[SIZE=6]Tanzania’s China-backed $10bn port plan stalls[/SIZE]
THURSDAY MAY 23 2019
https://www.theeastafrican.co.ke/image/view/-/5127688/highRes/2351945/-/maxw/600/-/cwffj8/-/Dar.jpg
Dar es Salaam is a major port and city in Tanzania. A plan to build a port in Bagamoyo to decongest Dar es Salaam has stalled. PHOTO | FILE | NATION MEDIA GROUP In Summary
[ul]
[li]In 2013, Tanzania signed a framework agreement with China Merchants Holdings International to build the port and a special economic zone.[/li][li]But Tanzaia says the conditions given are not economically viable, hence it has written to the firm over the disputed terms.[/li][/ul] By REUTERS More by this Author
A planned $10 billion port project in Tanzania backed by China has hit an impasse, with the two sides disagreeing on terms of the infrastructure investment, a senior Tanzanian port official said on Wednesday. TALKS
In 2013, Tanzania signed a framework agreement with China Merchants Holdings International, China’s largest port operator, to build the port and a special economic zone that aims to transform the east African country into a regional trade and transport hub.
“The conditions that they have given us are commercially unviable. We said no, let’s meet halfway,” Deusdedit Kakoko, director general of the state-run Tanzania Ports Authority (TPA) told Reuters.
“It would have been a loss … they shouldn’t treat us like schoolkids and act like our teachers.”
The Tanzanian government has officially written to the Chinese port operator on the disputed terms, Kakoko said. “We are waiting for them to begin new talks. When they are ready, we will resume the negotiations.”
China Merchants said in an e-mailed statement to Reuters that many years of negotiations with the Tanzanian side had failed to result in a legally binding agreement.
“This project is a purely commercial, investment project and China Merchants Port has in its overseas investments always followed the principles of commercial feasibility and win-win cooperation,” the company said.
The Chinese foreign ministry did not immediately reply to a request for comment. NEGOTIATIONS
Since taking office in late 2015, President John Magufuli’s government has sought to renegotiate major deals with foreign investors in mining, natural gas, telecoms and infrastructure projects as part of a new resource nationalism drive.
The deal for the Bagamoyo port was signed in 2013 by the government of Magufuli’s predecessor, Jakaya Kikwete, during a visit of Chinese President Xi Jinping to the country. It is also financially backed by Oman’s State General Reserve Fund.
Members of Parliament demanded explanation from the government last week on delays in implementation of the project. A ground breaking ceremony for the project was held in late 2015 but actual construction of the port is yet to start.
The port, to be built in Bagamoyo, 75 kilometres north of Dar es Salaam, would dwarf neighbouring Kenya’s port at Mombasa, east Africa’s trade gateway some 300 kilometres to the north, and include an industrial zone and rail and road links to a region hoping to exploit new oil and gas finds.
It is meant to ease congestion at the port in the commercial capital Dar es Salaam and transform a depressed area into a trade and manufacturing hub. Yet there are practical difficulties, not least that Bagamoyo’s port, unlike Dar es Salaam’s, would most likely need regular, extensive dredging.
Countries are starting to question these “development” projects. In the other hand,if in Kenya we questioned these projects, @spear and others like him would be out of jobs so we decide to shut up…ndo mtu wetu akule.
And the day they slow down on competing with us is the day we will slow down on debts. Kwa sababu hata sisi tuna ufala. Some of our development projects we do them kujionyesha na kunyamazisha our poorer neighbors (Tanzania) rather than kutosheleza our necessities. Konza City comes to mind here.
The port didn’t make economic sense since there is no cargo to handle there. Dar port handles 7-10 million tons and 60% of it terminates in Dar itself. 40% goes to to interior and export to Zambia, DRC, Malawi and Rwanda. So another port will handle what cargo? It was not feasible especially for a big cost price. This was just development by renders. Something Tz specializes on.
Another problem to admit is the oil pipeline is not moving 4 years after. Nobody will invest in Tz in the next 3-4-5 years. They await to see if megafools will change his nationalist policies after he wins the elections by 100% that will be next year. Investors are worried they can lose their assets, business and investment overnight and they can’t seek reprieve anywhere in the country. He directly controls the executive, judiciary and Parliament.Last month M7 flew over Total MD from France to visit UG for those oil talks but he left empty handed. Total has decided to hold and wait as they negotiate more. Exxon Mobil has sold its huge gas block that they discovered gas since they said they can’t commit to invest in it by 2025. That meant instead of holding to that long, they sold it to Norway firm and left.
Wakuje tuwapatie Kwale port wajenge by PPP at Shimoli. Its in the KPA master plan. Meanwhile Lamu port construction is on schedule. Three firms are now fighting to buy into it, Transnet SA, Dubai World and CCCC. It very complex negotiations since whoever is picked must show financial resources to build the other 32 berths in stages.
Skyscraper is just one platform. I know a lot of the players at Kenya HQ, however you have to enjoy reading voluminous reports to understand the whole scope of the projects. If someone wrote it, I will get it somehow.
Sometimes staying quiet hides your ignorance,
The pipeline project sio suala la handshake ama huduma namba that you expect to build in a daytime,
Many of Ignorant kenyans like you will think the same way, there are lots to be done prior to seeing the groundwork, people cant just rush dili la $4bn, My classmate returned last week from site where they were completing their environmental studies,
Halafu, Wakenya mmezoea miradi ya Wachina ile hainaga Feasibly studies wala Environmental studies like SGR, yaani design inatoka china, drawings from China, Finencer China, Consultant China, Wtf.
a reason Animals get killed by that madaraka Garimoshi in Amboseli on daily bases,
Last few weeks I heard Kenya built a pipeline and at the end realizing the need of anti leaking system,
How on earth in this modern world you build a pipeline without thinking of anti Leakage system??
I also heard Kenya planning to electrify SGR my Dick, thats a typical poor planning realized in Kenyan Heads…
Hayo ndiyo mambo ya kukurupuka kwa Wakenya na Vionhozi wenu,
When you plan for a project that is going to stay there for 100 years, calm your asses down, plan and Implement, Dont rush things,
I saw mnachora ile thika road na kuita ONLY BRT, how has this ended by the way?
Calm your tits man, you will get a heart attack. Do the reports etc. However Stanbic SA whom you picked to look for investor’s into this project informed UG and Tz state house that they have not gotten any interest. They were asked to consider floating a international bond to raise finances for it AKA commercial loan. Talk is cheap where is the finance?
M7 will not wait forever, he is facing a resurgent opposition and its now 2 straight elections he promised them oil benefits. If he goes for the 3rd elections next year and hasn’t exported a drop then you will know things will change.
It would be great if TZ and our dysnfunctional nation could get along, healthy competition is great, rivalry is excitingbut we take it too far with this senseless inferiority-superiority battles which only breed hate and resentment.
We should have negotiated for this massives infrastructure projects that traverse all our nations like the SGR and the pipelines and the huge highways, thanks to our big egos we are being played by multinationals.
It is incorrect to claim that the port cannot gather enough cargo. No investor would agree to commit upwards of $10 billion without a high degree of certainty on the viability of the project. If completed, the port would serve a vast catchment area from Central Africa to Southern Africa. It could even go as far as serving Uganda considering that it will be designed to incorporate state-of-the-art technology. It could easily outstrip existing ports in terms of efficiency.
Kama ungekua creditor ungefanya nini?
First the chinese have shown belief in the project by agreeing to finance it. But it seems wakaulizana maswali na Tanzanians, suppose future traffic and business will not be as we invisage, mtakubali tuendeshe port according to how we deem best? Tanzanians wanakataa. Kwa sababu hao experts waliobobea wamemwambia president kuwa it’s true, business inaweza kua haba. So, sema wewe, who lacks faith in the project? Tanzanians want all risks to be borne by the Chinese while they play it cheeky!