New era for Dar es Salaam Container berths

Negotiations reportedly took place right up to December 2022 but the TPA formally took over the facility on 1 January 2023 with Adani Ports & SEZ appointed as what TPA describes as a service contractor on a monthly fee basis.

Hutchison’s exit took place against a background of a strained relationship with the TPA. There had been financial tensions a few years back – in September 2017, the late President John Magufuli instructed the TPA to review its contract with Tanzania International Container Terminal Services Inc (TICTS), Hutchison’s Tanzania business unit, with this resulting in a doubling of annual fees to the port authority, from US$7 million to US$14 million. The agreement between the two parties was also cited by Prof. Musa Assad, Controller & Auditor General, National Audit Office of Tanzania, 2014 – 19, as having major defects.

At a performance level there have also been regular problems relating to vessel berth waiting and container dwell times.

Typically, in February 2020 waiting time for a berth at TICTS was reported by Hapag Lloyd as between 16 to 19 days and as recently as December 2022 as 8 to 10 days by Maersk. Not all of the congestion generating problems can be sourced to TICTS – there have been negative impacts from diverse sources: Customs’ requirements, inland depot operations, truckers, container scanning requirements etc. but, as often happens to terminals, TICTS ended up ‘in the eye of the hurricane.’

External agencies such as the World Bank have in the past also criticised the port’s performance – suggesting that it can do better both in the context of serving Tanzania and the surrounding landlocked countries via the Central Corridor – Malawi, Zambia, Burundi, Rwanda, Uganda, and Eastern DRC.

Looking to the future, Plasduce Mbossa, Director General, TPA, has made it clear that the port will endeavour to find a new investor for Dar es Salaam’s container terminal. Equally, he emphasised when he took up his post, in mid-2022, that working with private sector companies to deliver a high level of efficiency is a priority and as such this goal is expected to figure large in the operator selection process for the container terminal. There is no word yet on the precise process that will be employed to achieve this but the logical path, especially given the desire to improve efficiency, is an international tender based on a multi-criteria bid – technical and financial aspects.

There have also been reports that the TPA is considering offering a concession for berths 5 to 7, in addition to berths 8 to 11 for the container terminal.

TPA currently operates berths 5 to 7, where approximately one third of the port’s annual container volume is handled as well as a variety of other cargoes. One option could be for the TPA to consider offering all these berths as one concession which would provide economies of scale and could offer advantages in pursuit of higher levels of efficiency. It would also give more flexibility to TPA in conjunction with its planned berth upgrade works at berths 8 to 11. Berths 1 to 7 have recently been reconstructed and provided with a depth alongside of 14.5m.