. Even with the supplemental
container handling capacity at conventional terminal (Berths 11 – 14) the estimated combined port
container handling capacity of 600,000 TEU is below the 2009 throughput of around 620,000 TEU. Planned
new capacity, in particular new Kipevu terminal, is expected to be available 2013 – 1014, more likely the
latter date. Given the continued growth of container traffic, recorded at an average 9 percent during 2005 –
2009, this means that without any other intervention to create additional capacity in the short-term, there
will be severe congestion with disastrous results for the port and trade in three to five years until new
terminals or additional capacity is available.

Congestion in the port container yard with trucks and people involved in delivery or off-take of cargo
contributes to impeding movement of equipment, especially cranes, resulting in low equipment and Berth
productivity (recorded at around fifteen moves/Berth-hour compared to around sixty moves/Berth-hour
achieved by comparable ports in Asia and South America). In addition, there is no possibility to increase
space beyond the 250 m width (compared to 400 – 500 meters for modern container terminals). During the
last crisis of severe congestion, the off dock ICDs, known in Mombasa/Kenya as CFSs, were engaged in
2007 and have helped decongest the port. In this regard, some of domestic containers are transferred to
CFSs and in the process removing some of the activities from the port container yards to create more
operating space. The proposal is to build on this experience by formally integrating CFSs into the port
system to create much needed additional space, higher productivity and, thus, additional capacity to
handle ships and containers.

Current Status:

Seven off-dock ICDs/CFSs are reported to handle containers (out of licensed seventeen). CFSs handle only
a fraction of domestic containers; transit, reefer, oversize, hazardous and direct import containers are
cleared at the marine terminal. KPA nominates or directs the allocation of boxes to CFSs. CFSs are also
obliged to use KPA tariff which allows free storage until after five days after which payments start and
increase steeply to deter long storage. The tariff is not economic and competitive between CFSs.

Description/ Major Components:

The proposed off-dock ICDs/CFSs Integration Program comprises (1) Relocating all container processing
activities from marine yard to CFSs, thus moving entire ships to CFSs, contracted by shipping lines
competitively (based on quality of service and price). Possible exception could be ready to go rail bound
boxes; (2) Simplifying of transfers between marine yard and CFS, including automation of marine gate and
use of high capacity and specially tagged trucks to provide shuttle services; and (3) CFSs enhancing
facilities and technical competency to handle increased transfers from marine yard and to service clients,
 A‐2

Critical Factors for Success:

(1) Securing acceptance of the proposal by key players and decision makers especially Government, KPA
and KRA. The proposal has been discussed by stakeholders at a roundtable meeting and adjudged
beneficial; (2) Instituting a regulation that will invoke accreditation of CFSs based on transparent known
criteria, define and guide the relationship between the port (marine terminals), shipping lines and CFSs
and create a competitive environment for CFSs operations; and (3) clarifying implementation challenges
including concerns expressed by stakeholders.

Expected Benefits/ Impacts:

(1) - Increasing capacity in the short-term to avoid disastrous congestion: It is estimated that
implementation of the CFS integration program may result in increase of capacity up to 1,350,000 TEU that
would be adequate for at least another five to eight years; (2) Avoiding the cost associated with long
waiting times of ships, low productivity of expensive Berth facilities and equipment as well as surcharges
by shipping lines: these far outweigh the additional costs and extra time for transfers to CFSs.

Costs and Other Data:

Investment Cost PPP

Component Start Year Duration (US$ million) Potential
Facilities improvement, equipment, automation of 2011 8 months 34 Yes
marine gate, acquisition of special vehicles,
improvement of access to CFSs
Technical Assistance to (1) establish regulation and 2011 8 months 1 No
guidelines and (2) to KPA and CFSs for
implementation
TOTAL 35 Yes
 A‐3

INFR-P-02
No. Dar es Salaam Short-term Container Handling Capacity 2010-2013
Name: Enhancement with ICDs Action Plan Period:
Mode or Subject Area: Port Intervention Type: Infrastructure
Corridor: Central Corridor Country(ies): Tanzania
Agencies Involved: TPA, ICDs, SUMATRA, Ministry of Transport, TRA EIRR: 226%
Related Projects (Donors):

Background/Rationale:

The Dar es Salaam container handling terminal (Berths 8 – 11) is operating at full capacity: Berth occupancy
in 2009 was at around 90 percent as opposed to ideal 70 percent or below. Even with the supplemental
container handling capacity at conventional terminal (Berths 5 – 7) the estimated combined port container
handling capacity of 310,000 TEU is below the 2009 throughput of around 354,000 TEU. Planned new
capacity, in particular a new terminal at new Berths 13 - 14, is expected to be available 2014–2015, more
likely the latter date. Given the continued growth of container traffic, recorded at an average thirteen
percent during 2000 – 2008, this means that without any other intervention to create additional capacity in
the short-term, there will be severe congestion with disastrous results for the port and trade in three to five
years until new terminal or additional capacity is available.

Congestion in the port container yard with trucks and people involved in delivery or off-take of cargo
contributes to impeding movement of equipment, especially cranes, resulting in low equipment and Berth
productivity (recorded at around twenty moves/Berth-hour compared to around sixty moves/Berth-hour
achieved by comparable ports in Asia and South America). In addition, there is no possibility to increase
space beyond the 200 m width (compared to 400-500 m for modern container terminals). During the last
crisis of severe congestion, the off- dock ICDs were engaged in 2007 and have helped decongest the port. In
this regard, some of domestic containers are transferred to ICDs and in the process removing some of the
activities from the port container yards to create more operating space. The proposal is to build on this
experience by formally integrating ICDs into the port system to create much needed additional space,
higher productivity and, thus, additional capacity to handle ships and containers.

Current Status:

Six licensed ICDs are reported to handle containers (with additional five under development). ICDs handle
only a fraction of domestic containers; transit, reefer, oversize, hazardous and direct import containers are
cleared at the marine terminal. Shipping lines determine the allocation of boxes to ICDs. However, ICDs
are obliged to use TPA tariff which allows free storage up to seven days after which payments start and
increase steeply to deter long storage. The tariff is not economic and competitive.

Description/ Major Components:

The proposed ICDs Integration Program comprises (1) Relocating all container processing activities from
marine yard to ICDs, thus moving entire ships to ICDs, contracted by shipping lines competitively (based
on quality of service and price). Possible exception could be ready to go rail bound boxes; (2) Simplifying of
transfers between marine yard and ICDs including automation of marine gate and use of high capacity and
specially tagged trucks to provide shuttle services; and (3) ICDs enhancing facilities and technical
competency to handle increased transfers from marine yard and to service clients,
 A‐4

Critical Factors for Success:

(1) Securing acceptance of the proposal by key players and decision makers especially Government, TPA
and TRA. The proposal has been discussed by stakeholders at a roundtable meeting and adjudged
beneficial; (2) Instituting a regulation that will invoke accreditation of ICDs based on transparent criteria,
define and guide the relationship between the port (marine terminals), shipping lines and ICDs and create
a competitive environment for ICDs operations; and (3) clarifying implementation challenges including
concerns expressed by stakeholders.

Expected Benefits/ Impacts:

(1) - Increasing capacity in the short-term to avoid disastrous congestion: It is estimated that
implementation of the ICDs integration program may result in increase of capacity up to 1,050,000 TEU
that would be adequate for at least another eight to ten years; (2) Avoiding the cost associated with long
waiting times of ships, low productivity of expensive Berth facilities and equipment as well as surcharges
by shipping lines: these far outweigh the additional costs and extra time for transfers to ICDs.

Costs and Other Data:

Investment Cost (US$ PPP

Component Start Year Duration million) Potential
Facilities improvement, equipment, automation 2011 8 months 25 Yes
of marine gate, acquisition of special vehicles,
improvement of access to ICDs
Technical Assistance to (1) establish regulation 2011 8 months 1 No
and guidelines and (2) to TPA and ICDs for
implementation
TOTAL 26 Yes
 A‐5

No. INFR-P-03 2010-2014

Name: Mombasa New Container Terminal – Kipevu West Action Plan Period:
Mode or Subject Area: Port Intervention Type: Infrastructure/TA
Corridor: Northern Corridor Country(ies): Kenya
Agencies Involved: Kenya Ports Authority, Kenya Maritime Authority EIRR: 37%
Related Projects (Donors): Technical Design Nearing Completion. Dredging tendered. JICA Loan.

Background/Rationale:

Mombasa Container Terminal (Berths 16 – 18) is currently operating at around 90 percent Berth occupancy,
with an average annual growth in traffic since 2005 of 9 percent. The negative impact on vessel wait time,
ship turnaround time at the port, and quay and yard operations require urgent action. Over one quarter of
throughput is transit cargo, with 80 percent to Uganda. Construction of a new container terminal is critical
to economic growth of Kenya and that of the land locked countries Mombasa serves. This will be KPA’s
first concession for terminal operations. In addition to this project, KPA is extending the existing terminal
to Berth 19 (tenders submitted September 30, 2010) and plans to upgrade and convert Berths 11-14 to an
additional container facility with a private operator. All these projects are expected to add capacity to the
Mombasa container handling system from 2003. Therefore the new Kipevu Container Terminal project is
within a broader strategy to meet the medium and long-term demand for container handling in the region.

Current Status:

The technical designs for the container terminal are being finished. A loan agreement has been signed with
JICA for US$239 million to finance the terminal and related equipment and access road. Tenders for the
dredging were submitted in February 2010. Consideration of legal requirements for a concession is
underway.

Description/ Major Components:

The site is 100 hectares near the Kipevu Oil Terminal. The terminal will be built in 3 phases. (1) The
terminal is designed to handle 450,000 TEU in the first year 2013 and, when completed, 1.2 million TEU.
The JICA loan will cover construction, ship to shore gantry cranes, rubber tired cranes, and construction
and extension of yards, (2) A concessionaire will be recruited to provide handling equipment and operate.
JICA will also assist with concessioning plan and selection. (3) A related dredging program for the entrance
channel (15 m), widening the turning basin and Berth (11-15 m) will allow vessels carrying up to 4,600
TEU. (4) Extension of rail access to the terminal and buoy and channel markers in the access channel. (5)
Construction of a new access road to the terminal, possibly to be operated as a toll-road (6) TA: A
consultant to advise on the final terms for the concession based on experience with similar terminal
concessions worldwide.

Critical Factors for Success:

(1) A strong tendering process that results in an experienced, competent and well-resourced operation. (2)
A concession agreement that provides sufficient latitude for effective operation while requiring a defined
level of performance. (3) An effective reporting and monitoring system that will insure the government
achieves value from its investment. (4) A competition strategy and structure among the container
terminals at Mombasa that will reduce price and increase performance.

Expected Benefits/ Impacts:

 A‐6

The second Kipevu terminal will double current container capacity by 2018 to meet the needs projected for
the medium-longer term. High performance standards due to appropriate terminal design, experienced
operator, optimal handling equipment and state of the art information systems to generate the needed
coordination and speed to achieve internationally competitive performance standards at Mombasa.

Costs and Other Data:

The construction will be in three phases. The first phase is intended to commence in 2011 and be
completed in 2013/4. Later phases will follow after opening. KPA will function as a landlord, while
operations will be concessioned. Therefore the terminal and equipment will represent a PPP arrangement.

Investment Cost (US$ PPP

Component Start Year million) Potential
Terminal 2011 Yes
240
Equipment 2012 Yes
TA-Concessioning and Competitiveness 2011 0.5 No
Dredging 2011 90 No
Road Access to Terminal, included in 2012 12 No
terminal financing
TOTAL 342.5 Yes
 A‐7

No. INFR-P-04 2011-2014

Name: New Container Terminal at Port of Dar es Salaam Action Plan Period:
Mode or Subject Area: Port Intervention Type: Infrastructure
Corridor: Central Corridor Country(ies): Tanzania
Agencies Involved: Tanzania Ports Authority, private sector logistics operators EIRR: 35%
Related Projects (Donors): Existing Concession with TICTS, Government of China

Background/Rationale:

In 2009, the Port of Dar es Salaam handled 373,500 TEU with a berth occupancy rate of 88.7 percent.
Between 2000 and 2008, average annual growth rate has been 13.5 percent, meaning that additional
capacity is urgently needed. The TPA concessioned the container terminal in 2000 to the Tanzania
International Container Services (TICTS), with Hutchinson HP holding majority shares. TICTS achieved
good performance standards initially. But traffic quickly outgrew the confined container terminal from
2004 resulting in severe congestion in a few years thereafter. Congestion on the quayside directly affects
ship unloading/loading speed, leading to delay charges, and yard congestion leads to high stacks and long
dwell time.

The container terminal is located at Berths 8-11, after Berth 8 was added in 2005 and confirmed in 2010 on
conclusion of a renegotiated extension of the TICTS lease agreement, Conventional Berths 5 – 7 are also
used to handle containers as well. Container stacks also operate behind some of the bulk and break bulk
berths. In 2008, dwell time reached twenty-eight days and the port sought to relieve the capacity problems
in the port by using ICDs to do the clearances for domestic cargo. This has improved port performance but
has not addressed future capacity needs given the high rate of container traffic growth. Consequently,
within the recently completed Ports Master Plan (2009) TPA has determined that a new terminal was
needed. TPA plans to develop the terminal and tender it to a private operator, preferably in competition
with TICTS.

Current Status:

A feasibility study was completed in 2010. A consultant to prepare detailed design has been procured and
design is ongoing. Negotiations are ongoing with the Chinese Government to provide financial support.
The experience with the first concession will be taken into account in designing a legal agreement with the
second concessionaire.

Description/ Major Components:

Construction of Berths 13-14 upstream next to Berth 12, the Kurasini oil jetty (KOJ). This is the only area
where additional container capacity can be created in the near term. The terminal consists of a quay with a
length of 650 m that can accommodate two large container vessels and a small feeder vessel. This terminal
will have a capacity of 600,000 TEU. It is in a relatively confined area, which will affect design of the
channel and adjustment of the KOJ, by either relocation or shortening the pipes as proposed in the Master
Plan.

Critical Factors for Success:

The success factors for the project will be dependent on availability of financing, a good procuring system
for the operator, the experience and commitment of the operator selected and the terms of the agreement
between the operator and TPA. The market demand is such that the likelihood of a successful operation is
high.
 A‐8

Expected Benefits/ Impacts:

The existing container terminal is operating at full capacity and is not adequate to cater for current and
future demand. Productivity is also low due to restricted movement of equipment in the limited space.
Once both the existing and new terminals operate at more optimum levels, better port performance is
expected. Having two competing terminals should drive the cost and delays down thus benefitting the
shipper. The diagnostic study demonstrated that the port constituted the single greatest delay factor on the
corridors. It is expected that the second terminal will assist to decongest both terminals, thereby reducing
the delay factors at the port, beyond the short-term relief expected from implementing the proposed
integrated ICD system

Costs and Other Data:

Investment Cost PPP Potential

Component Start Year Duration (US$
million)
Container Terminal at Berths 13-14 2011 3 years 500 Yes
TOTAL 500 Yes
 A‐9

No. INFR-P-05 2011-2013

Name: Mombasa New Petroleum Terminal Action Plan Period:
Mode or Subject Area: Port Intervention Type: Infrastructure
Corridor: Northern Corridor Country(ies): Kenya
Agencies Involved: Kenya Ports Authority EIRR: 35%
Related Projects (Donors): Pipeline Upgrading and Uganda Petroleum Developments

Background/Rationale:

Kipevu Oil Terminal handles crude oil and refined oil products and can accommodate vessels to 85,000
DWT and up to 198 m long. In 2008, it was at 78 percent Berth occupancy and in 2009 was at 86.5 percent.
Vessel delays to Berth currently cost the petroleum industry an average of US$100 million annually. The
port needs new petroleum capacity urgently. The Shimanzi Oil Terminal, which can accommodate vessels
up to 35,000 DWT and 259 m long, handles chemical and other liquid products. This terminal was
operating at 62.5 percent capacity in 2008 and 75 percent in 2009. KPA considers it “tending toward
saturation”. Therefore the Port of Mombasa has a major problem with liquid bulk products. This affects
not only Kenya, but also Uganda, Rwanda and any other country importing petroleum and other liquid
bulk through the Port of Mombasa.

Current Status:

An international tender was issued by the National Oil Corporation of Kenya in late 2010 for a technical
feasibility study of the construction of an offshore petroleum offloading jetty at Mombasa. EOIs were due
December 3, 2010. It can be assumed that a full contract will be issued during 2011.

Description/ Major Components:

The project is designed to meet the need for additional liquid bulk capacity through design of a BOT
project for a single buoy point or off shore jetty system. The project is valued at US$55 million and will
involve the Government of Kenya and the private sector. It will be further defined by the feasibility study.

Critical Factors for Success:

It will be critical to develop a BOT framework that meets the Kenyan and regional need for petroleum and
sufficiently rewards the private sector for participation. Appropriate connections to the Kenyan pipeline
are essential to success. Review of the pipeline capacity is also being undertaken. Decisions on the
pipeline and estimates of total regional demand will be affected by the development of the petroleum fields
in Uganda. The first area is underway and a feasibility study is being conducted for a Ugandan refinery.

Expected Benefits/ Impacts:

Due to the saturation level at the petroleum terminal, this project has high priority. The chemical products
terminal project is essential to the further development of manufacturing in the region and to the mineral
development currently being increased.
 A‐10

Costs and Other Data:

Investment Cost (US$ PPP

Component Start Year Duration million) Potential
Feasibility Study 2011 9 months 0.8
Construction and Installation 2012 24 months 55 Possible
BOT
TOTAL 55.8 Yes
 A‐11

No. INFRA P-06 2011-2013

Name: Mombasa Dry Bulk and General Cargo Facilities Action Plan Period:

Mode or Subject Area: Port Intervention Type: Infrastructure

Corridor: Northern Corridor Country(ies): Kenya
Agencies Involved: Kenya Ports Authority, Private sector logistics operations EIRR: 25%
Related Projects (Donors):

Background/Rationale:

Mombasa Port handles dry bulk at Berths 1-10, operated by KPA, and at Mbaraki Wharf, which is a
common user facility. Because the handling of dry bulk varies by commodity, port saturation is also
determined for each commodity. For example, for wheat a berth occupancy maximum of 60 percent has
been set since all wheat must be unloaded at berth 3 to use the conveyor to Grain Bulk Handlers Ltd.
(GBHL) silos. The analysis in the Master Plan indicates that for coal, clinker and fertilizers, whether
handled at Berths 1-10 or Mbaraki Wharf, construction of a new berth will be necessary, possibly at Dongo
Kundu. Bulk handling is often inefficient and slow by international standards leading to delays of ship
departure. The delay charges are passed to the buyer making fertilizer, clinker and other bulk products
more expensive for the end user. GBHL estimates, for example, that the cost of fertilizer could be reduced
25 percent with a good bulk handling system for fertilizer at the port. In 2007, 1.5 million tonnes of
fertilizer, clinker and coal in total moved through Mombasa Port in 2007. The total is estimated to increase
to 2.38 million by 2013.

Current Status:

KPA reports 74.3 percent overall berth occupancy in 2006, 66.2 percent in 2007 and 57.2 percent in 2008.
While lower in 2008, KPA rates Mbaraki Wharf as tending to saturation and needing attention. The master
plan reviewed the current facilities and usage, made projections for future growth and proposed project
components to improve port efficiency in handling dry bulks.

Description/ Major Components:

Mbaraki Wharf: It is proposed to use this facility for all dirty bulk cargo, such as clinker, coal, iron ore,
fertilizers, etc. Components of proposal: (1) new access bridges. At present, only trucks of 7 tonnes or less
can use the bridge and turn in the port. Therefore it is necessary for them to collect cargo, dump behind
the wharf and use front end loaders to load larger, articulated trucks for haulage. It is proposed to build
two new bridges that can accommodate articulated trucks entering the wharf. This is time consuming,
costly and increases the air pollution from port operations. (2) dust suppression. Operators should
improve off-loading and loading practices and keep the dust screens well maintained. (3) berth deepening.
Berth should be deepened to -12.5 m to allow larger ships to dock, thereby reducing cost and making the
wharf more efficient. The pilings are deep enough to allow this. Dredging should be done at the same
time the new bridge is built. (4) berth extension. It is recommended that the berth be extended by 220 m,
based on projections of demand. Depending on the availability at Berths 1-10, it may be possible to delay
until a new berth can be built at Dongo Kundu. A power station is being constructed at Dongo Kundu and
will need to import 1 million tonnes of coal per annum. This could be handled by a dedicated jetty or a
common user bulk facility. It is possible to develop a new dry bulk facility in conjunction with this facility
for cost sharing. Decisions on berth extension are likely to wait until these issues of location and
consolidation are determined.

Berths 1-10. The master plan suggests the following use for Berths 1-10. Depending on final decisions on
location of specialized facilities, there will be construction and equipment procurement to be tendered.
Berth 1 should continue to be used for RoRo vessels and cruise ships at present. Development of a cruise
 A‐12

ship terminal is in the planning stages. Berth 3 should continue to be used for grain and the conveyor
extended to Berth 4. Berth 5 should be used for RoRo vessels and general cargo such as steel. It could also
be converted to an additional grain terminal. Berth 7-10 should continue to handle general cargo, bulk
liquids and any dirty bulks that cannot be handled at Mbaraki Wharf. Berth 9 is used by the soda ash
industry which intends to install high capacity conveyors once traffic picks up again. The main changes
are some repaving and taking down some sheds to allow more storage areas.

Critical Factors for Success:

Terminal and berth usage needs to be responsive to demand. Many of the project proposals are contingent
on volumes and pressures in other parts of the port. Success will depend on good monitoring and
coordination of use areas within the port. The effectiveness of the changes is also dependent on the
flexibility built into the design and on operational adjustment to new facilities.

Expected Benefits/ Impacts:

The effective operation of bulk handling and general cargo is essential to agriculture and industry for
Kenya and the inland countries. The impact of the new access bridges is the efficiency of a single loading
and reduced dust caused during the second loading at the back of the port. Avoidance of double handling
will also reduce the cost of the products. Cost savings are estimated at US$0.11 per tonne. Wharf
deepening will allow larger ships which are more efficient and thereby reduce the cost of imports.

Costs and Other Data:

Investment Cost PPP

Component Start Year (US$ Potential
million)
2 new access bridges 2011 1.5
Deepening berths to -12.5 m 2011 0.2
Berth extension or new berth construction TBD
TOTAL 1.7 No
 A‐13

No. INFR-P-07 2012-2013

Name: Dar es Salaam Dry Bulk and Break Bulk Facilities Action Plan Period:
Mode or Subject Area: Port Intervention Type: Infrastructure
Corridor: Central Corridor Country(ies): Tanzania
Agencies Involved: Tanzania Ports Authority EIRR: 25%
Related Projects (Donors):

Background/Rationale:

The port handles about 95 percent of Tanzania’s international trade as well as transit cargo for Burundi,
Rwanda, Uganda, DRC on the Central Corridor. It has a rated capacity of 4.1 million dwt dry bulk cargo.
This is sufficient for the near term, but high estimates put the requirement for 2023 at 4,779 and for 2028 at
6,056. The efficiency of the operation is also a major factor, with delays in ship offloading causing penalty
charges which are passed to customers. Dry bulk is generally handled at Berths 5, 6and 7, but only 7 can
handle vessels with drafts exceeding 10 m. Cement, clinker and coke are transported by truck directly to
the cement plant. Bulk grain and fertilizer is bagged on the quay which slows offloading and restricts
movement on the quay. The Port Master Plan recommended that bagging at shipside should be
discontinued and commodities moved directly to bulk storage facilities where bagging can be done. The
Grain Terminal has a fully automated silo for handling import and export grain including three bagging
units. Grain is transferred from the quay by ten dump tractors to a silo that holds 30,000 tons. The existing
silo should be used for intermediate storage to increase the unloading capacity on the quay. The storage
capacity should be increased to 60,000 tonnes. A private organization, the Dar es Salaam Corridor Group, is
building a grain facility close to the port, and is designed to be linked to the terminal with conveyors.
Cement should be transported by conveyor belt to the packaging area at the back of the port. Fertilizers
should be stored in a bulk warehouse, Shed 7, where it can be bagged and loaded on trucks or rail wagons.
Other dry bulks can be handled at berths 5, 6 or 7 and stored in a shed based on allocation and availability.

General cargo is also increasing although more slowly. It is expected to approximately double from 2013 to
2023, from 655,000 to 1,317,000 tonnes. By 2028, it is estimated to be 1,842 tonnes. Break bulk is currently
offloaded at Berths 1-7, depending on vessel draft and berth availability. Heavy and dangerous goods are
loaded immediately on rail. Other goods are taken by truck to storage yards. To accommodate this growth
and achieve greater efficiency, Berths 1-4 should be deepened to allow larger ships and make better use of
the existing port.

Current Status:

Tanzania Ports Authority has begun to implement these recommendations. Two tenders were issued in
late 2010 for award in early 2011 for study of the silo and silo system at the port and provision of bulk
handling facilities for grain and fertilizer. Separate tenders were issue for civil works for handling grain
and fertilizer. Other tenders were issued including for paving the area previously occupied by shed 4 to
increase the yard area and procuring additional handling equipment and port vehicles. Some dredging is
ongoing. These developments will take on board the facilities being developed by the private sector, in
particular the Dar es Salaam Corridor Group.

Description/ Major Components:

Dry Bulk: (1) Creation of a specialized dry bulk terminal at Berths 5-7 and dredging to -12 m. Sufficient
quay length is available. Quay construction needs to be strengthened to accommodate heavier cranes and
deeper drafted vessels. A conveyor belt is planned to move cement to the packaging area. It needs to be
above ground and high enough for vehicles to pass underneath. A traffic circulation pattern is needed for
all the trucks moving between quayside and port storage facilities. (2) Expansion of the grain silo from
30,000 to 60,000 tonnes to allow handling of larger vessels.
 A‐14

Break Bulk: (1) Strengthening the quay at Berths 1-4 and dredging to a depth of -12 m. A quay wall is to be
constructed at the current lighter quay adding land fill behind it to add 260 m to the quay length, which is
anticipated to meet requirements until 2028. This can be done at the same time that the access channel is
dredged to -12 meters. (2) Developing a dedicated general cargo facility at Berths 1-4. Plans to use the
storage space behind berths 1-7 for break bulk and dry bulk should be made and implemented once the
new container terminal relieves the need for container storage in this area.

Critical Factors for Success:

Implementation requires that the short-term solution of more effective use of ICDs is implemented to
reduce the spillover of containers into other areas. At the same time, the development of the new container
terminal at Berths 13-14 is also a critical success factor. Both will enable the development of dedicated
terminals for dry bulk and break bulk/general cargo and better offloading and handling practices because
of reduced congestion at the quay side, yard and storage areas.

Expected Benefits/ Impacts:

Both dry bulk and break bulk are increasing rapidly. The development of dedicated terminals and more
efficient handling operations will foster this growth. In both cases, larger vessels are encouraged through
greater depth and length of the quay. This will enable faster loading and unloading times and should
mean lower costs due to economies of scale and improved productivity. Many of the industries
developing in the area are dependent on cost effective transport of inputs such as grain for milling, seed
and fertilizer for agriculture, equipment for agriculture and manufacturing, etc. All of these industries will
benefit from the increased efficiency and lower cost made possible by the project. In case of surplus, based
on the drive to rapidly expand agricultural production, exports will also be handled more efficiently and at
reduced cost for competitiveness in the export markets.

Costs and Other Data:

Investment Cost (US$ PPP

Component Start Year Duration million) Potential
Development of dry bulk terminal at berths 2011 24 Yes
5 – 7 (dredging, berths, etc) and facilities
(silo system, equipment, etc)
Development of break bulk terminal at 2011 24 Yes
berths 1 – 4 (dredging, berths, etc) and
related facilities
TOTAL 5.0 Yes
 A‐15

No. INFR-P-08 2010-2013

Name: Dar es Salaam Single Point Mooring (SPM) Action Plan Period:
Mode or Subject Area: Port Intervention Type: Infrastructure
Corridor: Central Corridor Country(ies): Tanzania, Zambia
Agencies Involved: Tanzania Ports Authority (TPA) EIRR: 35%
Related Projects (Donors): TPA Master Plan

Background/Rationale:

The original SPM was built in the 1970s to supply crude to refineries in Tanzania and Zambia. After
closure of the Tanzanian refinery, it served only Zambia. Zambia consumed 15,300 barrels of crude, of
which 15,110 are imported, in 2009. Its total refining capacity is 24,000. However, there are plans to
establish a new modern refinery in Tanzania with new pipelines to Mwanza and Kigoma. Discussions have
been carried out with potential international private sector developers. A significant share of Zambia’s
petroleum is crude oil shipped from the Port of Dar es Salaam via pipeline to the Indeni Petroleum
Refinery in Ndola at a considerable savings in cost over importation of finished product by rail or road and
reduced theft and accident risk. TAZAMA Pipeline is jointly owned by Zambia (66.7 percent) and
Tanzania (33.3 percent). As part of the Tanzania Ports Master Plan, Royal Haskoning reviewed the market
for petroleum through the port of Dar es Salaam and found a viable market in nearby countries.

Current Status:

A consulting consortium was contracted to act as financial and economic advisor to the project. It carried
out traffic forecasts and analysis of the logistics, financial and economic impact of the project. In
September 2010, Leighton International signed an EPC, fixed lump sum contract with TPA for construction
of the US$66.48 million project.

Description/ Major Components:

The project consists of construction of the SPM and two subsea pipelines. One will be 28” in diameter for
crude oil and one 24” for white product, with a length of 4.5 km and 4 km respectively. The SPM is being
constructed southeast of the harbor entrance and will accommodate ships from 40-150 KDWT. (1) The
project includes removal of the old SPM system and onshore pipelines. (2) The contractor is responsible for
project management, design, engineering, procurement and construction. (3) It includes an ocean study
and site survey. (4) The contractor will fabricate and install the SPM system, procure and install off shore
pipelines and on shore pipelines. The contractor will test and commission the system. Construction will
start in 2011 and is expected to be completed in 2012.

Critical Factors for Success:

The project is based on projections of increased domestic and regional demand for crude and white
product to be delivered on the new system. It also assumes the probably redevelopment of a refinery in
Dar es Salaam. The project viability will depend on the success in marketing the product regionally based
on the reduced price of pipeline as opposed to road and rail transport delivery.

Expected Benefits/ Impacts:

TPA expects the new facility to provide increased revenue in addition to improvement in quality of service,
safety, efficiency and the capacity to handle bigger vessels. The Port of Dar es Salaam and particularly the
oil terminals are congested with frequent wait times off shore and terminal delays. All these delays
increase the cost of delivered fuel. The SPM should eliminate the delay factors for petroleum deliveries to
Dar es Salaam and reduce the delays of other vessels using the entrance channel.
 A‐16

Costs and Other Data:

Investment Cost (US$ PPP

Component Start Year Duration million) Potential
Fixed Price, Lump Sum Project Cost 2011 2 years 68.5
TOTAL 68.5 Yes
 A‐17

No. INFR-P-09 2010-2013

Name: Lamu Corridor New Port and Associated Infrastructure Action Plan Period:
Mode or Subject Area: Port Intervention Type: Feasibility Studies
Country(ies):
Kenya – serving Kenya, Sudan, Uganda, Ethiopia,
Corridor: Northern Corridor DRC
Agencies Involved: KPA, Ministry of Transport, RECs EIRR: 30%
Related Projects (Donors):

Background/Rationale:

The original motivation for the development of a new port at Lamu in the 1970’s, was the problem of
congestion at Mombasa port, which serves as Kenya’s only port for international trade, and which was
considered to be approaching its maximum development capacity. Since then, the freight throughput at
Mombasa has expanded more than threefold from 6 mtpa to more than 19 mtpa, and further expansion is
being planned and implemented. However, long term expansion at Mombasa is limited, particularly for
larger ‘Cape Size’ vessels, which are increasingly used for oil, bulk and containers. Manda Bay, located
close to Lamu town, is considered ideal for the development of a deep sea port, with marine access depth
of more than 18m.

At present, there is no infrastructure at Lamu to support the development of a major new port – services
such as road and rail transport, pipelines, water, electricity, communications, housing including the basic
infrastructure, will have to be incorporated into a new port development. The Lamu area has been declared
as a world heritage site, and there will be environmental constraints on future development, particularly
potentially polluting activities such as oil and bulk minerals exports.

During 2005/6, the Kenyan government, in discussions with southern Sudan and Ethiopia developed the
ROOLA project, which included the following infrastructure components:

• Oil pipeline from Southern Sudan to Lamu

• A high speed standard gauge railway linking Lamu to Juba, with links to Addis Ababa and to
Gulu in Uganda
• A super highway network linking Lamu to southern Sudan, Ethiopia, and the existing road
network in Kenya and Uganda
• A fibreoptic cable along the main transport routes
• The development of an oil refinery and free port at Lamu.

The ROOLA project has effectively been replaced by the LAPSET project (Lamu Port, Southern Sudan,
Ethiopia Transport Corridor) , aimed at developing a master plan for the port development, with the study
to be completed during 2011. The intention is to fund the project through a PPP process.

Such a grand regional infrastructure project will require one or several major anchor projects in order to
motivate the initial financing of the core infrastructure. This is likely to be one or several of the following:

• Oil exports from Southern Sudan, could be of the order of 500,000 bbl/day or +20 mtpa
• Oil exports from Uganda, could be up to 150,000 bbl/day or 7 mtpa
• Future iron ore exports form Mt Kodo in the DRC, up to 50 mtpa in order to justify the cost of a
dedicated heavy haul line over 1,600 km
• The development of a new container terminal at Lamu, to serve southern Sudan, Ethiopia, and
increased demand from the northern corridor, supplementing Mombasa port – this is viewed as a
longer term project, given the current expansion projects at Mombasa

The development and timing of the bulk export project listed above are subject to political developments
in respect of southern Sudan, and also to market forces and commodity price trends in respect of mineral
 A‐18

exports. This will dependent on the finalization of development strategies, which will also involve
governments, and when a sound business case presents itself, to allow the conclusion of long term
contracts

Current Status:

During 2010, Japan Port Consultants were appointed to carry out a feasibility study, funded by the Kenyan
Government, to be completed during 2011. KPA is directly involved in the study which is understood to be
focused on the port master plan development for Lamu. The referendum on the independence of southern
Sudan is taking place in early January 2011, the outcome of which will influence the structure and timing of
the LAPSET project.

Description/ Major Components:

The initial focus is on the completion of the current feasibility study, and depending on the results of the
study, this is likely to be followed by a detailed Environmental Impact Assessment. The study is expected
to include future projections of regional trade and freight flows.

Critical Factors for Success:

The key success factor is in the first instance, a positive outcome of the feasibility study, and secondly, a
positive EIA, which is necessary for any institutional funding of the project. For the project development as
a whole, and as defined by LAPSET, the outcome of the southern Sudan independence referendum is
clearly important. However, it is possible that the Lamu port development could proceed without the
participation of southern Sudan – the feasibility should provide an indication of this.

Expected Benefits/ Impacts:

The possible long term economic benefits of a new port development at Lamu are:

• An alternative port serving east Africa, increased competition, improved performance lower prices
• Serving the land locked regions of southern Sudan and the undeveloped regions of Kenya and
Ethiopia, with a possible free port at Lamu
• Supporting the development of bulk terminals for oil and minerals, which would be difficult to
locate at Mombasa

Costs and Other Data:

Investment Cost (US$ PPP

Component Start Year Duration million) Potential
LAPSET Port feasibility study 2010 1 year 6 No
Detailed Environmental Impact Study 2011 1 year 1 No
MOU or Agreement with major anchor 2012 Open Open Yes
project
TOTAL 7 Yes
 A‐19

INFR-RL-01
No. Tanzania Railways Ltd Revival – Track, Equipment and 2011-2013
Name: Terminals Action Plan Period:
Mode or Subject Area: Railway Intervention Type: Capital, PPP
Corridor: Central Corridor Country(ies): Tanzania
Agencies Involved: Ministry of Infrastructure Dev (Min of Transport), RAHCO, TRL EIRR: 38%
Related Projects (Donors): Procure and Retain TRL Management Team, WB support.

Background/Rationale:

The Tanzania Railway Corporation/Tanzania Railways Limited (TRC / TRL) service has declined over the
past five to six years and traffic levels have fallen to less than 30 percent of the previous highest levels,
mainly due to the following events: (i) lack of investment and poor performance of the railways over the
period, (ii) the suspension of the Ugandan rail ferry service; (iii) the 2009 flood damage, causing a six
month service suspension, and (iv) the failure of the concession with Rites, operating as TRL. The absence
of new investment, the declining income and lack of working capital resulted in deferred maintenance of
both track infrastructure and equipment, leading to an increasingly unpredictable and unreliable service,
and which has severely restricted operating capacity, and the ability to existing and new customers.

TRL is unable to implement a short-term sustainable revival plan without a substantial capital investment,
estimated to be about US$110 million over a two year period. The capital injection will be required to be
justified by a detailed business plan to be prepared by a new management team to be appointed. The TRL
service is particularly critical for Burundi, because it previously carried all Burundi’s international trade,
which is now routed via a much longer and more expensive road route. The same applies to trade with the
eastern DRC through the lake ports of Kigoma and Kalemie. The TRL service also provides the shortest
distance to any port from Rwanda, and the decline of the lake and rail service has resulted in Rwandan
transit traffic being shifted from the Central to the Northern Corridor, at additional cost. As a result of the
failed concession, the original budget allocated for the revival of the system, particularly the repair and
upgrading of track, (some sections of track date back to 1912), is no longer available.

In respect of the locomotive fleet, when the TRL concession commenced in 2006, the total diesel electric
locomotive fleet numbered eighty-two units, of which only sixty-five were considered operational, but
most of which suffered from deferred maintenance, which translated into very poor reliability. In addition,
TRL has thirty-four smaller diesel hydraulic ‘shunting’ locomotives, of which twenty-seven were recorded
as being active. The core of the mainline locomotive fleet consists of thirty-five Canadian MLW Bombardier
locomotives, relatively small locomotives of 1,200 hp, of a similar size to those used by Uganda Railways.
MLW in Canada ceased diesel electric locomotive production in 1985 (twenty five years ago), and were
taken over by GE, which closed the plant in 1993. The bulk of the TRL locomotive fleet can be considered to
be beyond its economic life, although it has been possible to keep most of the locomotives operational
through a process of continuous repair. When the Government and Rites of India TRL concession
commenced operation in 2006, twenty-five used locomotives were imported from India on a lease basis to
supplement and replace the MLW units. However the Indian locomotives were not put into service with
TRL because of a dispute with the TRL workforce, which considered them to be no better than the existing
TRL locomotives. The situation appears to have been resolved in January 2011, but TRL urgently needs to
supplement their fleet of available locomotive through repair, acquisition and/or leasing.

When the TRL concession commenced in 2006, the total wagon fleet numbered 1,847 units, of which 1,245
were considered operational, but many of which were ‘outdated’ in their function – such as cattle wagons
and many of the large covered wagons, suitable for breakbulk only. Almost all the wagons are of the bogie
type, having two sets of two 15 t axles, capable of carrying up to 43 t of freight. Many of the wagons also
suffer from deferred maintenance, and poor reliability. Typically, it is the bearings, wheels and brakes that
 A‐20

require attention. The bulk of the freight wagon fleet should ideally consist mostly of low sided open
wagons, which can carry heavy bulk goods and also ‘drop in’ containers – two TEU, and also specialized
container wagons and fuel wagons. The current fleet consists of 232 high and low sided open wagons, 84
specialized container wagons, and 145 fuel tanker wagons. Many of the covered wagons, which number
more than 720, could be converted to open wagons or container wagons. It is also a relatively cheap and
simple process to convert older plain bearing wagons to more reliable and heavier roller bearing axles –
this has been carried out extensively in South Africa, Zimbabwe and Mozambique where some serviceable
and operating wagons are more than fifty years old. The configuration of the TRL wagon fleet needs to be
updated to reflect the future projected freight profile, as defined by the new ‘revival’ business plan.

In order to recapture freight volumes from road haulers, TRL needs to further develop an efficient road/rail
transfer terminal at Isaka to serve the mining Tanzanian mining and agricultural sectors and the Rwandan
market. Prior to 2004, the TRL rail service on the Central Corridor carried virtually all the transit traffic
between the port of Dar es Salaam and the land locked countries of Rwanda and Burundi, and also a
significant portion of the trade with Uganda and the eastern DRC. There were also block or unit train
operations between Dar es Salaam and Isaka. Since the decline of the TRL service over the past seven to
eight years, reflected as lack of capacity and unreliability, most of the Central Corridor transit traffic has
moved to road transportation, and in respect of Uganda and Rwanda, there has been a major diversion to
the Northern Corridor serving the port of Mombasa. In the case of Rwanda, this has resulted in a longer
and more expensive route for international trade, and for transit trade via Dar es Salaam, a much more
expensive road service. The business plan for the planned revival of TRL over the next two years will
include a target to recapture the Rwanda transit traffic as a multimodal service – by rail between Dar es
Salaam and Isaka, about 900 km, and by road between Isaka and Kigali, about 460 km. The development of
the Isaka ICD should be promoted by TRL as a railway services marketing drive, to serve Rwanda and
north eastern region of Tanzania, including the rapidly developing mining sector, as well as parts of
Eastern DRC close to Rwanda.

Current Status:

Government has initiated the process of selecting a new management team for TRL, in order to prepare the
necessary business plan to support new funding. The World Bank has indicated its support during the 4th
Joint Infrastructure Sector Review in Dar es Salaam, by requesting that the new business plan must be
focused on core business only. Some funds have been made available from the World Bank for consultants
and T/A support for TRL.

The collapse of the Government and Rites of India TRL concession has resulted in withdrawal of the capital
investment budget, and TRL is therefore unable to fund track, locomotive and wagon repair routine
maintenance, let alone necessary repairs and upgrading. TRL is in an interim phase with no ability to
secure new business until a new management team has developed a new business plan to support new
investment. Besides a program for track and equipment rehabilitation, a fully equipped ICD at Isaka is
likely to be an important element of the TRL business plan, whether or not it is directly finance and
operated by TRL. This could be developed by the private sector, but subject to performance commitments
from TRL

Description/ Major Components:

Funding and implementation of a (1) short term capital investment program for TRL and (2) provision of
working capital, over a two year period, to secure the operational improvement of TRL under a new
management team to be appointed. The main components of the investment program will be ongoing track
repair and upgrading in specified areas. This will be supported by a complementary program for repair
and refurbishment of TRL wagons and locomotives, with possible leasing of additional equipment as
defined by the approved business plan, which could include any or all of the following options:
 A‐21

• Repair and upgrading of selected units in the existing MLW fleet. (mainline locomotives in South
Africa continue to be upgraded and serviceable beyond the age of fifty years in the case of GM or
GE units)
• Purchase of new locomotives, most likely remanufactured units, up to 2,000 hp, at a cost of about
US$1.5 million each.
• Leasing of locomotives on long term basis, possibly including an agreement on the twenty-five
small Indian locomotives already held, alternatively from other regional railway companies such
as NRZ in Zimbabwe, modified to 1,000 mm gauge, likely to cost up to US$1,200/day on a full
maintenance basis.

The TRL operational wagon fleet should be configured in accordance with the requirements of the revival
business plan. Assuming an initial target of 3 freight train per day, a 7 day train turnaround, and train
lengths of 30 wagons, a fleet of 700 to 800 wagons of the specified types should be available at all times.
There are several options which can be pursued simultaneously and jointly:

• Repair, upgrading and modification of existing wagons, and where appropriate, conversion to
roller bearing axles, and fitting of dual vacuum and air brakes.
• Purchase of new wagons, mainly container wagons or open bulk wagons, at a cost of about
US$50,000 each. Fuel tanker wagons and other special purpose wagons will be more expensive,
and should ideally be linked to specific transport contracts.
• Leasing of wagons on long term basis from other regional railway companies such as NRZ in
Zimbabwe, modified to 1,000 mm gauge, likely to cost up to US$30/day on a full maintenance
basis. Leasing will often promote a higher degree of equipment utilization.
• Encouraging customers to invest in or to supply their own dedicated wagons, to be operated by
TRL, in exchange for a discounted rail tariff

The construction of a new Isaka ICD, capable of handling full TRL unit trains of about thirty wagons in the
initial phases, ideally with loading and unloading of containers by RMGs, alternatively forklifts in the first
phase, provision of large paved container storage areas, equipped with reach stacker(s), truck parking and
access, fueling points (service station), administration block, telecommunications, possible ware housing
and accommodation with cargo distribution and consolidation services. Initial requirement about 10 ha,
phased development (could be similar to the small Kidatu ICD which links the TRL and TAZARA
railways, which was fully equipped, also with ware housing, and a reach stacker). This should be
complimented by an equally efficient rail intermodal terminal in the port of Dar es Salaam.

Critical Factors for Success:

The conditions precedent for the short term capital funding of TRL are (i) that an experienced interim
management team is put in place, with full executive powers, and (ii) that a realistic and bankable business
plan is developed, plotting clear route to the sustainability of the TRL services, including the future
operating structure of TRL.

In respect of the Isaka ICD, the efficient transfer between road and rail is critical for the multimodal service
to be competitive with the alternative all road service. Service contracts should be concluded between TRL,
the ICD operator (if not TRL), and the road haulers. A performance commitment from TRL will be
essential.

Expected Benefits/ Impacts:

The reintroduction of a reliable and cost competitive TRL service will have direct benefits for all the
existing and previous customers of TRL, by reducing transport costs and transit times, and by improving
service predictability. This will lead to increased regional and international trade. It is also expected that
 A‐22

the improved TRL service will initiate a shift of freight from road to rail, resulting in lower road
maintenance costs and improved safety.

A fully equipped and efficiently managed ICD at Isaka will assist TRL to recapture the Rwanda transit
traffic lost to the road services and the Northern Corridor route. The capture of the traffic is very important
for the sustainability of TRL operations. This will in turn benefit Rwanda, parts of Tanzania and DRC for
lower transport cost and reduced road maintenance costs.

Costs and Other Data:

Investment Cost (US$ PPP

Component Start Year Duration million) Potential
TRL Revival – Capital expenditure project for the 2011 2 years 110 Governme
revival of TRL services nt and
donors
TRL Locomotive repair and acquisition 2011 2-3 years 30 Yes
TRL wagon repair, upgrading and acquisition 2011 2-3 years 20 yes
TRL ISAKA Inland Intermodal Container Depot 2011 2 years 25 Yes
(Terminal)
TOTAL 185
 A‐23

No. INFR-RL-02 2013-2016

Name: TRL Track Infrastructure Upgrade – 3-5 years Action Plan Period:
Mode or Subject Area: Rail Intervention Type: Capital, PPP
Corridor: Central Corridor Country(ies): Tanzania
Agencies Involved: TRL, RAHCO, MIOD EIRR: 27%
Related Projects (Donors): TRL Revival Investment, TRL Concession

Background/Rationale:

The TRL railway concession, which operated from 2007 to 2010, was not successful, in that did not achieve
the objectives set out in the concession agreement. The revival of the TRL services is now in the hands of
the Government through RAHCO, with the initial objective of putting in place a new management team,
whose first task will be to prepare a detailed business plan for TRL, which will provide the basis for new
investment to restore TRL to a viable and sustainable business. This first phase of revival will seek to
increase freight traffic volumes from the current 0.5 mtpa level to the previous levels of about 1.5 mtpa,
achieved more than seven years ago – it will mainly be focused on track infrastructure repair and
maintenance in order to improve reliability and reduce train transit and turnaround times. Locomotive and
wagon reliability and availability will also have to be improved, but the financing requirements can be
linked to customer contracts, as has been done on the TAZARA system.

Once the initial two year revival program has been completed, a new commercial operator for TRL will be
sought, most likely a new concession, whose objective will be to further increase traffic volumes,
particularly transit freight and to serve the developing gold and nickel mining sector. Nickel exports could
generate very large rail volumes of imports and exports. The current track TRL infrastructure consists of
long sections of light 30 lb/yard track, mostly in poor condition. The RAHCO action plan presented to the
4th JISR in September 2010, earmarked 330 km of track due for urgent upgrading, including strengthening
of bridges to carry heavier axle loads.

The main objective of the medium term TRL infrastructure upgrade is to replace the entire 30 lb/yard track
with new rails of not less than 40 lb/yard, in order to increase permissible axle loads and the operation of
longer trains at higher speeds. Increased volumes will also bring the need for improved signaling systems.
The proposals for the construction of a new railway line from Isaka to Rwanda and Burundi are seen as a
longer term development, most likely linked to demand from the mining sector for bulk exports – similarly
the proposals for a new standard gauge railway from Dar es Salaam to Isaka. Upgrading of the existing
TRL track could in some sections be carried out with provision for future conversion to standard gauge.

Current Status:

TRL is currently in an interim phase, being managed through RAHCO, but with no access to new
investment funds. It appears that the Government has adopted the approach of appointing a new
management team to prepare a new business plan, which will form the basis of the two year revival
budget. After operations have been ‘stabilized’ and performance has been improved, consideration will be
given to structuring new concession.

Description/ Major Components:

Phased upgrading of the TRL track infrastructure and signaling systems to allow more ‘modern’ and
competitive train service to be operated – axle loads for 18 t to 20 t, longer trains, faster transit and
turnaround times, and greater reliability. In the first instance, this will entail the track infrastructure to be
upgraded with heavier rails and structures to a uniform standard on all the main lines, commencing with
the lines between Dar es Salaam, Mwanza and Kigoma. It is expected that the rail service to Tanga and
Arusha will be reopened and upgraded to the same standard
 A‐24

Critical Factors for Success:

The most critical issue is to develop a new business plan for TRL, to serve as a basis for the initial financing,
but which will be dependent on the appointment of a resourceful, experienced and professional
management team.

Expected Benefits/ Impacts:

The immediate benefit will be the resumption of a reliable and cost competitive rail service, directly
benefitting trade with Burundi, the DRC, Rwanda, and to a lesser extent Uganda. The infrastructure
upgrade will further increase reliability and serve as an additional incentive for the development of the
nickel mining sector in Burundi and north eastern Tanzania. Track upgrading will also allow the transport
of heavy abnormal loads for the mining industry – the cost of road transport of heavy equipment within
Tanzania is presently prohibitive.

Costs and Other Data:

Investment Cost (US$ PPP

Component Start Year Duration million) Potential
TRL Infrastructure Upgrade, longer term, 1600km 2013 ongoing 350 Yes
of mainline Dar Mwanza, Taboro - Kigoma
TOTAL 350 Yes
 A‐25

No. INFR-RL-03 2011-2013

Name: RVR Infrastructure Upgrade – 1-3 years Action Plan Period:
Mode or Subject Area: Rail Intervention Type: Capital, PPP
Corridor: Northern Corridor Country(ies): Kenya / Uganda
Agencies Involved: RVR, Kenya Railways, Uganda Railways EIRR: 22%
Related Projects (Donors): RVR Concession

Background/Rationale:

The Kenyan and Ugandan railway systems are operated jointly by one concessionaire, Rift Valley railways
(RVR), under two separate concession agreements. The RVR concession followed a similar sequential
process to several other railway concessions in eastern and southern Africa:

• decline of the railway services,

• loss of traffic volumes and revenue,
• unsustainable loss-making operations, lack of investment,
• absence of infrastructure and equipment maintenance,
• decision to privatize operations
• lengthy and delayed process of concessioning / privatization, leading to further deterioration of
assets and market
• flawed bidding process – selection of concessionaire
• operations in atmosphere of conflict, delay of investment schedule
• non performance of the concession

In the case of RVR, the original commercial shareholder and operator was unable to revive the operations
of the railway services in the Northern Corridor, which continued to experience unacceptably high levels
of equipment failure and major derailments – traffic volumes remained at low levels. During 2010, a new
resourceful commercial shareholder gained control of RVR, with an initial commitment to invest US$290
million in the first phase of revival, with plan to increase traffic levels three-fold from the current
approximately 1.5 mtpa to 4.5 mtpa.

RVR operates on a meter gauge line with coverage of about 2,735 km in Kenya and approximately 306 km
in Uganda. The revised concession also includes the 501km northern line from Tororo to Pakwach, which
remains inopertional. The poor condition of the track has lead to imposition of temporary speed
restrictions on many sections across the track, resulting in about twenty major derailments per month and
unpredictable transit times.

Current Status:

The agreements relating to the new commercial shareholder in RVR are in place, and the track repair and
upgrading program has commenced in both Uganda and Kenya.

Description/ Major Components:

Initial repair and upgrading of specific sections of poor track in both Uganda and Kenya, which are the
main causes of frequent derailments and restricted operating conditions. The first phase of civil
engineering works, carried out during years 1 to 3, is focused on the following:

(i) Addressing inherited maintenance deficit.

(ii) Programmed ongoing track maintenance activities.
 A‐26

(iii) Planned rehabilitation works for particular sections which require more attention than simple
maintenance program.

The critical issue in the track rehabilitation program is a 30 km section between Mombasa and Nairobi
where rails are worn beyond permissible wear, with damaged sleepers and missing / damaged fittings and
fasteners including ballast deficiency. The estimated cost of repairs in KES 475 million (US$6 million, or
US$200/km). Similarly, there is a critical section of poor track drainage in the Jinja region in Uganda, with
severe speed restrictions and limited train lengths of ten wagons – work on this section has commenced.

Critical Factors for Success:

The key success factor is that the financing is secured and that the initial rehabilitation program is not
delayed. The track rehabilitation programme has been commenced within the initial capital budget of
US$290 million, which includes the provision of funds for the rehabilitation of selected locomotives and
wagons. RVR will require additional financing for track repairs and upgrades through the governments of
Kenya and Uganda, as owners of the infrastructure.

Expected Benefits/ Impacts:

The initial RVR repair program is aimed at achieving the removal of speed restrictions hence increased line
capacity and the reduction of track related accidents and improved safety and efficiency of operations –
improved reliability and transport competitiveness. One of the key objectives is for RVR to be able to
operate trains between Mombasa and Kampala as a scheduled seamless service, without the need to
change locomotives or to shorten train lengths.

Costs and Other Data:

Investment Cost (US$ PPP

Component Start Year Duration million) Potential
Railway track repair and upgrading in Uganda and 2010 3 years 250 Yes
Kenya – 1st phase
TOTAL 250 Yes
 A‐27

No. INFR-RL-04 2014-2016

Name: RVR Infrastructure Upgrade – 3-5 years Action Plan Period:
Mode or Subject Area: Rail Intervention Type: Capital, PPP
Corridor: Northern Corridor Country(ies): Kenya / Uganda
Agencies Involved: RVR, Kenya Railways, Uganda Railways EIRR: 22%
Related Projects (Donors): RVR Concession

Background/Rationale:

Following the initial 3 year progamme for track rehabilitation and upgrades in Kenya and Uganda, focused
on improving reliability, lowering operational costs and increasing traffic level and income, the next phase
of infrastructure upgrades will be necessary in order to increase capacity.

Freight traffic volumes are projected to increase from the current 1.5 mtpa to 4.5mtpa in the short to
medium term, which will be possible by the repair, upgrading and maintenance of the existing
infrastructure and equipment. Kenya and Uganda railways have previously carried freight volumes of this
order, and the 1 to 3 years and the 3 to 5year revival programs, linked with the development of inland
container deports and terminals, should firstly restore reliability of services and market confidence, and
secondly increase the carrying capacity of the rail system. The development of new major resource based
projects within the northern corridor, such as the Ugandan oil sector, expected to commence production in
2011/12, will generate significant additional demand for railway services for both inputs and outputs. It is
possible that the export of crude oil through a new marine terminal at Mombasa or at Lamu, will carried by
rail rather than pipeline, with a demand of up to 150,000 bbl/day or 7 million tpa. This will require a
further increase of capacity through the provision for longer trains and passing loops, and realignment of
some sections. This could also initiate to gradual upgrading of the mainlines to a heavier rail section, and
strengthening of selected structures, to allow for increased axle loads. If and when the Mount Kodo iron
ore deposit in eastern DRC is developed, which could only be viable if very large volumes are transported,
up to 50 mtpa, in order to achieve low unit costs and tariffs, it is likely that a new dedicated rail system will
be developed for this project.

Current Status:

The RVR railway concession in Kenya and Uganda has been restructured with a new commercial
shareholder and the process of revival of the operations to restore the previous capacity of the rail systems
has commenced. The first 1 to 3 year phase is focused on improving reliability and increasing traffic
volumes, and if successful, will be followed by a program to increase capacity. RVR has stated that it is in
discussions with Tullow Oil for servicing the Uganda oil sector development, which could provide the
basis a significant upgrade and expansion of the railway network, initially based on inputs, and later also
on outputs. The RVR railway concession in Uganda has been expanded to include the possible reopening
of the northern rail link to Gulu and Packwach, to serve the oil sector around Lake Albert.

Description/ Major Components:

The second phase of track rehabilitation, focused on increasing capacity, will involve a degree of
upgrading of the track to improve operating speeds and allow for more frequent and longer trains.
Improved signaling will also be necessary. The engineering works will include the replacement of worn
rails, likely in conjunction with upgrading to allow for heavier axle loads, realignment of sections in
difficult topography, and the provision of longer and more frequent passing loops. The program and
specifications will largely be determined by demand, particularly if large anchor customers such as the
Ugandan oil sector freight volumes come to fruition.
 A‐28

Critical Factors for Success:

The success of the first 1 to 3 year phase of track rehabilitation, and the demonstrated ability of RVR to
capture a significant volume of both bulk and intermodal traffic from road. Having improved the reliability
of the RVR services, the second phase of rehabilitation will be focused on increasing the capacity of the
system. This will require additional investments in track improvements by both the concessionaire and
governments.

Expected Benefits/ Impacts:

The overall benefit of upgrading and increasing the capacity of RVR will be the lowering of operational
costs through improved asset utilization, improved profitability for RVR and improved competition with
road services.

Costs and Other Data:

Component Investment Duration Cost (US$ PPP

Start Year million) Potential
Railway track repair and upgrading in Uganda and 2014 2 years 150 Yes
Kenya – 1st phase
TOTAL 150 Yes
 A‐29

No. INFR-RL-05 2010-2013

Name: RVR Locomotive Rehabilitation – 3 years Action Plan Period:
Mode or Subject Area: Rail Intervention Type: Capital, PPP
Corridor: Northern Corridor Country (ies): Kenya
Agencies Involved: RVR, Kenya Railways, Uganda Railways EIRR: 22%
Related Projects (Donors): RVR Concession

Background/Rationale:

RVR inherited thirty-nine mainline (Class 93/94) diesel electric locomotives from KRC, which form the
core of the mainline fleet. These locomotives are North American GE U26Cs, fitted with 2,600 hp engines.
A total of twenty-six were built in 1977 and the remainder in 1987 or later. The bulk of the mainline fleet is
therefore thirty-seven years old, but continues to remain serviceable and suitable for rehabilitation and
upgrading. In southern Africa, many of the mainline locomotives still in service are more than fifty years
old, and continue to be serviceable.

RVR operations have been handicapped by the poor condition of locomotives. Out of the thirty-nine
mainline locomotives inherited from KRC only twenty-five are currently in service with varying degrees of
suspect reliability due to a back log or deferred maintenance. This has lead to a high rate of
locomotive/trains failures in transit. Between January 2009 and August 2009, RVR experienced a total of
579 mainline locomotive failures – more than two per day, mostly due to engine failures.

Daily train targets have been six per day on the Mombasa – Nairobi section, now being revised with a
target of nine trains per day, with four trains planned to transport containers. In order to meet this target
RVR locomotives have been supplemented by locomotives hired from Magadi Soda Company, which
operates their own train of the RVR lines between Magadi and Mombasa.

On the RVR Uganda section between Malaba and Kampala, the mainline locomotives are much smaller,
similar to those used on the TRL system in Tanzania, 1,200 hp. During the 1980’s the Nalukolongo railway
workshop near Kampala were equipped and ungraded through a €40 million program by KfW, and it is
well qualified to carry out full refurbishment of the Uganda locomotives, subject to financing being
available. The longer term objective is to replace the Uganda locomotives with larger units similar to those
operated in Kenya, to allow for seamless railway operations.

Current Status:

The locomotive repair program has been commenced by RVR in both Uganda and Kenya, with the initial
objective of rectifying deferred maintenance and recommencing the standard maintenance programs.

Description/ Major Components:

Repair and upgrading of the existing RVR locomotive fleet in both Kenya and Uganda, in order to achieve
availability of more than 90 percent: A major mainline locomotive overhaul is likely to cost more the
US$0.5 million per unit. A similar program is being implemented for the wagon fleet.
 A‐30

Critical Factors for Success:

Given that the technical skills and workshop facilities are available, the main success criteria are the
securing of the necessary finance, and a commitment to the agreed revival program.

Expected Benefits/ Impacts:

A more reliable and more competitive railway service, with improved asset availability and utilization, and
lower operating costs – leading to increased freight volumes by rail.

Costs and Other Data:

Component Investment Duration Cost (US$ PPP

Start Year million) Potential
RVR Locomotive Rehabilitation 2010 5 years 20 Yes
TOTAL 20 Yes
 A‐31

No. INFR-RL-06 2010-2013

Name: RVR Mombasa Intermodal Yard and Equipment Action Plan Period:
Mode or Subject Area: Rail Intervention Type: Capital, PPP
Corridor: Northern Corridor Country(ies): Kenya
Agencies Involved: RVR, Kenya Railways, Uganda Railways EIRR: 26%
Related Projects (Donors): RVR Concession

Background/Rationale:

It is well known that the modal interface between port and the land services of road and rail is where most
time is lost, and significant additional logistics costs are incurred. This is mainly due to issues of
documentation and customs clearance, but also because of poor interfaces with both road and rail. The rail
facilities at many of the regional container terminals are poor, and the operating procedures have been
partially inherited from the pre-containerization period - access via inefficiently operated marshalling
yards, where trains are stopped, checked and often broken up or retained. Ideally, the intermodal trains
should enter the port directly as a unit, with a detailed manifest of all the containers carried. The rail
sidings at the Mombasa container terminal are 450 m long, capable of handling trains of up to thirty
wagons, with loading and unloading by RMGs (rail mounted gantries). As the mainline track is upgraded,
and the use of vacuum brakes is standardized, with increased traffic volumes, trains of up to fifty wagons
should be allowed for. Conversion to standard gauge will allow much longer trains, but not yet justified by
the traffic volumes. T

he Mombasa container terminal is far too narrow – about 200 m instead of the recommended 500 m –
resulting in terminal congestion and interference between the road and rail services. If the proposed system
of integrated near port ICDs is adopted, then both road and rail mode will became more efficient. With the
planned expansion of the existing container terminal with Berth 19, it appears that the existing rail sidings
can be lengthened to accommodate longer trains. It is important in any new development or conversion of
conventional Berths, that utmost attention is given to the positioning and length of sidings and the
equipment specified. Clearly the layout, positioning and equipment selection for the intermodal rail
sidings at the planned new terminal at Kipevu West must be determined in close liaison with RVR and KR.

Current Status:

RVR have operated unit or block intermodal trains in the past, and intend to reintroduce this for all rail
container services to and from Mombasa. A commitment has been made by KPA to convert existing
general cargo Berths to container terminals, possibly as PPP projects, and also to build the new terminal at
Kipevu West

Description/ Major Components:

The lengthening of the rail sidings at the existing container terminals in conjunction with the extension of
Berth 19, the provision of additional RMGs, and additional terminal equipment – reach stackers, rubber
tired gantries and port tractor - trailer units. If the intermodal rail service is operated as a block or unit
train, with fast loading and unloading times, there should be b]very little requirement for wagon shunting.

Critical Factors for Success:

The key success factor will be the commitment of RVR to operate a unit or block intermodal rail service,
and the ability of RVR to enter into a performance based contract with KPA, or the relevant future operator
 A‐32

Expected Benefits/ Impacts:

The expansion, upgrading and successful operation of the Mombasa RVR intermodal rail terminal will
improve service and, thus, promote rail services, and should assist in shifting both transit traffic and
regional trade from road to rail. This will result in reduction of transport cost due to increased competition

Costs and Other Data:

Component Investment Duration Cost (US$ PPP

Start Year million) Potential
RVR Upgrading of Mombasa Intermodal yard 2010 3 years 20 Yes
TOTAL 20 Yes
 A‐33

No. INFR-RL-07 2010-2013

Name: RVR Kampala ICD Development Action Plan Period:
Mode or Subject Area: Rail Intervention Type: Capital, PPP
Corridor: Northern Corridor Country(ies): Kenya, Uganda
Agencies Involved: RVR, Kenya Railways, Uganda Railways EIRR: 21%
Related Projects (Donors): RVR Concession

Background/Rationale:

The Ugandan and Kenyan railway systems are operated as an integrated railway service by RVR on a
twenty-five year concession basis. The operation of the two systems is controlled by separate agreements,
and is effectively operated as two systems with locomotive and crew changes at the Kenya / Uganda
border. The operation of a truly seamless rail service between Mombasa and Kampala is presently
prevented by the poor condition of sections of the Ugandan track infrastructure, which demands that
lighter locomotives are used with shorter train lengths. In order for RVR to achieve its short term freight
traffic projections of 4.5 mtpa, it will have to capture traffic from road, with a service which is more
competitive with road. Ideally, unit trains should be operated between the terminal points, without the
need to break up the train into shorter units – this will allow fast transit and turnaround times and reduced
operating costs.

However, in most cases rail has the disadvantage of lack of flexibility, and requiring the delivery or pickup
to and from the end customer to be carried out by road. The efficiency of the modal transfer points,
normally located at the inland rail container depot or terminal (ICD), is critical to the competitiveness of
rail. Prior to containerization in the 1970’s, and the deregulation of road transport, it was common practice
for the railway operators to deliver wagons to the customers sidings for loading and unloading. This is no
longer considered operationally viable, because of the resulting low equipment utilization, unless it is a
large customer with fixed consignments or dedicated wagons, and who is willing to pay extra for the
wagon re-positioning service (for example Mukwano in Kampala for their edible oil imports).

The alternative is for the railway operator to have a highly efficient and well equipped container terminal,
including customs services, where containers can be transferred between road and rail quickly and at a low
cost. It is important for the railway operator to turn the unit train around as quickly as possible. The
expansion and upgrading of the Kampala rail ICD is therefore an important part of RVR’s marketing
strategy. Previously, about eight years ago, it was also proposed to develop an ICD at Port Bell, and the
viability of this will depend on how the Lake Victoria container services are operated in future.

Current Status:

It is RVR’s stated intention to expand and upgrade their Kampala ICD as part of their targeting of the
intermodal transit traffic. A similar development or expansion will take place at Nairobi and other major
economic centers served by rail.

Description/ Major Components:

The existing yard is to be expanded and upgraded, with new equipment and longer rail sidings. Rail access
should be directly from the main line and road access should be directly to the key ring roads and
bypasses. Ideally train loading and unloading should be by RMG’s, and yard equipment should be reach
stackers and/or rubber tired gantries. There should be sufficient space for future major expansion – this is
often a short coming of ICDs.
 A‐34

Critical Factors for Success:

The key success factor is the commitment by RVR to operate a reliable and scheduled unit train service to
and from Kampala – the RVR ICD will attract other private sector logistics operators to move closer to the
ICD, to offer distribution, consolidation and warehousing activities. This has happened at other inland
successful rail freight terminals.

Expected Benefits/ Impacts:

The expansion, upgrading and successful operation of the Kampala ICD (rail freight terminal) will directly
promote rail services, and should assist in shifting both transit traffic and regional trade from road to rail. It
implies that services will be improved and costs be lowered form the increased competition. This, and
similar developments elsewhere, is an essential element of the RVR marketing strategy.

Costs and Other Data:

Investment Start Cost (US$ PPP

Component Year Duration million) Potential
Kampala ICD Development 2010 3 years 10 Yes
TOTAL 10 Yes
 A‐35

No. INFR-RL-08 2010-2013

Name: Reconstruction of the Tororo – Gulu – Pakwach Railway Action Plan Period:
Mode or Subject Area: Rail Intervention Type: Capital, PPP
Corridor: Northern Corridor Country(ies): Uganda
Agencies Involved: Uganda Ministry of Transport, Uganda Railways Ltd, RVR EIRR: 24%
RVR railway upgrading, Uganda and Kenya (private sector), oil sector
Related Projects (Donors):
development Uganda.

Background/Rationale:

The northern railway from Tororo in Uganda, through Gulu to Pakwach, was completed in 1964, a total
distance of about 500 km. Due to several periods of conflict in northern Uganda, and the and the decline of
traffic levels, the line was closed, and all freight traffic diverted to road. The security situation in northern
Uganda has improved, and this route now provides the main conduit for international trade with southern
Sudan (more than 200, 000 tpa through Mombasa in Kenya). In addition, the development of the Uganda
oil fields in the region served by the northern railway, and also the development of an oil refinery, will
require significant imports of equipment and materials, and the possibility of crude oil exports of up to an
estimated 7 mtpa by rail. A similar development is taking place on the DRC side of Lake Albert, and the
outcome of exploration appears encouraging, but remains speculative.

Current Status:

The feasibility study for reopening the railway to Gulu and Pakwach has been completed (not yet seen by
the consultants) and the RVR railway concession agreement has been expanded to include the northern
line. Proposals have also been considered by the Ugandan and south Sudanese governments for upgrading
the line from Tororo to Gulu to standard gauge (400 km) and extending the railway from Gulu to Juba in
southern Sudan (250 km), to serve as an alternative route to the proposed Juba to Lamu standard gauge
railway. This is likely to be a long term project, but the reopening of the existing line is considered by the
Ugandan government to be a short term priority.

Description/ Major Components:

Upgrading of the existing northern railway, approximately 500 km, from the current 25 kg/m rail to +40
kg/m track, 20-t axle loads, with possible realignment in sections in order to increase operating speeds.
This will include strengthening of bridges and culverts, lengthening of passing loops, and provision for
later upgrading to a standard gauge specification (three rail system). RVR is the designated operator.
Estimated cost in the region of US$325 mill, depending on the recommendation of the feasibility study. A
similar project, of approximately the same scale, was recently completed in Mozambique with WB support
on a PPP basis. This could be implemented as a phased PPP project.

Critical Factors for Success:

The success of the project will in the first instance depend on the financial and political support from the
Ugandan government, and also the ability of the rail concessionaire to enter into a long term contract with
the key investors in the Uganda oil sector – for both inputs and outputs

Expected Benefits/ Impacts:

Given the location of the initial productive oil wells in the northern region of Lake Albert, the
reconstruction and upgrading of the northern railway is considered essential, and could well provide the
 A‐36

much needed anchor project for the revival of the regional rail transport sector as a whole. It will also
provide improved and lower cost access north west Uganda, with likely political and security benefits, and
will provide an improved trade route with southern Sudan through Nimule.

Costs and Other Data:

Investment Cost (US$ PPP

Component Start Year Duration million) Potential
Reopening and upgrading of the Tororo – Gulu 2011 3 years 325 Yes
Pakwach railway
TOTAL 325 Yes
 A‐37

INFR-RL-09
No. Dar es Salaam Cargo Freight Station – Site Selection, Design 2010-2013
Name: and Project Preparation Action Plan Period:
Mode or Subject Area: Port terminal, road, rail Intervention Type: Capital, PPP
Corridor: Central Corridor Country(ies): Tanzania
Agencies Involved: Tanzania Ports Authority, Ministry of infrastructure Dev, TanRoads WB EIRR: n.a.
Related Projects (Donors): TPA promoted, WB supported with funds

Background/Rationale:

The Tanzania Ports Authority (TPA) has recognized that the operational efficiency of the port of Dar es
Salaam is being adversely affected by both congestion within the port terminals and by road congestion
within the city. The implementation of a system of ICDs within the city has provided a solution to the
problem of port terminal congestion, with resulting improved terminal efficiency, but the problem of city
road congestion remains. In order to further improve the efficiency of the container terminal and to
provide much needed additional space, it has been proposed to develop a system of near port ICDs,
integrated with the port terminal operations, as an extension to the port. The intention is to transfer all
import containers to the integrated ICDs by means of a low cost tractor trailer container shuttle service,
except those containers which are specifically booked on rail (mainly transit traffic).

TPA has proposed to develop a Cargo Freight Station (CFS) in an area called Kisarawe, about 35 km from
the port, and to connect this to the port terminals by dedicated railway shuttle service. The main function
of the CFS is to serve as a road/rail transshipment centre for transit goods, a logistics center to provide
freight consolidation, distribution and container stuffing and de-stuffing services, long term storage, car
storage etc. A key objective is for the CFS to promote the development of a surrounding industrial zone, for
further processing and value adding of exports and imports. Domestic imports will logically be routed
through the integrated ICDs, and rail bound transit traffic will bypass both ICDs and the CFS. In order for
the CFS to serve it’s intended function, it will be necessary to provide a direct connections to the main
transit routes for both road and rail – by road to the Morogoro road, and by rail to the main lines of both
Tazara and TRL. The distances between the road and rail routes vary considerable in relation to the
distance from the port. It is quite apparent that road and rail connections, and also the provision of other
services, will be a very high cost component of the CFS development, and the final chosen location of the
CFS will require to be optimized in respect of infrastructure costs, compared to other economic and
environmental considerations.

Current Status:

The World Bank has supported the concept of establishing a remote CFS at Dar es Salaam by funding a
pre-feasibility study, which was completed in December 2010. However, the proposed site for the CFS as
shown in the study was chosen in fairly arbitrary manner, without a detailed site selection study having
been carried out. The cost estimates for the project, given in the study as US$183 mill, have not been
subjected to an optimization process in respect of site preparation and the provision of transport
infrastructure and other services. A detailed site selection study needs to be carried out, (selection matrix
which includes all influencing factors) prior to finalizing the layout and design of the CFS. This could
possibly be done in conjunction with the issuing of an EOI for the location, design and development of a
CFS, based on the preliminary study, in order to test private sector investor and operator interest in the
project at an early stage. The World Bank has expressed readiness to support appointment of a transaction
advisor for the project.
 A‐38

Description/ Major Components:

The project preparation, including site optimum location and design for the development of a remote
cargo freight station for Dar es Salaam, including the provision for a surrounding industrial development
zone, as PPP project.: This will require coordination within TPA on the main functions of both the ICDs
and CFS, and planning of the shuttle services. Commitments will be required from TRL and TAZARA for
the planned railway connection to the CFS, and from TanRoads for the road connection.

Critical Factors for Success:

The key success factor will be the ability to attract private sector investment for the project. For that reason
the investors should also have an influence on the ideal location of the CFS. Contractual commitments from
TRL, TZARA and TanRoads will also be necessary

Expected Benefits/ Impacts:

The economic benefits of the CFS development will include further decongestion of the port terminals
especially in the long-term, beyond the relief achieved by the current ICD operations and to be further
improved by implementation of the proposed integrated ICDs. The CFS will be connected to the port by a
rail shuttle and this should result in significant decongestion of the city roads because all transit imports,
accounting for about 40 percent of total imports, could either be transported directly from the port by rail,
or be transferred by rail shuttle to the CFS. The CFS should promote the shift from road to rail for container
traffic. The intention is for the CFS to promote industrial development and employment, outside the
congested and built up areas of Dar es Salaam.

Costs and Other Data:

Investment Cost (US$ PPP

Component Start Year Duration million) Potential
Project Preparation for the Development of 2011 2 years 2.0 Yes
Kisarawe CFS, including site selection, design
and the provision of road and rail access, services,
and a future industrial zone
TOTAL 2.0 Yes
 A‐39

No. INFR-RD-01 Action Plan 2010-2013 and

Name: Central Corridor Road Capacity Upgrades Period: 2013-2016

Mode or Subject Area: Road Intervention Type: Infrastructure

Corridor: Central Corridor Country(ies): Burundi, Rwanda, Tanzania
Agencies Involved: EIRR: See below
Related Projects (Donors):

Background/Rationale:

Analysis by Aurecon of road capacities using First Order Network Assessment (FONA) has determined
Level of Service (LOS) for the EAC road network, with indices ranging from A (for best operating
conditions) to F (for worst operating conditions). The best operating conditions entail free flow high
(design) average speeds and able to overtake easily. Analysis was carried out for base and future (2020)
scenarios. Immediate remedial action, in terms of proving additional capacity principally by adding lanes
(e.g. climbing lanes or extra lane(s) for the whole identified length) has been recommended for roads with
LOS E and F. Roads with LOS D and C are to be investigated for remedial action later, estimated from 2014.
The Central Corridor roads that are shown on the list below fall into these categories.

Current Status:

There are already plans to expand capacity of some of roads listed below. However implementation of the
comprehensive program of road capacity upgrades as proposed below needs to be pursued expeditiously
in order to ensure there is adequate capacity for smooth flow of growing traffic and trade along the roads.

Description/ Major Components:

(1) Projects preparation to bankable stage; (2) mobilizing investment; and (3) construction

Critical Factors for Success:

(1) Commitment and ability of the various authorities under which the proposed roads fall to manage
preparation of bankable projects; and (2) availability of finance for project preparation and for actual
construction

Expected Benefits/ Impacts:

Impact will be facilitation or removal of potential impediment to regional trade and economic growth.
Benefits are as indicated in the table below in terms of EIRR for each proposed road section.

Costs and Other Data:

Component Country Invest. Dist. Cost EIRR PPP

Start (km) (US$ % Potential
Year million)
Bujumbura – Gitega Burundi 2011 6 1.1 2 No
Kibungo - Kigali Rwanda 2014 32 6.7 27 No
Dar es Salaam - Mbezi Tanzania 2014 25 5.1 27 No
Dar es Salaam port access bypass (to Mlandizi) Tanzania
2014 75 40.0 95 Yes
New constr.
Dodoma - Arusha (Dodoma feeder) Tanzania 2014 51 8.8 37 No
TOTAL 189 61.7
 A‐40

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 A‐41

No. INFR-RD-02 Action Plan 2010-2013 and

Name: Central Corridor Road Rehabilitation Period: 2013-2016

Mode or Subject Area: Road Intervention Type: Infrastructure

Corridor: Central Corridor Country(ies): Burundi, Rwanda, Tanzania
Agencies Involved: EIRR: See below
Related Projects (Donors):

Background/Rationale:

The condition of the East Africa Northern and Central Corridors road network was comprehensively
assessed in 2010 to determine the level of deterioration of pavement. HDM derived International Road
Indices (IRI) were established for all roads, ranging from 0 (good) to 20 (very poor). Paved roads with
roughness levels between 2 and 6 IRI were classified to be in considerable sound state requiring no
immediate remedial action, but with the assumption that they will receive routine and periodic
maintenance in time to maintain conditions so as not to impact on productive capacity of the road.

Paved roads with roughness levels between IRI 6 and 10 were classified to be approaching severe state or
“warning state”, requiring rehabilitation within next five years. Paved roads with roughness levels above
10 IRI were categorized as being in severe condition, requiring immediate rehabilitation. The Table below
shows Central Corridor roads in the latter two categories, with those in severe condition programmed for
rehabilitation within the following four years and those in warning condition planned for rehabilitation
from 2014.

Current Status:

There are already plans to rehabilitate some of roads listed below. However implementation of the
comprehensive program of road capacity upgrades as proposed below needs to be pursued expeditiously
in order to secure road conditions that will facilitate smooth flow of growing traffic and trade along the
corridors.

Description/ Major Components:

(1) Projects preparation to bankable stage; (2) mobilizing investment; and (3) construction.

Critical Factors for Success:

(1) Commitment and ability of the various authorities under which the proposed roads fall to manage
preparation of bankable projects; and (2) availability of finance for project preparation and for actual
construction.

Expected Benefits/ Impacts:

Impact will be facilitation or removal of potential impediment to regional trade and economic growth.
Benefits are as indicated in the table below in terms of EIRR for each proposed road section.
 A‐42

Costs and Other Data:

Component Country Invest. Dist. Cost EIRR PPP

Start (km) (US$ % Potential
Year million)
Bubanza - Cyangugu/Bukavu Burundi 2011 77 32.3 31 No
Muyinga – Kanazi Burundi 2011 27 18.9 36 No
Kigali - Ruhengeri Rwanda 2014 98 41.2 28 No
Nyamahale - Kigali Rwanda 2014 154 64.7 20 No
Dar es Salaam and surroundings Tanzania 2014 28 19.6 36 No
Isaka and surroundings Tanzania 2014 29 20.3 22 No
Chalinze - Tanga: (Coastal feeder) Tanzania 2014 170 71.4 72 No
Butare - Cyangugu/Bukavu Rwanda 2014 149 62.6 39 No
TOTAL 732 331.0
 A‐43

No. INFR-RD-03 2013-2016

Name: Central Corridor Upgrade to Paved Action Plan Period:
Mode or Subject Area: Road Intervention Type: Infrastructure
Corridor: Central Corridor Country(ies): Tanzania, Burundi
Agencies Involved: EIRR: See below
Related Projects (Donors):

Background/Rationale:

CDS/Nathan Inc, Aurecon and Louis Berger assessment of the East Africa road network has determined
that 3,600 km of regional roads are gravel surface on which vehicles operate with huge economic
consequences (of high cost and consequent lack of facilitation of trade and thus economic growth). In order
to reduce the high economic cost there is need to upgrade them, especially those with relatively high traffic
levels. Among these are 774 km on the Central Corridor. Given the level of traffic on the concerned roads,
there is need to upgrade them in the medium to long term. Consequently, the table below lists roads of 774
km on the Central Corridor that are recommended for upgrade to paved standard from 2014.

Current Status:

There are plans to upgrade some of roads listed below. However implementation of the comprehensive
program of road upgrades from gravel to paved standard as proposed below needs to be pursued timely to
mitigate the economic cost and unlocking further economic opportunities.

Description/ Major Components:

(1) Projects preparation to bankable stage; (2) mobilizing investment; and (3) construction.

Critical Factors for Success:

(1) Commitment and ability of the various authorities under which the proposed roads fall to manage
preparation of bankable projects; and (2) availability of finance for project preparation and for actual
construction.

Expected Benefits/ Impacts:

Impact will be facilitation or removal of potential impediment to regional trade and economic growth.
Benefits are as indicated in the table below in terms of EIRR for each proposed road section.

Costs and Other Data:

Component Country Invest. Dist. Cost EIRR PPP Potential

Start (km) (US$ %
Year million)
Mwanza and surroundings Tanzania 2014 14 11.8 32 No
Biharamulo and surroundings Tanzania 2014 67 46.9 23 No
Bujumbura – Gitega - Muyinga Burundi 2014 149 104.3 63 No
Nyakanazi - Biharamulo Tanzania 2014 72 50.4 21 No
Nzega - Isaka Tanzania 2014 55 38.5 43 No
Dodoma – Kalema (Dodoma feeder) Tanzania 2014 167 116.9 177 No
Iringa - Dodoma (Dodoma feeder) Tanzania 2014 182 127.4 75 No
Kalema - Arusha (Dodoma feeder) Tanzania 2014 68 47.6 115 No
TOTAL 774 543.8
 A‐44

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 A‐45

No. INFR-RD-04 Action Plan 2010-2013 and

Name: Northern Corridor Capacity Upgrades Period: 2013-2016
Mode or Subject Area: Road Intervention Type: Infrastructure
Corridor: Northern Corridor Country(ies): Burundi, Kenya, Uganda, Rwanda
Agencies Involved: EIRR: See below
Related Projects (Donors):

Background/Rationale:

Analysis by Aurecon of road capacities using First Order Network Assessment (FONA) has determined
Level of Service (LOS) for the EAC road network, with indices ranging from A (for best operating
conditions) to F (for worst operating conditions). The best operating conditions entail free flow high
(design) average speeds and able to overtake easily. Analysis was carried out for base and future (2020)
scenarios. Immediate remedial action, in terms of proving additional capacity principally by adding lanes
(e.g. climbing lanes or extra lane(s) for the whole identified length) has been recommended for roads with
LOS E and F. Roads with LOS D and C are to be investigated for remedial action later, estimated from 2014.
The Northern Corridor roads that are shown on the list below fall into these categories.

Current Status:

There are already plans to expand capacity of some of roads listed below. However implementation of the
comprehensive program of road capacity upgrades as proposed below needs to be pursued expeditiously
in order to ensure there is adequate capacity for smooth flow of growing traffic and trade along the roads.

Description/ Major Components:

(1) Projects preparation to bankable stage; (2) mobilizing investment; and (3) construction.

Critical Factors for Success:

(1) Commitment and ability of the various authorities under which the proposed roads fall to manage
preparation of bankable projects; and (2) availability of finance for project preparation and for actual
construction.

Expected Benefits/ Impacts:

Impact will be facilitation or removal of potential impediment to regional trade and economic growth.
Benefits are as indicated in the table below in terms of EIRR for each proposed road section.

Costs and Other Data:

Component Country Invest. Dist. Cost EIRR PPP

Start (km) (US$ % Potential
Year million)
Bujumbura - Kayanza Burundi 2011 8 1.6 7 No
Athi River Sorroundings Kenya 2011 16 6.5 56 No
Eldoret - Bungoma Kenya 2011 104 14.5 117 No
Molo - Eldoret Kenya 2011 127 17.7 157 No
Mombasa - Voi Kenya 2011 57 9.9 189 No
Voi - Kitui Rd Junction Kenya 2011 135 18.8 239 No
Fort Hall - Embu - Isiolo: (Moyale- No
Kenya 2011 99 17.3 42
Dodoma Spur)
Fort Hall - Nyeri: (Moyale- Dodoma Spur) Kenya 2011 40 8.3 23 No
 A‐46

Component Country Invest. Dist. Cost EIRR PPP

Start (km) (US$ % Potential
Year million)
Kajiado - Namanga - Arusha: (Moyale- No
Kenya 2011 32 6.7 76
Dodoma Spur)
Thika - Garissa: (Fe (Moyale- Dodoma No
Kenya 2011 27 7.6 31
Spur)
Bungoma/Eldoret Rd junction - No
Kenya 2011 41 8.4 22
Kakamega: (Lokichogio Spur)
Eldoret - Kitale: (Lokichogio Spur) Kenya 2011 53 9.1 40 No
Kakamega - Kisumu: (Lokichogio Spur) Kenya 2011 49 10.3 27 No
Kisii and surroundings: (Lokichogio Spur) Kenya 2011 166 23.2 31 No
Kisumu and surroundings(Lokichogio No
Kenya 2011 46 9.5 26
Spur)
Kitale and surroundings (Lokichogio Spur) Kenya 2011 21 4.3 22 No
Kampala - Masaka - Mbarara Uganda 2011 104 19.1 53 No
Kampala & surroundings (50 percent Jinja- No
Uganda 2011 81 14.1 45
Kampala):
Tororo - Bugiri - Jinja Uganda 2011 31 6.3 47 No
Kakamega - Kitale (Lokichogio spur) Kenya 2014 42 8.8 37 No
Byumba - Kigali Rwanda 2014 27 5.6 20 No
Kakitumba and surroundings Rwanda 2014 28 5.7 34 No
Jinja - and surroundings Uganda 2014 5 1.2 16 No
TOTAL 1,339 234.5
 A‐47

No. INFR-RD-05 Action Plan 2010-2013 and

Name: Northern Corridor Road Rehabilitation Period: 2013-2016

Mode or Subject Area: Road Intervention Type: Infrastructure

Corridor: Northern Corridor Country(ies): Tanzania, Kenya, Uganda
Agencies Involved: EIRR: See below
Related Projects (Donors):

Background/Rationale:

The condition of East Africa Northern and Central Corridors road network was comprehensively assessed
in 2010 to determine the level of deterioration of pavement. HDM derived International Road Indices (IRI)
were established for all roads, ranging from 0 (good) to 20 (very poor). Paved roads with roughness levels
between 2 and 6 IRI were classified to be in considerable sound state requiring no immediate remedial
action, but with the assumption that they will receive routine and periodic maintenance in time to maintain
conditions so as not to impact on productive capacity of the road.

Paved roads with roughness levels between IRI 6 and 10 were classified to be approaching severe state or
“warning state”, requiring rehabilitation within next five years. Paved roads with roughness levels above
10 IRI were categorized as being in severe condition, requiring immediate rehabilitation. The Table below
shows Northern Corridor roads in the latter two categories, with those in severe condition programmed for
rehabilitation within the following four years and those in warning condition planned for rehabilitation
from 2014.

Current Status:

There are already plans to rehabilitate some of roads listed below. However implementation of the
comprehensive program of road capacity upgrades as proposed below needs to be pursued expeditiously
in order to secure road conditions that will facilitate smooth flow of growing traffic and trade along the
Northern Corridor.

Description/ Major Components:

(1) Projects preparation to bankable stage; (2) mobilizing investment; and (3) construction.

Critical Factors for Success:

(1) Commitment and ability of the various authorities under which the proposed roads fall to manage
preparation of bankable projects; and (2) availability of finance for project preparation and for actual
construction.

Expected Benefits/ Impacts:

Impact will be facilitation or removal of potential impediment to regional trade and economic growth.
Benefits are as indicated in the table below in terms of EIRR for each proposed road section.
 A‐48

Costs and Other Data:

Invest. Dist. Cost EIRR

Start (km) (US$ % PPP Potential
Component Country Year million)
Mwanza - Sirari/Kisii: Rehabilitation Tanzania 2011 239 100.4 38 No
Kisumu - Kakamega:(Lokichogio spur) Kenya 2014 94 39.5 36 No
Tororo - Jinja: Rehabilitation Uganda 2014 151 63.4 120 No
Kampala - Kabale: Rehabilitation Uganda 2014 380 159.6 74 No
TOTAL 864 362.9
 A‐49

No. INFR-RD-06 Action Plan 2010-2013

Name: Northern Corridor Upgrade to Paved Period:
Mode or Subject Area: Road Intervention Type: Infrastructure
Corridor: Northern Corridor Country(ies): Burundi
Agencies Involved: EIRR See below
Related Projects (Donors):

Background/Rationale:

CDS/Nathan Inc, Aurecon and Louis Berger assessment of the East Africa road network has determined
that 3,600 km of regional roads are gravel surface on which vehicles operate with huge economic
consequences (of high cost and consequent lack of facilitation of trade and thus economic growth). In order
to reduce the high economic cost there is need to upgrade them, especially those with relatively high traffic
levels. Among these are 319 km on the Northern Corridor. Given the level of traffic on the concerned roads,
there is need to upgrade them in the medium to long term. Consequently, the table below lists roads of 319
km on the Northern Corridor that are recommended for upgrade to paved standard from 2014.

Current Status:

There are plans to upgrade some of roads listed below. However implementation of the comprehensive
program of road upgrades from gravel to paved standard as proposed below needs to be pursued timely to
mitigate the economic cost and unlocking further economic opportunities.

Description/ Major Components:

(1) Projects preparation to bankable stage; (2) mobilizing investment; and (3) construction.

Critical Factors for Success:

(1) Commitment and ability of the various authorities under which the proposed roads fall to manage
preparation of bankable projects; and (2) availability of finance for project preparation and for actual
construction.

Expected Benefits/ Impacts:

Impact will be facilitation or removal of potential impediment to regional trade and economic growth.
Benefits are as indicated in the table below in terms of EIRR for each proposed road section.

Costs and Other Data:

Invest. Dist. Cost EIRR

Start (km) (US$ % PPP Potential
Component Country Year million)
Bujumbura -Gitega – Muyinga Burundi 2011 149 104.3 63 No
Nairobi and surroundings Kenya 2014 56 23.5 117 No
Nakuru- Londiani Kenya 2014 114 15.9 108 No
TOTAL 319 143.7
 A‐50

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 A‐51

No. INFR-L-01 2010-2013

Name: Lake Ports Rehabilitation, Dredging and Siltation Protection Action Plan Period:
Mode or Subject Area: Lakes Intervention Type: Infrastructure
Northern and Central Country(ies): Burundi, Kenya, Tanzania, Uganda and DRC
Corridor: Corridors
Agencies Involved: Ports Authorities, Government Ministries of Transport EIRR: 34%
Related Projects (Donors): Belgium

Background/Rationale:

Historically inland waterways on Lake Tanganyika have played an important role in proving least cost,
most efficient and reliable means of transport for goods to/from Burundi, Eastern DRC and western
Tanzania, as an important component of an intermodal supply chain along the Central Corridor linking
these countries to Dar es Salaam port through Kigoma. Similarly inland waterways on Lake Victoria
provided an important link for the Central and Northern Corridor transport intermodal system links to
especially Uganda. In this way the Lake provided Uganda with an alternative access route to the sea.

This importance has declined due mainly to backlog maintenance or lack of investments in the ports and
marine infrastructure. Insecurity on Lake Tanganyika and the decline in performance of rail links to
Kigoma, Mwanza and Kisumu has also denied the lake services with traffic that would have motivated
such investment. Many ports are severely silted, with depths at Berths reduced to around 3-4 m. Port
facilities have also deteriorated. However, with better prospects of economic growth in the region, it is
important that these links are revived and strengthened. Investment in rehabilitating and improving Lake
ports infrastructure and shipping services will be beneficial to the region.

Since traffic is low and needs to develop, it is proposed that initially a relatively cheaper tug and barge
based roll on roll off (RoRo) system should be developed on both lakes to provide necessary capacity until
cargo traffic builds up to justify more expensive lift on lift off system.

Current Status:

Dredging at some ports on Lake Tanganyika and Victoria has been done or is ongoing, with own funding
(TPA) and assistance from Belgium. There are two major initiatives the Lake Victoria Basin Commission
(LVBC) and the Lake Tanganyika Basin Commission (LTBC) that are ongoing and have established
comprehensive investment strategies. In this an investment conference for LBVC was held in Mwanza on
mobilizing finance for implementation.

Description/ Major Components:

(1) Complete or initiate dredging of ports of especially Kigoma, Bujumbura, Kalemie, Mwanza, Port Bell,
and Kisumu to restore design depths of generally around 6 m on approach to, in anchorage and along
Berths. (2) Establish a watercourse management system to minimize soil erosion and sedimentation at
ports and (3) rehabilitating or establishing of areas and ramps to accommodate vehicles (in particular
MAFI trailers and forklifts) involved with RoRo operations at ports.

Critical Factors for Success:

(1) Redevelopment of railways links to Kigoma, Mwanza and Kisumu to entice shippers; (2) Governments
of especially Tanzania, Kenya, Uganda, Burundi (and DRC) commitment to invest or mobilize finance for
investment and (3) establishing suitable condition to allow PPP especially private sector investment in
provision of Lake services..
 A‐52

Expected Benefits/ Impacts:

(1) Providing opportunity to reduce transport/trade cost with the use of least cost links for especially for
Burundi, part of Eastern DRC and Uganda; (2) Providing viable alternative trade routes for countries using
the Lake services to avoid propensity to exploit monopoly situations,

Costs and Other Data:

Investment Cost (US$ PPP

Component Start Year Duration million) Potential
Dredging and sedimentation protection at
ports of Bujumbura, Kigoma, Kalemie, 2010 30 months 8 No
Mwanza, Port Bell and Kisumu
Rehabilitate or construct Ports
infrastructure facilities (paved storage 2011 24 months 6 Yes
areas, ramps etc) to handle RoRo services
TOTAL 14 Yes
 A‐53

No. INFR-L-02 2010-2013

Name: Provision of RoRo Services on Lakes Tanganyika and Victoria Action Plan Period:
Mode or Subject Area: Lakes Intervention Type: Infrastructure
Northern and central Country(ies): Burundi, DRC, Kenya, Uganda and Tanzania
Corridor: Corridor
Agencies Involved: Private Sector Lakes Service Providers, Lakes Ports Authorities, EIRR: 28%
Governments, Regulators
Related Projects (Donors):

Background/Rationale:

In the course of revival of inland waterway services on Lakes Tanganyika and Victoria to service increasing
volume of cargo, it has been proposed to initially adopt a tug and barge based RoRo services. These would
be quicker and relatively less costly to establish. Typically a tug and barge system also requires about a
third of the crew compared to a self propelled vessel. Furthermore, barges can be built at low technology
shipyards on the lakes, tugs can be bought and railed to the lakes, MAFI trailers can be assembled and
fabricated locally and forklifts can be bought from local franchises.

Current Status:

There are some private sector operated barges on both Lake Tanganyika and Victoria. Barges can be built
at existing shipyards at some ports on both lakes, albeit with some slight improvement if need be.

Description/ Major Components:

(1) Mobilizing private sector, especially those involved in provision of lake services, to buy into and
establishing RoRo services; (2) acquisition of barges by fabrication at local shipyards, MAFI trailers also
fabricated locally and importation of tugs.

Critical Factors for Success:

(1) Private Sector being convinced the RoRo services are good business; (2) Availability of appropriate port
infrastructure to service RoRo traffic and (3) a requisite regulatory environment to allow fair competition
among service providers.

Expected Benefits/ Impacts:

(1) Provision of transport capacity on the lakes quickly; (2) provision of an opportunity to reduce transport
and trade cost in the Great Lakes region by exploiting relatively cheaper inland waterways.
 A‐54

Costs and Other Data:

Investment Duration Cost (US$ PPP

Component Start Year million) Potential
Acquisition of barges, tugs, MAFI
trailers and fork-lifts and operate
2011 24 months 15 Yes
RoRo services on Lakes Tanganyika
and Victoria
Yes but
Support process to promote and
mostly
facilitate establishment of RoRo
2011 24 months 0.4 public/
services on Lakes Tanganyika and
donor
Victoria
finance
TOTAL 15.4 Yes
 A‐55

No. INFR-L-03 2010-2013

Name: Restructuring Wagon Ferries to Carry MAFI Trailers Action Plan Period:
Mode or Subject Area: Lakes Intervention Type: Infrastructure
Northern and Central Country(ies): Kenya, Uganda and Tanzania
Corridor: Corridors
Agencies Involved: RVR, RAHCO/TRL. TMSC and Lake Ports authorities EIRR: 28%
Related Projects (Donors):

Background/Rationale:

Principal cargo transport services on Lake Victoria were designed as part of a railway system, with wagon
ferries carrying wagons across the Lake. Link spans were built at all major ports Mwanza, Kemondo Bay
and Musoma in Tanzania, Kisumu in Kenya and Jinja and Port Bell in Uganda to facilitate rolling wagons
on/off the ferries. When the railways were performing well the wagon ferries had an important role to
provide an important transport link for both Northern and Central Corridors. However, with the near
collapse of the railways in recent years the importance and use of wagon ferries declined and the ferries
received no proper maintenance.

Out of the five ferries commissioned between 1964 and 1979, only four are serviceable or operational since
the sinking of one (Ugandan) in 2005 after collision with a sister ferry. Two (Tanzanian and Kenyan) are
operational and the remaining two (Ugandan) are being rehabilitated to be put back to service. This RoRo
service is simple to operate and available to use, though some facilities at ports need rehabilitation.
However, there is need to reduce the high cost of maintenance and operations of the ferries relative to their
carrying capacity. They now carry nineteen wagons (38 TEU).

A 2009 analysis by Marine Logistics Limited for the Central Development Corridor determined the
possibility of the ferries accommodating 62 TEU, an additional 24 TEU on MAFI trailers and on deck,
without changing the structure of the vessel. There is a possibility to further improve this capacity by
adjusting the superstructure to make the ferry more flexible, with ability to carry a full load of MAFI
trailers when there are wagons to ferry. In addition the MAFI trailers have a tare weight of around five
tonnes compared to seventeen tonnes for the wagons.

Current Status:

There are no known existing plans to convert the wagon ferries.

Description/ Major Components:

(1) The first part will be to carry out a technical feasibility analysis of the conversion, especially related to
stability and safety standards; and (2) carrying out the conversions at local shipyards.

Critical Factors for Success:

(1) The first factor will be establishing technical feasibility (although some experts have suggested
feasibility); and (2) acceptance by the owners and operators of the wagon ferries to convert them and
provide broader, flexible and potentially more competitive RoRo services.

Expected Benefits/ Impacts:

The main advantage is better utilization of the wagon ferries and, thus, potential reduction of operational
cost.
 A‐56

Costs and Other Data:

Investment Duration Cost (US$ PPP

Component Start Year million) Potential
Analysis of technical feasibility of 2011 16 months 7 Yes
converting wagon ferries to carry MAFI
trailers and actual conversion of four
wagon ferries
TOTAL 7 Yes
 A‐57

No. INFR-TF-01 2010-2013

Name: One Stop Border Post Facilities Design and Construction Action Plan Period:
Mode or Subject Area: Transit Facilitation Intervention Type: Infrastructure
Northern and Central Country(ies): Burundi, DRC, Kenya, Uganda and Tanzania
Corridor: Corridor
Agencies Involved: All border control agencies EIRR: 22%

Related Projects (Donors): JICA, Trademark East Africa/DfID, USAID/Compete.

Background/Rationale:

The East African Community has made a commitment to reducing the time spent at borders and inland
clearance by introducing One Stop Border Posts. The objective of a One Stop Border Post (OSBP) is to
enhance trade facilitation by reducing the number of stops incurred in a cross border trade transaction by
combining the activities of both countries’ border organizations at a single location with simplified
procedures and joint processing and inspections, where feasible. It is also designed to reduce on the time
taken to clear passengers at the border.

Current Status:

A number of projects are carrying out feasibility studies and engineering design for OSBP facilities on the
Northern and Central Corridors.

• At Malaba, the busiest border on the Northern Corridor, several donors have been involved in
designing OSBP including USAID, World Bank and DfID.
• At Gatuna/Katuna on the Uganda/Rwanda border and Mutukula on the Uganda/Tanzania
border OSBP design and construction is being supported by the World Bank as part of the East
Africa Trade and Transport Facilitation Project. While procurement is done nationally, Bilateral
Committees have been working to coordinate engineering design and procedures to insure
harmonization between the juxtaposed facilities.
• At Akinyaru/Kinyaru Haut between Rwanda and Burundi, the African Development Bank is
funding a feasibility study under the East Africa Trade and Transport Facilitation Project.
• At Rusumo on the Tanzania/Rwanda border, JICA is in final approval for financing a new bridge
and OSBP border posts.
• At Kobero/Kabanga on the Burundi/Tanzania border, Trade Mark East Africa is financing a
feasibility study and engineering design for an OSBP. A full Inception Report was presented to all
stakeholders on April 4, 2011.
• At Kagitumba/Mirama Hills, with TMEA support, the Inception Report is completed and has
been presented to stakeholders; plans have been approved; the Design and Supervise contract was
awarded to TRIAD Architects; a workshop with stakeholders and the architect was held and a
report of that meeting circulated.
• At Tunduma, with TMEA support, the Inception Report was completed and presented to
stakeholders; the plans were approved in principle. The next step is for approval to go to the
Expression of Interest stage

These projects mean that the facilities will have been designed for all the key borders on the Northern and
Central Corridors and the construction for facilities is funded for the first three. Other border posts that are
candidates for OSTB facilities include:

• Cyanika - The road to Cyanika has been completed and both Uganda and Rwanda are keen to see
this utilised as it shortens the route to Gyseni/Goma (DRC). This would reduce the volume of
traffic currently going through Katuna to Kigali with onward transit to Gyseni. A feasibility/needs
assessment stud is required.
 A‐58

• Cyangugu (Ruisizi 1)- The Cyangugu border posts with the DRC are important posts leading into
Bukavu. This is a good opportunity to work with the DRC to reopen trade at the end of Lake Kivu.
All parties want Cyangugu reopened into Bukavu (also known as Rusizi 1). DRC has plans to
extensively re-structure Rusizi 1 but space is a problem and the plans show extensive re-settlement
will be required to widen the road to the border. Traffic demand does not appear to support this
extensive re-working, including a new larger bridge. However, replacing the existing single lane
road bridge with a simple two lane bridge and some minor works on both the Rwanda and DRC
side would enhance local cross border traffic and offer an alternative route into Bakavu for light
and medium size trucks.
• Rusizi 2 (DRC) - which is currently used for heavy traffic entering DRC. Extra distance for
transport of goods destined for Bukavu. Moreover, there is more potential to develop Rusizi 2 for
heavy traffic. The DRC have started to rebuild office accommodation for all border agencies but
little is planned to alleviate traffic congestion. There is the possibility of sharing facilities on both
sides of the border. Shared office facilities on the DRC site and shared vehicle inspection facilities
on the Rwanda side.
• Mutukula –Land issues have been sorted out land issues and EOI out for Design and Supervise
contract. Consider incorporation in final design pre-fabricated facility, especially the HVIF. The
Tanzanian side has completed the Design and Supervise tendering and has approved working
drawings. This project is now already out to construction tender with WB support.
• Mpondwe - This is an important crossing from Uganda into DRC. Recent FIAS studies show that
traffic (including heavy vehicles is increasing) with both exports and imports. Some remedial work
has been carried out locally by both Governments. AFDB have completed architectural design
phase and are awaiting funding approval to start construction.

Description/ Major Components:

Design and construction of OSBP facilities and ancillary road improvements at an average cost of US 10
million per facility.

Critical Factors for Success:

For implementation of OSBP to be successful, all the components should be coordinated and synchronized:
legal framework, appropriate engineering design and traffic flow, simplified procedures and ICT
applications to enable electronic transfer of information, payments etc. Failure to carry out any of them
effectively will diminish the benefits achieved. ICT connectivity needs to be established early in the
development process, so that applications can be developed, tested and training completed in advance of
the border opening. Commitment from all border agencies is also critical to success.

Expected Benefits/ Impacts:

Where they have been implemented they have cut the time of processing pedestrians and passengers in
cars, minivans and buses by half. Substantial time savings for cargo has been achieved depending on the
treatment of compliant clients. Time savings result in considerable vehicle operating cost savings.

Costs and Other Data:

Investment Duration Cost (US$ PPP

Component Start Year million) Potential
Design and construction of OSBP
facilities and ancillary road 2011 24 months 110 Yes
improvements
TOTAL 110 Yes
 A‐59

OPER-RD-01
No. Develop Northern Corridor Road Maintenance Contracting 2010-2013
Name: System Action Plan Period:

Mode or Subject Area: Road Intervention Type: Operation

Corridor: Northern Corridor Country(ies): Kenya, Uganda, Rwanda and Burundi
Agencies Involved: Ministry responsible for Roads (Kenya, Uganda, Rwanda, Burundi), Road Agencies/
Authorities
Related Projects (Donors):

Background/Rationale:

The condition of the Northern Corridor road network has passed through cycles including periods of good
condition, after rehabilitation with support of development partners, back to poor condition needing
another round of rehabilitation. The main reason for deterioration of the roads, after periods of
rehabilitation or upgrading, has been mainly deferred maintenance due to inadequate financing and
reported rampant overloading. An appropriate management needs to be established to ensure adequate
maintenance is provided on time.

As regards maintenance, the Governments in whose countries the core Northern Corridor road network
traverses (Kenya, Uganda, Rwanda and Burundi), have established dedicated Road Funds in order to
ensure availability of finance to ensure adequate and timely routine and periodic maintenance. However,
there are still gaps in funding due to large demand, which compete for financing from the Road Funds. In
respect of overloading, Kenya and Uganda the Highway Authorities are responsible for weighbridges. The
exception is the Mariakani weighbridge (near Mombasa) in Kenya, which has been contracted to a private
operator. If contraventions are detected, prosecution are instituted (there is no option to pay admission of
guilt fines and vehicles are impounded until a court has issued judgment). There have been complaints of
ineffectiveness of the system to curb overloading and the soliciting of “unofficial” payments at the
weighbridges. However, improvements are being made or are planned.

In order to ensure that roads receive regular maintenance as required, a proposal has been made that the
core corridor roads be put under long term performance based contract. The contract would include the
requirement to keep the roads at an agreed level of condition, including ensuring that roads are not
damaged due to overloading. Financing of the contract will be from a combination of sources including
road public funds (from Road Fund/Government and, in some cases, possible tolling). However, this will
not apply for some sections, which may be transformed to full “toll roads”, given their very high level of
traffic with commercial viability.

Current Status:

Roads are managed by Road Agencies/Authorities and maintained on contract for specific works defined
such as routine maintenance, re-sealing/periodic maintenance. Finance is from Road funds and
Government budget allocation. When there is no finance, maintenance is postponed, thus accumulating
deferred maintenance and accelerated road deterioration. Overload control is managed by the Road
Authorities in Kenya (KenHA) and Uganda via weighbridges. Rwanda and Burundi are in the process of
establishing weighbridges at and similar vehicle overload control systems.

Description/ Major Components:

(1)- An assessment to identify technical, legal, institutional, finance and methodological frameworks and
approaches to implement long term contracts, as well as to define possible packages/sections to be put
 A‐60

under such contract; (2) Transaction Advisory services to structure identified possible contracts, prepare
RFPs and assist with procurement of maintenance contractors.

Critical Factors for Success:

(1)- Positive assessment/feasibility study results; (2) commitment of Government to implement such
contracts; and (3) commitment to provide finance according to contracts during the duration of the
contract.

Expected Benefits/ Impacts:

Well maintained road and reduced vehicle operation costs due to good condition of roads; (2) maintenance
of road financing to optimum level due to timely maintenance as opposed to higher rehabilitation cost
required when maintenance is deferred and roads there is accelerated damage of the roads; (3) more
efficient management of the roads, including overload control.

Costs and Other Data: (The table below may be one row for a single intervention or multiple rows if
needed to list discrete projects that were grouped into a single action plan intervention.

Investment Duration Cost (US$

Component Start Year million)
Assessment of long term maintenance 2011 6 months 0.1
possibilities of Northern corridor roads
Transaction advisory services to structure 2011 18 months 0.9
contracts and procure contractor(s)
Total 1.0
 A‐61

OPER-RD-02
No. Develop Central Corridor Road Maintenance Contracting 2010-2013
Name: System Action Plan Period:

Mode or Subject Area: Road Intervention Type: Operations

Corridor: Central Corridor Country(ies): Tanzania, Rwanda and Burundi
Agencies Involved: TANROADS, Ministry responsible for Roads (Tanzania, Rwanda, Burundi)
Related Projects (Donors):

Background/Rationale:

The Central Corridor road network has in the last decade been significantly improved, with the upgrading
to paved standard of more than 500 km in Tanzania and rehabilitation of another similar distance. An
appropriate management needs to be established to ensure adequate maintenance is provided on time.
However, in the past management of the paved and unpaved sections of the Central Corridor roads has
been in cycles including periods of good condition, after rehabilitation with support of development
partners, back to poor condition needing another round of rehabilitation. The main reason for deterioration
of the roads after periods of rehabilitation or upgrading has been mainly deferred maintenance due to
inadequate financing. Overloading has also been a factor, causing accelerated deterioration of the roads.

As regards maintenance, the Governments in whose countries the core Central Corridor road network
traverses (Tanzania, Rwanda and Burundi), have established dedicated Road Funds in order to ensure
availability of finance to effect adequate and timely routine and periodic maintenance. However, there are
still gaps in funding due to large demand, which compete for financing from the Road Funds. In respect of
overloading, Tanzania has adopted and is implementing a regional (SADC) strategy based on
administrative penalties that aim to recover the actual costs of road damage. There is general appreciation
of an effective enforcement in Tanzania although the time taken is high since transit traffic vehicles have to
be weighed at 9 weigh-stations in Tanzania, instead of the ideal two, one at departure and another at exit.
There are also complaints of officials delaying the process and involvement with soliciting and receiving
“unofficial” payments.

In order to ensure that roads receive regular maintenance as required, a proposal has been made that the
core corridor roads be put under long term performance based contract. The contract would include the
requirement to keep the roads at an agreed level of condition, including ensuring that roads are not
damaged due to overloading. Financing of the contract will be from a combination of sources including
road public funds (from Road Fund/Government and, in some cases, possible tolling).

Current Status:

Roads are managed by Road Agencies/Authorities and maintained on contract for specific works defined
such as routine maintenance, re-sealing/periodic maintenance. Finance is from Road funds and
Government budget allocation. When there is no finance, maintenance is postponed, thus accumulating
deferred maintenance and accelerated road deterioration. Long-term contracting has been adopted on a
pilot basis for some gravel roads in Tanzania. Overload control is managed by the Road Agency
(TANROADS in Tanzania) via weighbridges. Rwanda and Burundi are in the process of establishing
weighbridges at and similar vehicle overload control systems.

Description/ Major Components:

(1)- An assessment to identify technical, legal, institutional, finance and methodological frameworks and
approaches to implement long term contracts, as well as to define possible packages/sections to be put
 A‐62

under such contract; (2) Transaction Advisory services to structure identified possible contracts, prepare
RFPs and assist with procurement of maintenance contractors.

Critical Factors for Success:

(1)- Positive assessment/feasibility study results; (2) commitment of Government to implement such
contracts; and (3) commitment to provide finance according to contracts during the duration of the
contract.

Expected Benefits/ Impacts:

Well maintained road and reduced vehicle operation costs due to good condition of roads; (2) maintenance
of road financing to optimum level due to timely maintenance as opposed to higher rehabilitation cost
required when maintenance is deferred and roads there is accelerated damage of the roads; (3) more
efficient management of the roads, including overload control.

Costs and Other Data: (The table below may be one row for a single intervention or multiple rows if
needed to list discrete projects that were grouped into a single action plan intervention.

Investment Duration Cost (US$

Component Start Year million)
Assessment of long term maintenance 2011 6 months 0.1
possibilities of Central Corridor roads
Transaction advisory services to structure 2011 18 months 0.9
contracts and procure contractor(s)
TOTAL 1.0
 A‐63

No. OPER-RL-01 2010-2013

Name: Procure and Retain TRL Management Team – 2 years Action Plan Period:
Mode or Subject Area: Railway Intervention Type: Technical Assistance
Corridor: Central Corridor Country(ies): Tanzania
Agencies Involved: Ministry of Infrastructure Dev, RAHCO, TRL
Related Projects (Donors): Revival of TRL operations, WB funds set aside

Background/Rationale:

The Tanzania Railways Limited (TRL) serves the land locked countries of Uganda, Rwanda, Burundi and
parts of eastern DRC. Traditionally the system carried between 1.2 mtpa and 1.5 mtpa, but in the past six
years traffic has fallen to below 0.5 mtpa due to a series of specific events: (i) lack of investment and poor
performance of the railways over the period, (ii) the suspension of the Ugandan rail ferry service; (iii) the
2009 flood damage, causing a six month service suspension, and (iv) the failure of the concession with
Rites, operating as TRL. The TRL service is particularly critical for Burundi, because it previously carried
all Burundi’s international trade, which is now routed via a much longer and more expensive road route.
The same applies to trade with the eastern DRC through the lake ports of Kigoma and Kalemie.

The TRL service also provides the shortest distance to any port from Rwanda, and the decline of the lake
and rail service has resulted in Rwandan transit traffic being shifted from the Central to the Northern
Corridor, at additional cost. As a result of the failed concession, the budget allocated for the revival of the
system is no longer available. Urgent outside assistance is needed. However, there appears to be little
possibility to attract such financial support without ensuring that there are sufficient conditions to ensure
value for money. One of the key conditions is a good business plan and a fully experienced and
accountable management to implement the plan. Such a management is likely to be a combination of local
experts, supported by an experienced and well technically resourced team from a reputable international
railway company, with experience of turning around railways and managing successful or profitable
railways.

Current Status:

TRL is currently in an interim stage, being managed through RAHCO, with TRL staff salaries being
guaranteed by government, but TRL being responsible for all other operating costs. RAHCO has sought
financial support through government for a total investment of US$90 million in track repair and upgrades
in the first 3 years. There appears to be no possibility for funding future TRL operations without the
preparation of a detailed, realistic and credible business plan, which is focused on core business, linked to
increasing freight traffic volumes. At the present time, TRL is unable to serve major new customers without
additional up front funding to improve the performance of both infrastructure and equipment.

Description/ Major Components:

Phase 1 : Preparation of the TOR for a performance based management contract, working jointly with The
MOID and RAHCO, motivation of funding for the management contract (estimated at US$2 million over
two years), preparation of tendering process, prequalification, adjudication, preparation of management
contract and appointment of management contractor. Technical assistance required, assumed funded by
RAHCO with indicated WB support.

Phase 2 : Retain TRL management team for a period of two years, management the operation of TRL,
prepare detailed business plans, including cash flows and financing schedule, presentation of business
plan to secure funding, prepare and implement marketing plan to target intermodal sector and increase
 A‐64

freight levels. Study option for future operational structure for TRL and prepare contracts for operating
concession. The cost of the management contract will require institutional funding through government,
est. US$2 million.

Critical Factors for Success:

The closure of the TRL railway service is not considered to be a politically acceptable or realistic option – it
could have severe negative economic consequences for the land locked countries. The necessary capital
cannot be raised without improved management and a credible business plan. The crucial success factor is
therefore the urgent appointment of an experienced management team capable of producing a bankable
turn-around business plan.

Expected Benefits / Impacts:

An improved TRL rail service, competitive with road services in respect of cost and reliability (as has
existed before), combined with increased capacity, will have direct economic benefits for both Tanzania
and the land locked countries of Burundi, DRC, Rwanda, Uganda and Uganda, through increased trade
competiveness, for both regional and international trade – lower prices and improved reliability will
increase volumes. A shift of freight from road to rail will also provide environmental and safety benefits.

Costs and Other Data:

Component Investment Duration Cost (US$

Start Year million)
Management contract for TRL, including 2011 2 years 2
short term revival, business plan,
procurement of funds for revival,
preparation of concession process
TOTAL 2
 A‐65

No. OPER-RL-02 2010-2016

Name: Establish Regional Railway Safety Regulator Action Plan Period:
Operations /
Mode or Subject Area: Rail Intervention Type: Regulatory - TA
Northern & Central Country(ies): Kenya / Uganda / Tanzania
Corridor: Corridors
Agencies Involved: RVR, Kenya Railways, Uganda Railways, TRL, RAHCO, SUMATRA
Related Projects (Donors): RVR and TRL railway Operating Concessions

Background/Rationale:

The railway systems operating on the Northern and Central Corridors, operating as RVR in Kenya and
Uganda and TRL in Tanzania, share a common track gauge of 1,000 mm and similar technical specification
in respect of wagon coupling systems. The two operating systems are interconnected with a rail link
between Moshi and Voi (Tanzania/Kenya) and by the rail ferry between Mwanza and Port Bell
(Tanzania/Uganda), although this interconnector have not been fully functional for some years due to
operational difficulties and consequent falling demand. The Kenyan and Ugandan railway system are
connected at Malaba and also via the Kisumu – Port Bell rail ferry service, all operated by RVR.

The respective railway safety regulators enforce the provisions of the railway acts in each country in
respect of track and equipment condition, operating procedures, including speed restrictions. Speed
restrictions and limitations on train lengths are intended to ensure safe operation conditions (prevent
derailments). In practice, with each country having its own safety regulator, when trains are moved from
one system or country to another, locomotive and train crews are switched. This solves the problem of
accountability in the event of an accident.

At the interchange point, the wagons are inspected and those with faults or safety issues are held back.
This process is time consuming and disruptive – very often consolidated loads are broken up because of
wagon faults, or trains are delayed because of the unavailability of locomotives at the interchange point. A
safety regulator which covers all three countries – Kenya, Uganda and Tanzania (and in future Rwanda
and Burundi) would allow the operation of seamless train services between the different systems and
countries, with joint wagon safety inspections carried out at the points of departure, rather than the
interchange points.

There have been discussions of various ways of establishing a common regional regulatory framework.
The options considered include having a regional regulator or having a single harmonized or common law
and regulation but enforced by individual national judicial jurisdiction since these are not harmonized.

Current Status:

Safety regulation of railway operations fall under the respective ministries of transport in Kenya and
Uganda, and under a specialized unit in Tanzania, SUMATRA (Surface and Maritime Transport
Authority), which is also responsible for transport economic regulation. There has been no attempt or
initiative to set up a regional railway safety regulator, mainly because of the general decline in railway
services in both corridors and the problems experienced with both the TRL and RVR railway concessions.
However, the RVR revival process is now underway, with the TRL revival being planned, and improved
interoperability will be a key success factor.
 A‐66

Description/ Major Components:

A study (TA) to investigate and propose a structure for the establishment and operation of a regional
railway safety regulator and the linkages to the various national transport safety regulators. This will be
confined to the Northern and Central Corridors only, rather than the EA region, because of the limited
geographical coverage of the 1,000 mm gauge system.

Critical Factors for Success:

In the first instance, the desire by the three countries served by the 1,000 mm gauge railway system, to
investigate the establishment of a railway safety regulator for the Northern and Central Corridors. The
process should be initiated and supported by the railway operators or concessionaires, with the objective of
improved performance and flexibility

Expected Benefits/ Impacts:

Improved competitiveness of railway services between adjacent systems and countries – uniform
standards and operating procedures, seamless train services with faster transit times and lower operating
costs.

Costs and Other Data:

Component Investment Duration Cost

Start Year (US$
million)
Study on Regional railway Safety
2011 4 months 0.4
Regulator Structure
TOTAL 0.4
 A‐67

No. OPER-L-01 2010-2013

Name: Develop Vessel Maintenance Capacity on Lake Tanganyika Action Plan Period:
Mode or Subject Area: Lakes Intervention Type: Operations
Corridor: Central Corridor Country(ies): Burundi, Tanzania and DRC
Agencies Involved: Shipyard Developers and Managers, Port Authorities and Governments
Related Projects (Donors):

Background/Rationale:

There are old vessel building and repair facilities (slipway/dry docks) at the ports of Kigoma, Kalemie and
Bujumbura, with different capacities and technical capabilities. However, there have been complaints by
some vessel operators of inadequate of capacity. In addition complaints have also been made on unfair
treatment or discrimination by some owners of these facilities. Furthermore, with the drive to redevelop
Lake Services, involving acquisition and deployment of newer vessels, as well as enhance safety standards,
there is need to develop adequate capacity to handle vessels building, assembling and repairs. This
capacity should also be developed and managed as common user facilities to service vessels from all
countries. A strategy to do so needs to be established and implemented.

Current Status:

Each main port (Kigoma, Kalemie and Bujumbura) has some repair facilities managed by respective Port
Authorities. An assessment of these facilities is required to determine a strategy for development adequate
and integrated vessel repair facilities on the Lake.

Description/ Major Components:

(1) Assessment of ship/vessel repair facilities on Lake Tanganyika and propose a strategy to develop
adequate facilities to match future requirements, including an institutional framework to ensure access by
vessels irrespective of their country of origin; (2) promote and secure the interest of potential investors and
managers of the facilities; (3) improvement/development of the facilities by interested investors/operators.

Critical Factors for Success:

(1) Suitable condition for growth of Lake transport services (sustenance of security and safety and
economic growth of the surrounding areas) to create good business prospects for ship building and repairs;
and (2) availability of willing investors and managers of ship repair services.

Expected Benefits/ Impacts:

(1) Enhancing of safety through operation of well serviced vessels; (2) creation of local capacity which will
better facilitate development of good standard Lake transport services; and (3) creation of jobs for local
people.
 A‐68

Costs and Other Data:

Component Investment Duration Cost (US$

Start Year million)
Assessment of vessel building and repair 2011 6 months 0.5
facilities on Lake Tanganyika to prepare a
strategy for developing adequate capacity
Improving/developing and managing 2011 18 months 1.5
vessel repair facilities on Lake Tanganyika
TOTAL 2.0
 A‐69

No. OPER-L-02 2010-2013

Name: Enhance Safe Navigation Action Plan Period:
Mode or Subject Area: Lakes Intervention Type: Infrastructure
Northern and Central Country(ies): Kenya, Tanzania, Burundi, Uganda and DRC
Corridor: Corridor
Agencies Involved: Governments, Regulators in each country
Related Projects (Donors):

Background/Rationale:

The Lakes do not have up-to-date navigational aids to guide safe sailing of vessels. The certification and
licensing of vessels and crew is also not harmonized among the countries allowing ship owners to operate
a wide variety of vessels to different standards. Furthermore, there is no credible and effective search and
rescue on the Lakes. Given this state there is no credible safety environment on the two Lakes. Partly due
to this many avoidable accidents happen and major accidents have resulted in huge losses. The most
dramatic accidents include the sinking 30 km off Mwanza port of MV Bukoba, a passenger steamer with
capacity of 430. This accident, which occurred in 1996 resulted in the drowning of approximately 800
people. Rescuers were brought in from as far as South Africa. The other major accident was the collision of
two wagon ferries in 2005, resulting with the drowning and loss of one of them.

Enhancing safety regulations will create conditions for avoiding some of these accidents and losses.

Current Status:

Safety issues are included in the two main initiatives for the two Lakes: The Lake Victoria Basin
Commission (LBVC) and Lake Tanganyika Basin Commission (LTBC) under which comprehensive
development and investment strategies are being pursued.

Description/ Major Components:

(1) Undertake/complete hydrographic surveys and install lake-wise and port navigational aids for safe
passage of ships; (2) Adopt recognized classification society rules regarding construction of ships/vessels;
(3) introduce meteorological navigational warnings and other services; (4) establish search and rescue
organization and adopt a harmonized implementation policy and strategy, including the possible use of
Global Maritime Distress Safety System (GMDSS) and (5) harmonize port security, safety and environmental
compliance strategies.

Critical Factors for Success:

(1) Commitment to reform from old poor practice by all institutions concerned and (2) availability of
technical support.

Expected Benefits/ Impacts:

Major impact is the improvement of safety on the Lakes and major reduction of accidents and loss of
property and lives.
 A‐70

Costs and Other Data:

Investment Duration Cost (US$

Component Start Year million)
Install navigational aids on Lakes Victoria 2011 36 months 2
and Tanganyika.
Establish/improve harmonized safety 2011 20 months 1
regulatory regime
TOTAL 3
 A‐71

No. OPER-P-01 2010-2013

Name: Enhancing Dar es Salaam Port Operation with ICT Applications Action Plan Period:
Mode or Subject Area: Port Intervention Type: Operations
Corridor: Central Corridor Country(ies): Tanzania
Agencies Involved: TPA and Port Stakeholders
Related Projects (Donors): World Bank

Background/Rationale:

Each procedure in the port can take two to three days. The problem is when they are done consecutively
they can take twelve to twenty days. Other delay factors include submitted documents being incomplete,
one agency taking paperwork out of the chain so it doesn’t get processed, clearing agents/shippers being
slow to pay fees and duties, shippers intentionally using the port/ICD for storage, poor tracking container
location, or stacking over five containers because of lack of space.

A community based system is designed to address this. The computer tracks procedures and payments as
they are initiated and completed. This allows the stakeholders to know where the container is in the
process toward release, thereby enabling interventions to expedite the process. It allows coordination of
port procedures through sending alerts that an action is needed and overall monitoring to identify
problems to be addressed. Tracking the flow of procedures in a computerized system enables each party
involved in the port transaction to know when required procedures are done and they can begin. It also
allows many procedures to be done simultaneously and that leads to greater efficiency and transparency.
It also mitigates corruption. Because time delays at the Port of Dar es Salaam are one of its largest
handicaps and the greatest time factor on the entire Central Corridor, this is a high priority project.

Current Status:

Tanzania Ports Authority requested funding a feasibility study for a community-based system under the
East Africa Trade and Transport Facilitation Project. This feasibility study for the implementation of a
community-based system has now been completed. The Dar es Salaam port community is in process of
setting up an organization to develop and implement the system.

Description/ Major Components:

The community-based system is essential to achieving the clearance times needed to handle the level of
traffic projected for the port of Dar es Salaam. This Project would establish a response mechanism for short
term technical assistance as needed in the development and implementation of the system. An overall
budget would be established and the port would be able to draw down on it as problems are encountered
that are not addressed in long term financing commitment to the project. A separate budget would be
established for incorporation of off the shelf software and adaptation as necessary. The Project would
provide assistance in acquiring software on a PPP basis which may include involvement of software
developer on an equity or loan basis.
 A‐72

Critical Factors for Success:

(1) The mechanism for obtaining short term support should be rapid, while at the same time preventing
frivolous requests, (2) Assistance should not replicate work already being done or committed. TA requests
would require some public reporting on progress that would identify what is being done and gaps in the
development and financing, (3) Progress of the implementation should be monitored to be sure work
progress reflects the urgent need for the system, (4) Information on off the shelf software should be
available or readily sourced, (5) Users should be engaged in the development process both in terms of
needs assessment and piloting of the system.

Expected Benefits/ Impacts:

Community-based systems have the potential to reduce dwell time to three to four days overall, if done
well. They enable the coordination of functions necessary to the most efficient processing of persons and
goods so they can be done simultaneously as much as possible. They facilitate optimum coordination
among agencies at the port. As they track and monitor the process electronically, they have the capacity to
reduce corruption as well since they remove much of the decision making from humans to computer
systems.

Costs and Other Data:

Investment Duration Cost (US$

Component Start Year million)
Short term technical assistance 2011 3 years 0.5
Off the shelf software and
2011 2 years 0.75
adaptation
TOTAL 1.25
 A‐73

No. OPER-P-02 2010-2013

Name: Enhancing Mombasa Port Operation with ICT Applications Action Plan Period:
Mode or Subject Area: Port Intervention Type: Operations
Corridor: Northern Corridor Country(ies): Kenya
Agencies Involved: Port Community
Related Projects (Donors): World Bank, DfID, USAID, JICA

Background/Rationale:

Each procedure in the port can take two to three days. The problem is when they are done consecutively
they can take twelve to twenty days. Other delay factors include submitted documents being incomplete,
one agency taking paperwork out of the chain so it doesn’t get processed, clearing agents/shippers being
slow to pay fees and duties, shippers intentionally using the port/ICD for storage, not tracking container
locations, or stacking over five containers because of lack of space.

A community based system is designed to address these factors. The computer tracks procedures and
payments as they are initiated and completed. Kenya began with implementation of a community-based
system and decided to change to a single window approach. A single window system allows one agency
to act on behalf of all parties in entering and tracking trade procedures to insure speed and efficiency.
Single window software includes all the risk parameters and requirements for all border agencies so that
the clearance can be completely automated and no human intervention is needed. This leads to greater
efficiency and transparency. Developing the system requires a great deal of data entry and in its most
sophisticated form- artificial intelligence software. The computer is able to route any trade transactions to
the appropriate agency modules that review completeness, determine fees, and trigger approval or the
need to human intervention.

Current Status:

Kenya has financing from the World Bank to develop a single window centralized in the Kenyan Cabinet
through the Ministry of Finance. Thus it is not housed in any of the border control agencies. This position
enables it to coordinate all government ministries’ participation. Kenya’s plan is to develop and
implement the system at the port of Mombasa, Kenyatta International Airport and land borders. Kenya
has just recruited additional specialists to the team designing the system.

Description/ Major Components:

The single window system is essential to achieving the clearance times needed to handle the level of traffic
projected for the port of Mombasa. This Project would establish a response mechanism for short term
technical assistance as needed in the development and implementation of the systems. An overall budget
would be established and the port or Project Team would be able to draw down on it as problems are
encountered that are not addressed in long term financing commitment to the project. A separate budget
would be established for incorporation of off the shelf software and adaptation as necessary. The Project
would provide assistance in acquiring software on a PPP basis which includes involvement of software
developer on an equity or loan basis.

Critical Factors for Success:

(1) The mechanism for obtaining short term support should be rapid, while at the same time preventing
frivolous requests, (2) Assistance should not replicate work already being done or committed. TA requests
would require some public reporting on progress that would identify what is being done and gaps in the
development and financing, (3) Progress of the implementation should be monitored to be sure work
progress reflects the urgent need for the system, (4) Information on off the shelf software should be
 A‐74

available or readily sourced, (5) Users should be engaged in the development process both in terms of
needs assessment and piloting of the system.

Expected Benefits/ Impacts:

These systems have the potential to reduce dwell time to three days overall at the port and to interject time
savings at the airport and land borders as well. Transit clearance can be handled once and the border used
only to confirm that transit goods have in fact left the country. They enable the coordination of functions
necessary to the most efficient processing of persons and goods. They facilitate optimum coordination
among agencies at the port. As they track and monitor the process electronically, they have the capacity to
reduce corruption as well since they remove much of the decision making from humans to computer
systems.

Costs and Other Data:

Investment Duration Cost (US$

Component Start Year million)
Short term technical assistance 2011 3 years 0.5
Off the shelf software and
2011 2 years 0.75
adaptation
TOTAL 1.25
 A‐75

No. OPER-TF-01 2011-2012

Name: Improved Vehicle Overload Control System Action Plan Period:
Mode or Subject Area: Road Intervention Type: Technical Assistance
Northern & Central Country(ies): All
Corridor: Corridor
Agencies Involved: National Roads Authorities, Ministries of Transport, Works and/or Infrastructure,
Transport Regulators, Traffic Police
Related Projects (Donors): JICA

Background/Rationale:

Art 90(l) of the EAC Treaty commits the partner states to: adopt common rules and regulations governing the
dimensions, technical requirements, gross weight and load per axle of vehicles used in trunk roads within the
Community. Under the guidance of the EAC Secretariat and with donor support, partner states reached
agreement in July 2008 on the harmonization of axle mass loads, gross vehicle mass limits, the adoption of
a formula for the protection of bridges and tolerance factors for overloads (i.e. grace percentages which do
not attract penalties). Agreement was also reached to ban quadrem axles and to decriminalize overloading
by adopting a system of administrative penalties to recover the economic cost of damage inflicted by
overloaded vehicles.

Major investments have been and continue to be made in improving Northern Corridor roads, in terms of
rehabilitation mainly after accelerated deterioration due partly to rampant overloading of vehicles. The
Central Corridor roads have been significantly improved, with the upgrading to paved standard of more
than 500 km in Tanzania and rehabilitation of another similar distance. Effective overload control is
essential to extract maximum economic benefit from this investment. Investment in railway systems is also
ongoing and the ability of rail to compete effectively with road transport also depends – significantly - on
effective measures to combat overloaded trucks and resultant lower than economic road transport
operation costs.

Current Status:

Despite the agreement reached in 2008, there has been little progress by Member States in amending their
legislation to adopt the harmonized regional standards. Moreover, only Tanzania has introduced the
agreed system of administrative penalties based on the recovery of actual economic costs of road damage.
Furthermore Rwanda and Burundi have no existing weighbridges infrastructure and are in the process of
establishing them at the border points.

The EAC is carrying out a study to review axle and load limits, which will guide an overload control
system in EAC. The study, financed by JICA, aims at harmonization of axle load limits within the Tripartite
(COMESA, EAC and SADC) region.

Existing overloading control strategy in Kenya, Uganda and Tanzania is aimed at achieving one hundred
percent inspection of all commercial vehicles. The frequency of checks is also a concern. For example there
are nine weigh-stations in Tanzania, nine in Kenya, four in Uganda and transit vehicles have to be checked
at all these points instead of the ideal two, one at departure and another at exit. There is no targeted risk
management approach and no incentive to encourage truckers to self-regulate. The high intensity of
checking increases journey times and provides an added incentive for corruption. Differences in national
limits complicate cross-border operations.
 A‐76

Description/ Major Components:

Technical assistance is initially required to assist member states to align legislation on vehicle limits with
regional standards and to pass new regulations providing for administrative penalties. All states need to
revise legislation to adopt the regional limits, although Tanzania has already adopted new rules providing
for administrative penalties.

Experience elsewhere has highlighted that the efficacy of overload controls is improved when the trucking
industry is fully cognizant of the content of the new rules and their application. Outreach activities to
sensitize the trucking industry to the implications of the new rules are useful to ensure smooth
implementation of the administrative system and to secure the co-operation of industry – from an early
stage – to improve compliance levels. At the same time, training of weighbridge staff and law enforcement
officers in the implementation of the new rules is also needed. Provision therefore needs to be made to
conduct workshops and information sessions with the trucking industry (once legislation is finalized) and
to hold practical training sessions with weighbridge personnel and enforcement personnel.

In the longer term, technical assistance can be extended to develop a regional overloading control strategy
which utilizes targeted enforcement techniques based on risk management. This includes focusing on
specific vehicles and cargo types prone to overloading, establishing databases to develop profiles of
frequent offenders and adopting additional enforcement measures to target high-risk truckers.
Additionally, measures to encourage self-regulation, such as the accreditation of compliant truckers who
qualify for more lenient treatment based on their compliance records, can be introduced.

Critical Factors for Success:

Co-operation by line function ministries and Attorney-Generals’ Chambers to process legislation is a

critical precondition for success. Without a legislative basis, the remaining components of the technical
assistance cannot be implemented.

Expected Benefits/Impacts:

The major benefit expected from the proposed intervention is to significantly improve levels of compliance.
The reduced incidence of overloading will also extend pavement life and hence improve the economic
return on the investment in road infrastructure. Improved compliance will also secure greater safety
benefits by reducing the incidence of traffic accidents caused by overloading. Lastly, transport operations
on the corridor will be facilitated by the existence of a harmonized regulatory framework.

Costs and Other Data:

Investment Duration Cost (US$

Component Start Year million)
Legislative harmonization 2011 6 months 0.5
Trucking industry outreach and sensitization 2011-2 2 months 0.1
Training: weighbridge personnel, law enforcers 2011 3 months 0.3
TOTAL 0.9
 A‐77

No. OPER-TF-02 2011-2013

Name: Liberalize Transit Requirements Action Plan Period:
Mode or Subject Area: Facilitation Intervention Type: Operations
Northern/Central Country(ies): Kenya and Tanzania
Corridor: Corridor
Agencies Involved: Revenue and Transport Authorities
Related Projects (Donors): EAC Customs Management Act Regulations and Procedures, EAC and
COMESA Common Carrier License development and implementation

Background/Rationale:

In the Corridor states, road transport regulation included carrier licensing and safety regulation, periodic
testing for vehicle road worthiness and driver ability. Kenyan and Tanzanian road transporters carry most
transit goods in the EAC. In 1995, Kenya transferred the registration and licensing of vehicles to Kenya
Revenue Authority. EAC customs regulation requires that vehicles carrying goods in transit and/or under
customs control be licensed. In Kenya, vehicles licensed for transit cannot carry domestic cargo and must
use prescribed transit routes. This has the effect of many return trips being empty. Similarly in Tanzania,
the issuing of licenses for goods carrying vehicles was abolished. Registration with SUMATRA requires
proof of vehicle inspection, third party insurance and registration with Tanzania Revenue Authority
(TRA). Through these systems, Kenya and Tanzania restrict road transporters use of their vehicles causing
transporters to incur the full cost of a round trip to make a one way delivery. Shippers are often billed for a
round trip when they only need to have goods hauled one way. The current regulations need to be
reviewed to find a means of avoiding diversion of goods into the local market without unduly raising the
cost of providing transport services.

Current Status:

The Tanzania Revenue Authority has experimented with permitting truckers to load backhauls using
transit vehicles provided the truck follows the prescribed transit route and reports to TRA check points
along the route and to TRA at the conclusion of the trip. While adding to the delays for domestic haulage,
it enables the vehicle to return loaded. This system could be tried in Kenya as well, or another system
identified. The implementation of the EAC Common Market Protocol, which began on July 1, 2010, has the
goal of liberalizing the transport market. In the Protocol, however, Kenya reserved the right to restrict
transport operators from other countries to establish a commercial presence in Kenya. Broader issues of
market access need to be resolved in EAC.

Description/ Major Components:

(1) TA support to EAC to facilitate discussion between public and private sector stakeholders on phasing
out licensing of transit vehicles and vehicles carrying goods under customs control (possibly using TRA
approach as starting point). From this dialogue, options should be identified that improve transport
efficiency and cost while recognizing the revenue concerns of customs. (2) The proposed option should be
piloted on the two corridors and refined based on the pilot. (3) Once a system has been agreed among the
agencies involved, the regulations should be modified to accommodate the solution. (4) A system for
monitoring impact should be part of the proposal.
 A‐78

Critical Factors for Success:

Success will depend on the willingness of all parties to engage in a dialogue and commitment to finding a
workable solution. The pilot will need to be conducted in such a way that it produces quantifiable results
and the parameters for new transit regulations. The resulting regulation should be linked to, but not
dependent on, the implementation of a regional transport licensing agreement.

Expected Benefits/ Impacts:

A solution that enables optimal vehicle utilization will enable road transporters to reduce their transport
costs by thirty to forty percent.

Costs and Other Data:

Investment Duration Cost

Component Start Year (US$
million)
Technical Assistance 2011 9 months 0.4
TOTAL 0.4
 A‐79

No. OPER-TF-03 2011-2013

Name: Maximize Customs Union Implementation Benefits Action Plan Period:
Mode or Subject Area: Facilitation Intervention Type: Operations
Northern/ Central Country(ies): All EAC countries
Corridor: Corridor
Agencies Involved: Revenue Authorities, Road Agencies
Related Projects (Donors): Secretariat Activities in implementing the Customs Union

Background/Rationale:

The Customs Management Act (CMA) establishes the common external tariffs and reduction formula for
reduction of internal tariffs that is currently being implemented. The regulations for implementing the
CMA have been approved, and procedures are now being developed. Adoption of a regional external
tariff collection system is one of the issues still being determined. Since this system will have a
considerable impact on the national transit regulation administered by customs authorities, it will also
have a direct impact on the cost and efficiency of transport on the Northern and Central Corridors.
Customs controls include such restrictive measures as permitting vehicles for either domestic or transit
haulage, escorting, frequent customs stops on major corridors. Therefore it is important that the system
takes transport cost and efficiency into consideration.

Current Status:

The EAC Customs unit in the Secretariat is currently working on the tariff collection system and seeking
agreement of all member states. In meetings with national customs authorities, it was evident that the
national revenue authorities are not consulting with transport agencies in developing transit regulations. It
is the right time to provide insight on the impact on transport charges, operational efficiency and vehicle
utilization.

Description/ Major Components:

TA is proposed to review the transport cost, time and reliability impact of various proposals for full
implementation of the Customs Union. The purpose is to propose a series of recommendations to the EAC
Secretariat and the national governments on the impact of each collection method on transport efficiency
and trade development within the Community as well as external trade. The goal is for these impacts to be
taken into account when the decision is taken by the partner states on the collection system.

Critical Factors for Success:

The success will depend on the ability to make a cogent argument for the impact of collection on transport
cost and time and on trade development and the generation of other means of tax collection.

Expected Benefits/ Impacts:

If customs are collected at the point of entry and distributed according to current assessment regimes or
according to a revenue sharing formula, many of the current transit controls would be unnecessary. This
would have a significant impact on transport cost and efficiency, because transport decisions could be
made solely on a commercial basis. This in turn would encourage greater trade and overall value added
production in the countries that would generate additional revenue through other tax sources.
 A‐80

Costs and Other Data:

Component Investment Duration Cost

Start Year (US$
million)
Technical Assistance 2011 4 months 0.3
TOTAL 0.3
 A‐81

No. OPER-TF-04 2011-2013

Name: Streamline Customs Clearances Action Plan Period:
Mode or Subject Area: Facilitation Intervention Type: Operations
Northern/Central Country(ies): All EAC countries
Corridor: Corridor
Agencies Involved: Revenue Authorities
Related Projects (Donors): JICA, DfID. USAID

Background/Rationale:

Insufficient use is made of customs tools to expedite processing. Clearance modernization is being
implemented at the national level and the extent of implementation is varied. Tools include risk
management, accredited economic operators, customs bonds and control points, preclearance and so forth.
There is need to review current and new procedures on a corridor basis to insure that common procedures
are developed and that information collected at one point is available to all transit borders. This both
expedites transit and reduces the opportunity for filing different information at different borders. It
increases the transparency of trade.

A variety of initiatives have been taken to modernize and harmonize customs clearance procedures.
Further implementation and coordination of efforts is needed to arrive at a harmonized system for these
two corridors. Since Uganda, Rwanda and Burundi use both the Northern and the Central Corridors, it is
important to harmonize the systems used on both corridors. Burundi converted a government customs
department to a Revenue Authority in April 2010 and is making a series of changes in its clearance
procedures. This is a good time to insure that the transition in Burundi is coordinated with development in
the other countries along the two Corridors. Further training and harmonization throughout EAC is
needed to achieve the full benefits.

Current Status:

JICA has been providing training in risk management systems and some partner states such as Uganda
have fully implemented it so that clearances are expedited for compliant traders and operators. A monthly
review of risk profiles insures that the Uganda system reflects current performance of corridor users.
Uganda has been working on a system of accredited operators, but not yet implemented. Rwanda has
begun implementing an accredited operator system with its blue channel system which has reduced
clearance time in Kigali from two to three days to a few hours for compliant customers. As some countries
move clearance procedures to the borders, such measures will become even more important to insuring
that revenue is collected without unduly delaying trade. Uganda allows clearing and forwarding agents to
submit documents in advance and prepay duties based on their calculation, but document review and duty
assessment is done at the border or in Kampala at the determination of the importer. Preclearance linked
to prepayment is another tool to be implemented in the partner countries. The World Customs
Organization is supporting this kind of initiatives and should be a resource to draw on for information and
potential support.

Description/ Major Components:

(1) A coordinated program of regional training/capacity building on customs modernization tools

followed by regional TA on implementation at national level and harmonization at regional level will
result in more streamlined border operations. The training and capacity building must involve the border
control agencies and the private sector. The objective is to more effectively implement Risk Management,
Accredited Economic Operator Programs, Preclearance and Prepayment, etc. so as to have similar
procedures at all borders and risk management sharing among Revenue Authorities on the corridors to
increase the confidence in the system. (2) TA to produce harmonized regional guidelines based on activity
 A‐82

(1) above and programs implemented at national level. This would be followed by TA to facilitate
incorporation in national procedures and operations to insure that the harmonization is realized. The
expected output is harmonized customs procedures at borders that reduce paperwork and increase
efficiency of customs revenue collection and transit movement on the corridors.

Critical Factors for Success:

Many of the customs tools involve the electronic transmission of data and payments. The success of this
training and TA is dependent on the implementation of reliable interconnectivity between borders and
headquarters and among the countries. It also requires reliable, inexpensive data connectivity for the
private sector to customs and between clearance points and the borders. The experience of Rwanda
demonstrates that where connectivity is available the private sector will incorporate it into its operations so
that they also enhance the operational efficiency. Success also depends on the continued commitment of
Revenue Authorities to modernize procedures and to see transit efficiency as an important goal. EAC has
mechanisms in place for harmonizing procedures throughout the community and needs to use them for
this effort. It is independent, but related to OSBP implementation in that a primary objective of the OSBP is
to achieve simplified, harmonized procedures. If this initiative is completed, the main issue for the OSBP
implementation concerning procedures is how they can be carried out in the neighboring country in the
same facility and what further efficiencies can be obtained from operating in proximity and where possible,
jointly.

Expected Benefits/ Impacts:

The expected benefit is increased revenue collection, reduced time spent in border clearances and increased
trade among EAC countries as well as between EAC countries and countries outside the EAC. This would
be achieved through (1) developing national and regional procedures that incorporate the latest techniques
for identifying risk of revenue loss to avoid extensive scanning and physical inspections that are time-
consuming, (2) rewarding compliant traders rather than delaying everyone for the practices of a few, and
(3) encouraging advance preparation of documents, preliminary clearance and advance payment to reduce
the time spent at borders.

Costs and Other Data:

Component Investment Duration Cost

Start Year (US$
million)
Training, Capacity Building and 2011 24 months 0.9
TA
TOTAL 0.9
 A‐83

No. OPER-TF-05 2010-2013

Name: OSBP Implementation Action Plan Period:
Mode or Subject Area: Port Intervention Type: Operations
East African Country(ies): EAC Partner States
Corridor: Community
Agencies Involved: All border control agencies
Related Projects (Donors): JICA, Trademark East Africa/DfID, USAID/Compete.

Background/Rationale:

The East African Community has made a commitment to reducing the time spent at borders and inland
clearance by introducing One Stop Border Posts. The objective of a One Stop Border Post (OSBP) is to
enhance trade facilitation by reducing the number of stops incurred in a cross border trade transaction by
combining the activities of both countries’ border organizations at a single location with simplified
procedures and joint processing and inspections, where feasible. It is also designed to reduce on the time
taken to clear passengers at the border. EAC has common regulations for the implementation of the
Customs Union. Procedures are currently being developed and should be adapted for OSBP. Repetitive
processing at borders and manual entry of data creates inefficiencies. OSBP should optimize use of
electronic data entry and sharing.

Current Status:

(1) In 2010, an EAC legal framework for OSBP was developed with assistance from JICA and approved up
to the Multi-sectoral Council of Ministers. The draft EAC OSBP Act, which establishes the legal authority
and procedures for OSBP, will be introduced to the EAC Legislative Assembly in early 2011. (2) JICA is
funding a project to develop a resource document for OSBP implementation based on current experience
and lessons learned at other OSBP, particularly within Africa. (3) A number of projects are carrying out
feasibility studies and engineering design for OSBP facilities on the Northern and Central Corridors. At
Malaba, the busiest border on the Northern Corridor, several donors have been involved in designing
OSBP including USAID, World Bank and DfID.

At Gatuna/Katuna on the Uganda/Rwanda border and Mutukula on the Uganda/Tanzania border OSBP
design and construction is being supported by the World Bank as part of the East Africa Trade and
Transport Facilitation Project. While procurement is done nationally, Bilateral Committees have been
working to coordinate engineering design and procedures to insure harmonization between the juxtaposed
facilities. At Akinyaru/Kinyaru Haut between Rwanda and Burundi, the African Development Bank is
funding a feasibility study under the East Africa Trade and Transport Facilitation Project. At Rusumo on
the Tanzania/Rwanda border, JICA is in final approval for financing a new bridge and OSBP border posts.
At Kobero/Kabanga on the Burundi/Tanzania border, DfID through Trade Mark East Africa is financing a
feasibility study and engineering design for an OSBP. These projects mean that the facilities will have been
designed for all the key borders on the Northern and Central Corridors and the construction for facilities is
funded for the first three.

Description/ Major Components:

OSBP are complicated, because of the number of agencies at the border, the lack of a single agency
manager and the need for simplified and harmonized procedures. As EAC continues the implementation
of OSBP, it is essential that there is coordination so that common procedures and joint inspections are
developed as much as possible.

(1) TA for the Customs unit in EAC Secretariat in finalizing and obtaining consensus on OSBP
 A‐84

procedures and an oversight mechanism to insure common development of OSBPs. Three consultative
workshops are planned for technical agreement on proposed procedures. The EAC OSBP Act establishes
most aspects of operations of an OSBP. It allows for divergence of procedures as required by geography or
other factors. It is also necessary for each border agency to determine how they will carry out
responsibilities in the new arrangement. It is also necessary to determine how joint scanning, joint
inspections and other special procedure will be implemented at OSBPs.

(2) Border management information systems are needed for single electronic entry of data and
information-sharing. The initial entry into a single data base, sharing of information and handling of
preclearance of cargo for compliant customers should be built into the system. It should also take into
account the future changes that will need to occur with further implementation of the Customs Union and
Common Market. This component entails support for software development and implementation,
including training and updating of software. It includes preparation of information sharing legislation, if
necessary, among national border agencies.

Critical Factors for Success:

For implementation of OSBP to be successful, all the components should be coordinated and synchronized:
legal framework, appropriate engineering design and traffic flow, simplified procedures and ICT
applications to enable electronic transfer of information, payments etc. Failure to carry out any of them
effectively will diminish the benefits achieved. ICT connectivity needs to be established early in the
development process, so that applications can be developed, tested and training completed in advance of
the border opening. Commitment from all border agencies is also critical to success.

Expected Benefits/ Impacts:

Where they have been implemented they have cut the time of processing pedestrians and passengers in
cars, minivans and buses by half. Substantial time savings for cargo has been achieved depending on the
treatment of compliant clients. Time savings result in considerable vehicle operating cost savings.

Costs and Other Data:

Component Investment Duration Cost

Start Year (US$
million)
TA for Customs Procedures Development 2011 6 months 0.5
ICP Applications Development and Training 2011 15 months 0.5
Software Development 0.5
TOTAL 1.5
 A‐85

No. OPER-TF-06 2011-2013

Name: Reduce Stops and Informal Payments on Corridors Action Plan Period:
Mode or Subject Area: Facilitation Intervention Type: Operations
Northern/Central Country(ies): All countries
Corridor: Corridor
Agencies Involved: National Police, Roads Authorities, Local Government, NCTTCA, CCTTFA
Related Projects (Donors):

Background/Rationale:

Both corridors suffer from serious delays caused by informal stops and check points on the route. Some
are officially sanctioned and some are created to collect payments to police, transit authorities and local
communities. Without sufficient law enforcement vehicles, stationary control points to check for driving
licenses, vehicle registration, vehicle road worthiness certificates and to inspect vehicles for contraband and
trafficking are essential. Nevertheless, unofficial stops delay transit transport and add cost to transport
which is passed on to the shipper. In other cases, they are payments to avoid regulatory control, such as
payments especially on the Northern Corridor to avoid overloading controls. It will require a concerted
effort by governments, individual agencies and the road users to end this problem. Studies on the
Northern Corridor suggest a cost as high as US$900 is added by informal stops. Road transporters on the
Central Corridor report that the cost is from US$50-100.

Current Status:

Efforts have been made by organizations, such as the Private Sector Foundation and the East African
Business Council to monitor the situation and to lobby for better control over informal stops and payment
demands. These efforts need to be actively supported and expanded to reduce this practice.

Description/ Major Components:

(1) The project will include TA to work with police departments to set up an internal monitoring unit and
to design their own programs to control the number and frequency of official stops and to eliminate other
stops. A component of the program should be training on integrity and the impact of the current situation
on police credibility and trade. All police should be required to wear uniforms and carry badges, except
for detectives or others who for official reasons do not wear uniforms. The project should have a specific
budget for TA and resource allocation as recommended by the police units themselves. (2) A public
information program will be incorporated to discourage payment of bribes and encourage reporting of
officers requesting money. This program should involve both presentations at appropriate meetings and a
series of TV and radio spots broadcast at high volume times and concentrated within a specific period. A
special week might to organized to focus attention on the issue including presentations, TV and radio spots
and stakeholders forum to inform the public on the impact of paying bribes and perpetuating the system as
well as to seek other solutions to the problem. (3) The NCTTCA and CCTTFA should be involved in the
effort to promote integrity on an on-going basis and have some funds to begin a process of monitoring the
roads for compliance. One of their roles would be to work with agencies involved to maintain the
vigilance and incentives for mostly unimpeded transit on the highways. The TA would fund setting up a
program for long-term monitoring and stakeholder awareness by the corridor groups that is sustainable.
 A‐86

Critical Factors for Success:

It would be critical that the relevant agencies, particularly the police, weighbridge authority and local
governments, are committed to maximum free movement on the corridors. Without their commitment,
change is unlikely. The program must be sustainable and not a short term correction.

Expected Benefits/ Impacts:

The benefit would be reduced driving, or rather “non-driving,” time on the corridors. It will also reduce
the informal payments made by drivers and thereby reduce the transport costs and uncertainty. It is
designed to achieve a sustainable program to maintain the attention and benefits.

Costs and Other Data:

Component Investment Duration * Cost

Start Year (US$
million)
Technical assistance and facilitation 2011 12 months 0.2
Physical resources for monitoring 2011 18 months 0.2
Public information spots, production and 2011 12 months 0.5
broadcast
TOTAL 0.9
*These components would be integrated during the same time period.
 A‐87

No. OPER-TF-07 2012-2013

Name: Implement Effective Transit Regime Action Plan Period:
Mode or Subject Area: Facilitation Intervention Type: Operations
Northern/Central Country(ies):
Burundi, Kenya, Rwanda, Tanzania, Uganda
Corridor: Corridor
Agencies Involved: Border Control and Road Transport Agencies
Related Projects (Donors): East Africa Transport Facilitation Project

Background/Rationale:

To be competitive, a corridor should offer seamless movement to travelers, tourists, vehicles and cargo.
Transit needs to be seen as an integrated system of shared information, effective guarantees, and a
commitment to speed and service. It can best be achieved on corridors, building to an EAC level system. It
also requires cooperation among government agencies such as customs, road authorities, police, etc. There
are many efforts to streamline and harmonize transit regulations within the East African Community, but
many of them have not been implemented. Some have not been agreed at regional level, some have been
agreed at regional level and not domesticated in national law and some have been domesticated and still
not implemented.

Failure to implement impedes transit movement in terms of cost, time and reliability. (1) Common vehicle
dimensions need to be agreed and enforced. Otherwise drivers are restricted to the lowest dimension or
weight. (2) Joint recognition for road worthiness testing and certificates so that insurance such as the
yellow card can be effectively employed. (3) Application of a single administrative document by customs
on both corridors (entered electronically once, downloaded and modified as needed by each country). (4)
Full implementation of RADDEx for vehicle and cargo tracking on both corridors and immediate acquittal
of customs bonds when goods cross the border. (5) Agreement on full sharing of information on the
corridor. Implementing an effective transit regime is done issue by issue, but also requires an overall vision
and monitoring to achieve a coordinated outcome.

Current Status:

Many aspects of a transit regime exist, but have not been fully implemented. Common vehicle regulations
have been issued, but not fully implemented and there are current efforts to change again. Road
worthiness standards have been promoted, but there is lack of trust in the systems of other EAC partner
states. Customs declaration have been simplified and harmonized, but each country still requires its own
form under national insignia. While they can be filed electronically, they cannot be modified and most
countries still require the hard copy as the legal copy. RADDEx and the common customs bond have been
partially implemented in EAC. There is need for a more coordinated, pro-active program of implementing
a single system.

Description/ Major Components:

The transit regime can most easily be implemented on corridors where the impact of failure to act is
immediately felt. Customs items will be affected by the fuller implementation of the Customs Union. It is
assumed that the measures recommended here are important to the current transit regime and will be
modified or eliminated according to decisions taken on the external tariff collection system and phase out
of internal tariffs. TA to achieve the following:

1) Implementation of harmonized vehicle weight and dimension standards and enforcement with a
goal of weighing only at port, border (s) and destination.
2) Recognition of road worthiness testing and certificates by all authorities and insurance agencies.
Assistance to programs that are weak, either in testing capacity or enforcement.
 A‐88

3) Single customs document produced once with a copy for all customs agencies and copy retained
by driver with stamps from all customs agencies. Conversion to and regional recognition of
electronic entries, verification and release.
4) Full implementation of RADDEx in all Corridor countries to allow effective tracking. Application
of tracking systems for customs, vehicle agencies, and forwarders/shippers using RADDEx.
5) Common customs bond administered on each corridor and later adopted in the region.
Immediate acquittals of bond at conclusion of journey.
6) Agreement for full sharing of information on the corridor.

Activity would begin with an assessment of the overall system and where interventions are required and a
work plan for activities on both corridors. This would be carried out in coordination with NCTTCA and
CCTTFA so that it supplements their initiatives and is monitored by them for sustainability. It would also
be coordinated with EAC so that all measures aim toward the development of a community-wide system.
EAC would determine continuity with broader Tripartite goals and initiatives.

This is seen as an intermittent activity to provide technical assistance as needed to national and EAC
specialists as they work toward implementation. It will provide an oversight mechanism to insure that
initiatives continue to move forward and that the result is a coordinated system.

Critical Factors for Success:

These are initiatives that have been addressed at national and regional levels already, but not completed
and fully implemented. Success will require sustained commitment and allocation of staff time in relevant
agencies at the national level. Success will require fostering more effective coordination between customs,
transport agencies and the private sector in reaching solutions that achieve the goal of fostering trade and
economic growth.

Expected Benefits/ Impacts:

Time is saved by reduced document preparation. The road transporter is able to make faster, more reliable
deliveries at lower costs. Money is tied up in trade transactions for a shorter period of time due to faster
delivery and quicker acquittal of bonds.

Costs and Other Data:

Investment Duration Cost (US$

Component Start Year million)
Technical Assistance 2011 24 months 0.9
TOTAL 0.9
 A‐89

OPER-TF-08
No. Integration of National and Regional Transport Policies 2011 – 2013
Name: Action Plan Period:
Mode or Subject Area: Road Intervention Type: Technical Assistance
Northern & Central Country(ies): All
Corridor: Corridor
Agencies Involved: Ministries of Transport, Transport Regulators, Traffic Polices

Related Projects (Donors): World Bank

Background/Rationale:

The EAC treaty commits Partner States to implementing a common road transport policy (Art 90). The
EAC States have partially given effect to this commitment by concluding the Tripartite Agreement on Road
Transport in 2001. The Tripartite Agreement provides a common framework for regulating cross-border
road transport and introduces a variety of facilitation measures to improve operational efficiencies. To
date, the Tripartite Agreement has not yet been implemented, mainly due to the absence of enabling
domestic laws. Moreover, states are still individually pursuing national policies with objectives which are
at times in conflict with their commitments under the Treaty. These result in low utilization of transport
vehicles and, thus, higher transportation cost.

The commitments under the EAC Treaty include harmonising the provisions of their laws on traffic and
licensing, establishing common measures for the facilitation of road transit traffic, adopting common and
simplified procedures for road transport documentation and harmonising road transit charges, reducing
and eliminating non-physical barriers to road transport, ensuring that common carriers from other Partner
States have the same opportunities and facilities as common carriers in their territories in the undertaking
of transport operations within the Community; ensuring that the treatment of motor transport operators
engaged in transport within the Community from other Partner States is not less favourable than that
accorded to the operators of similar transport from their own territories and making road transport
efficient and cost effective by promoting competition and introducing regulatory framework to facilitate
the road haulage industry operations.

Current Status:
Domestic road transport policies in all states are aimed at deregulated market access, which has had some
positive effects, but the lack of qualitative regulation has also had several undesirable consequences. These
include low entry barriers leading to cut throat competition, low safety levels and poor service quality.
Operational standards need to be improved and governments need to align their policies to encourage the
growth of a professional transport industry which is able to compete effectively within a framework of
clearly-defined rules and appropriate regulation.

National policies do not, as yet, prioritize regional commitments appropriately which partially underlies
the failure of governments to implement the Tripartite Agreement. Non-implementation of the Agreement
carries a significant opportunity cost, as the potential cost savings and efficiency improvements envisaged
by the Agreement are not captured. Road transport operations on the corridors remain constrained by
conflicting national rules and prone to new non-physical barriers.

Description/ Major Components:

Technical assistance is required in two phases. Short term assistance is required to support EAC states to
implement the Tripartite Agreement. This is required to:
• Revise existing legislation and adopt new legislation to domesticate the Agreement in the national
laws of the member states;
 A‐90

• Design licence application, adjudication and issuing procedures and forms;

• Design license administration software systems and procure hardware;
• Train personnel in the handling of applications, adjudication and issuing;
• Train law enforcers in the application of on-the-road enforcement of the rules under the
Agreement;
• Develop transport supply and demand capacity to manage competition between carriers from
different states; and
• Undertake monitoring and evaluation.
Medium assistance is required to help EAC states align their road transport policies and implement
complementary regulatory policies for national and international transport. Such policies and regulations
must be aimed at developing a professional road transport industry characterized by a progressive
improvement in quality and safety standards. Technical assistance is likely to be required to:
• Design the features of the policy/ regulatory system through a process of stakeholder
consultation;
• Develop an appropriate institutional framework;
• Draft an EAC Road Transport and Traffic Act and implementing regulations;
• Define standards for access to the road transport profession;
• Develop procedures for evaluating applicants and issuing operator licenses;
• Design support software and procure hardware to operate a multi-module database;
• Conduct training of regulatory and law enforcement personnel; and
• Undertake monitoring and evaluation.

Critical Factors for Success:

Due to the multilateral nature of the Tripartite Agreement, successful implementation depends on
comparable levels of commitment from all Partner States. Similarly, national measures need to be
coordinated to ensure that progress is synchronized in all states to ensure concurrent implementation.

Expected Benefits/Impacts:

Multilateral arrangements similar to the Tripartite Agreement have delivered proven benefits elsewhere
(e.g. Southern Africa) in terms of improved transport efficiencies and competition, reduced costs, etc.
Similar benefits can be expected to be derived from implementation of the Agreement in East Africa.

Costs and Other Data:

Investment Duration Cost (US$

Component Start Year million)
Preparation of domestic laws incorporating 2011 6 months 0.25
Tripartite Agreement in all partner states
Procedures development/ software 2011-2 3 months 0.25
Training 2012 3 months 0.25
Implementation support / M&E 2012 6 months 0.25
Support to develop common national road 2012-3 6 months 0.5
transport policies / drafting of EAC Act
Implementation support 2013 6 months 0.5
 A‐91

No. OPER-TF-09 2011-2014

Name: Leadership by NCTTCA Action Plan Period:
Mode or Subject Area: All Modes and Facilitation Intervention Type: Operations
Corridor: Northern Corridor Country(ies): Burundi, DRC, Kenya, Rwanda, Uganda
Agencies Involved: Corridor Stakeholders, public and private
Related Projects (Donors): East Africa Transport Facilitation Project; TradeMark/SSATPObservatories;
COMPETE support to NC and CC

Background/Rationale:

Many of the infrastructure and facilitation improvements should be done on a corridor basis.
Improvement is a dynamic process driven by dialogue between public and private sectors. The Northern
Corridor Transit Transport Coordination Authority (NCTTCA) was formed to facilitate implementation of
the Northern Corridor Transit Agreement signed in 1986/1987 among the participating countries of Kenya,
Uganda, Rwanda, Burundi and DRC to guarantee the land locked countries access to the sea for trade.
These countries signed a Revised Agreement in 2009, with similar objectives. Decisions are made by organs
comprised of member states plus a stakeholder forum to represent private sector views to the Authority.
The Organs including a Stakeholders Forum, the Executive Board and Council of Ministers meet regularly
to provide a good framework for necessary dialogue and decision making. Hence, the NCTTCA is best
positioned to lead and monitor the process of corridor performance improvement and development.

The objective is to insure effective operation of transport, logistics and trade on the corridor in the interest
of all member countries. With this mandate and structures, they are ideally suited to promote the
infrastructure, facilitation and legal and regulatory framework identified by the Corridor Diagnostic Study
(CDS) to strengthen corridor infrastructure and operations. NCTTCA has specialists on staff for
infrastructure, facilitation and trade and some resources provided by members. Nevertheless, they need
assistance to develop a sustainable plan for advocacy and fostering stakeholder actions to implement
measures identified to achieve necessary improvements. This TA should be integrated with the other
facilitation TAs provided by the East Africa Trade Facilitation project, TradeMark EA, COMPETE project,
the SSATP and JICA to build a sustainable way forward to achieve on-going corridor improvement targets.

Current Status:

The NCTTCA has been active since 1987 and has an agreed action plan and financing mechanism. Many
decisions have been made with implementation either still outstanding or not effected as expected. A series
of studies have recently been carried out for them, including the recent transport observatory, master plan
for infrastructure development just being completed and a study of transport costs on the corridor. A
spatial development study has also been carried out to review the opportunities for value-added resource
businesses and manufacturing on the Northern Corridor. Each of these studies makes a series of
recommendations to NCTTCA. CDS, which has taken into account all these studies, quantifies the time,
price and reliability of transport and logistics operations and recommends investments to make the
Northern Corridor perform better. . Therefore the NCTTCA has a recommended Action Plan and
substantial data to support it. NCTTCA is well established, but needs a way to more fully engage their
public sector members in the improvement process and to more fully incorporate the private sector in
identifying problems and solutions. Specifically NCTTCA needs to establish a monitoring system of
implementation of the action plan, securing fulfillment of commitments made by its members and
publishing impact of implementation for the benefit of users of the corridor. As NCTTCA seeks to
implement the Action Plan, it needs access to some additional TA and field work on a demand basis.

Description/ Major Components:

 A‐92

This assistance would consist of two parts, TA and workshop support. The TA would assist in establishing
a consultative public private process, based on the recent studies, to set the work agenda and commit
government agencies and private sector to responsibility for specific tasks to motivate and monitor
achievement of the CDS Action Plan. NCTTCA would need to create a stronger mechanism for delivering
this commitment of both public and private sectors. Once initiated, progress toward agreed outputs would
be assessed and redirected every six months. TA would fund meetings for the first two years, and fund 50
percent for the third year as the mechanism is made sustainable

Critical Factors for Success:

This initiative will be successful if all the participating members agree to devote time to specific tasks
because they are committed to the goals. The Northern Corridor has tended to rely on donor support and
outside consultants. This TA is intended to encourage active involvement from their staff and members to
make the activities sustainable and to reduce the dependence on outside consultants. This TA is designed
to allow TTCA to pilot the methodology on several priority issues identified by CDS and to do so in a way
that the model is sustainable. It will also depend on member buy-in to be successful.

Expected Benefits/ Impacts:

For NCTTCA, it would strengthen their private sector participation and a sustainable means of achieving
results.

Costs and Other Data:

Investment Duration Cost (US$

Component Start Year million)
TA 2011 12 months 0.15

Workshops 2011 36 months 0.15

TOTAL 0.3
 A‐93

No. OPER-TF-10 2011-2014

Name: Leadership by CCTTFA Action Plan Period:
Mode or Subject Area: All Modes and Facilitation Intervention Type: Operations
Corridor: Central Corridor Country(ies): Burundi, Rwanda, Tanzania, Uganda, DRC
Agencies Involved: Corridor Stakeholders, public and private
East Africa Transport Facilitation Project; TradeMark/SSATP Observatories;
Related Projects (Donors): COMPETE support to NC and CC

Background/Rationale:

Many of the infrastructure and facilitation improvements should be done on a corridor basis.
Improvement is a dynamic process driven by dialogue between public and private sectors. CCTTFA is best
positioned to lead and monitor the process at the corridor level. The Central Corridor Transit Transport
Facilitation Agency (CCTTFA) was signed and ratified by the member states of Tanzania, Uganda,
Rwanda, Burundi and DRC between 2006 and 2008. Institutionally, the Interstate Council of Ministers is
responsible for the cooperation, collaboration and mobilizing resources from the member states. The
Executive Board is composed of the Permanent Secretaries of Transport and one private sector
representative from each country (total of 10). It exercises supervision of the organization, the budget,
accounts and the Secretariat. The Stakeholders Consultative Forum is responsible for developing the annual
work plan, setting Corridor performance targets and monitoring them, marketing the Corridor and
appointing technical committees as required. It is responsible for the selection and operation of the
Secretariat. CCTTFA has the full authority and liaison with member Governments, while also having the
private sector as a driving force to improve the Corridor.

The objective of CCTTFA is to insure effective operation of transport, logistics and trade on the Central
Corridor in the interest of all member countries. With this mandate and public private partnership
structure, CCTTFA is ideally suited to promote the infrastructure, facilitation and legal and regulatory
framework improvements identified by the Corridor Diagnostic Study (CDS) to strengthen corridor
infrastructure and operations. The Secretariat has specialists on staff for infrastructure, facilitation and
trade who can monitor progress in achieving the Draft Action Plan as part of their duties. It also has some
resources provided by members. Nevertheless, they need assistance to develop a sustainable plan for
advocacy and fostering stakeholder actions for CDS-recommended improvements. This TA should be
integrated with the other facilitation TAs to build a sustainable way forward in terms of on-going corridor
improvements.

Current Status:

CDS quantifies the time, price and reliability of corridor transport and logistics operations and
recommends investments to make the corridor perform better. CCTTFA is currently finalizing staff
appointments and developing its work plan. CDS identifies issues that need to be addressed in the work
plan and recommends actions. An observatory is just being completed that will form a base line for
measuring performance results and for monitoring on an on-going basis. Under the East Africa Trade and
Transport Facilitation Project, CCTTFA has funding for a business plan study. The development of the
business plan and this TA should be coordinated so as to avoid duplication.

Description/ Major Components:

The assistance would consist of two parts, TA and workshop support. The TA would assist in establishing
a consultative public private process, based on observatory findings, to set the work agenda and commit
government agencies and private sector to responsibility for specific tasks to motivate and monitor
 A‐94

achievement of the CDS Action Plan. The CCTTFA Board and Stakeholders Consultative Forum, which
has equal public – private membership, would lead the process for CCTTFA and create the link between
the Facilitation Agency and national government action. CDS is providing broad visibility to a set of
investments and operational support through its stakeholder process and investor conference. Once
initiated, progress toward agreed CDS outputs would be assessed and redirected every six months. TA
would fund special CDS meetings for the first two years, and fund 50 percent for the third year as the
mechanism is made sustainable

Critical Factors for Success:

This initiative will be successful if all the participating members agree to devote time to specific tasks
because they are committed to the goals. This TA is intended to encourage active involvement from
CCTTFA members to form task forces to make the activities sustainable and to reduce the dependence on
outside consultants. CCTTFA needs to set up their operational structure and mode of operation. This TA
is designed to allow CCTTFA to pilot the methodology on several priority issues identified by CDS and the
Board and to do so in a way that the model is sustainable. It will also depend on member buy-in to be
successful.

Expected Benefits/ Impacts:

For CCTTFA, this TA would assist in determining and implementing their initial work plan. It would
address part of their sustainability issue by emphasizing leadership by members and minimizing use of
outside consultants.

Costs and Other Data:

Investment Duration Cost (US$

Component Start Year million)
TA 2011 12 months 0.15

Workshops 2011 36 months 0.15

TOTAL 0.3
 A‐95

No. OPER-TF-11 2011-2014

Name: EAC PPP Diagnostic and Institutional Building Study Action Plan Period:
Mode or Subject Area: All Modes and Facilitation Intervention Type: Operations
Corridor: Both Corridor Country(ies): Burundi, Kenya, Rwanda, Tanzania, Uganda
Agencies Involved: EAC, WB, TMEA
WB, TMEA
Related Projects (Donors):

Background/Rationale:

A successful PPP strategy depends on an amalgam of general factors which influence a country’s (or
region’s) investment environment and specific policy, regulatory and institutional measures which
governments must implement to provide an enabling environment for PPPs. Numerous authorities
emphasize that clear policies, enabling legislation, effective neutral regulation and strong institutions lie at
the heart of good governance in PPPs.

In the recent funding raising efforts by African Infrastructure Investment Manager (AIIM), the single most
challenging part of the process as described was not the investment merit of the continent, but rather
demonstrating where the money would be spent, i.e. a question of deal flow. Another related constraint
was the challenge to effect PPP projects, from idea to full closure, in the short political window of 4 years
before the political space and momentum changes. Other challenges included: the lack of a balanced and
clear risk allocation matrix; the lengthy process of risk identification, quantification and allocation due to
the complexity of projects; weak capacity of the public sector partners; lack of competitive and transparent
bidding processes; the need to complement transitional (sponsor) equity with upfront capital support and
subsequently with lower cost debt and equity refinancing for PPP projects, particularly after the
construction period.

This proposed diagnostic initiative will examine the roles currently and potentially to be undertaken by
EAC to support regional approaches and solutions to PPP investments. The diagnostic will look to identify
the potential roles the EAC can play in addressing the targeted market failures and responding to the
institutional and financing gaps identified by the private sector.

Current Status:

Draft terms of reference have been prepared and are expected to be undertaken as part of an EAC-World
Bank Group (WBG) – Trademark collaboration.

Description/ Major Components:

The potential role of regional institutions in developing PPP markets encompasses both upstream and
downstream aspects of the PPP project preparation cycle: (1) Legislative, Regulatory and Institutional
Framework covering also fiduciary (mainly procurement, financial management-such as contingent
liabilities- and safeguards practices); (2) Institutional Solutions for a potential EAC PPP Center of Expertise
(3) PPP pipeline and Project Development Facility (PDF) options; and (4) Financing mechanisms for PPPs.

Critical Factors for Success:

The project will require close collaboration between the WB team and the EAC staff and consultants.

Expected Benefits/ Impacts:

The technical assistance will produce the following outputs:

 A‐96

• Initial Advisory Notes/Reports on (i) PPP Policy-Making and Legislation and; (ii) Draft First
Mission Report providing initial review of Member State PPP Frameworks and Readiness – based
on EAC Stocktaking and field consultations and prospective EAC PPP Roles and Responsibilities
Options;

• A detailed Diagnostic Report will be organized in four chapters (see above) with a synthesis main
chapter including recommendations and proposed next steps. A dissemination workshop will
follow the publication.

• A Business Plan and Operationalisation Strategy for EAC Regional PPP Program.

Costs and Other Data:

Investment Duration Cost (US$

Component Start Year million)
TA 2011 12 months 0.45

TOTAL 0.45