Sunday, 18 June 2017

The Central Corridor is no Option for Uganda

Ugandan Line designed  for Double tack wagons
 Tanzania’s efforts to woo Uganda to abandon its Railways link through Kenya in favour of the Central Corridor have come to naught, we ca report. A paper, by the Uganda Ministry of Works and Transport has dismissed the route as a low priority route for Uganda.

The document, seen by this publication also defines the key factors in the decision to invest in a modern railway line.

Top on the agenda is savings in transit time, robustness, reliability, and maintenance costs in that order.  In all these variables the central Corridor -which traverses Tanzania- scored poorly, making it a no option for Uganda.

The paper, an analysis of the SGR projects in East Africa, demonstrates why the central Corridor is not an option for Uganda. It demonstrates that the Central line is three days slower than the Northern Corridor even if they are built of the same standard. Dar-Es-Salaam port is 1548 Km away from Kampala compared to Mombasa port which is 1250 km away.
This is an expensive but reliable model

Of the 1548 Km, 1228Km are on land and 320Km are on water- across Lake Victoria. This in itself calls for investment in sea-going vessels and improvement of the Ports in both Mwanza in Tanzania and Port bell in Uganda.

Even with these investments, the document demonstrates, the Tanzanian route in not an option for Uganda whose ambition is to be a middle income country with a GDP per capita of $9500 a year by 2040. To get there, Uganda needs to attract investment into heavy industry producing “for high-end markets in Europe, North America, Asia and other developed countries.” Consequently it needs fast, reliable, robust and efficient transport system

 In terms of robustness of the line, the paper demonstrates that the Northern corridor SGR, which is Class One Chinese standard, has a capacity of transporting more than 8000 containers per day in 40 trains each carrying 216 containers. The Tanzania route on the other hand, is restricted to 216 containers due to vessel restrictions.

 It will take 5 ferries to carry the 216 containers for the 320 km trip across Lake Victoria. Each ferry has a capacity of 44 containers. To off load and load and transport the 216 containers across the Lake will take an additional 15 hours, says the paper.

This will raise the total transit time on the Tanzanian route to more than 72 hours. And the report adds a caveat, “that is being optimistic.”  To the contrary, the Kenyan route will take 24 hours to transport freight from Mombasa to Kampala, it says.

Comparing the Ports capacity, the paper says that the Mombasa port is three times bigger than the Port of Dar-Es-salaam. The paper, though, was published before Tanzania inked the deal to expand the Dar- port.

The paper says that the central corridor is not popular with Ugandans who transport only 0.5 million tons of freight per year compared to the Northern Corridor which ships more than 10 million tones a freight a year.

 It questions Tanzania’s contracting mode which, it says, places a lot of risk on the employer- in this case the Tanzania government. The Model- Design and Build- is fraught with risks due to potential for design and construction errors that could impact negatively on train operations. 

The Ugandan Model is ECP/Turnkey which places all design and engineering risks on the contractor. Here the Contractor purchases the Materials and Equipment including Locomotives and Commission’s them.

In terms of reliability, the paper tears apart the Tanzanian and Ethiopian lines. Both are low quality compared to the Northern Corridor SGR. The Ethiopian line is Class 2 Chinese standard while Tanzania opted for AREMA standard. Both are designed to carry a maximum of 20 million tons a year. The Northern corridor -which traverses Kenya-is designed to ship up to 35 million tons a year.

 The implication here, says the paper, is that should demand for railway services rise in both Tanzania and Ethiopia, they will have to build additional lines to meet demand.  The Northern Corridor line, is sufficiently robust to accommodate future demand increases.

The paper advises that for projects designed to last 100 years, the initial sunk capital should not inform the decision to invest. It argues that the life time maintenance cost of a project should inform the decision. In the case of SGR says the paper, the Maintenance cost for the Class one line are lower than the other two.