Emirati logistics multinational DP World has officially announced what had already been finalised on paper but had been held back by dissenters resisting privatisation of Tanzania’s biggest port – a 30-year concession agreement worth at least $250 million in the agreement’s infancy.
The deal heralds a jewel in the UAE ports company’s logistics crown, especially from an East African perspective.
Although it may seem like a far-fetched comparison to make, overstating the Port of Dar es Salaam’s appeal, there can be no mistake that a certain kind of sparkle will be added to a port that has been hobbled by congestion and corruption for longer than anyone cares to remember.
The deal, which could grow to $1 billion in investment over the concession’s lifespan and could include infrastructural hinterland upgrades, was previously mired in controversy that even saw the involvement of Human Rights Watch.
That came after the government of Samia Suluhu Hassan threatened 22 protesters with arrest following comments made in opposition to Tanzania Port Authority (TPA) and its intention to privatise.
Eventually, three were arrested (*).
Focusing on the present, DP World group chair and CEO, Sultan Ahmed bin Sulayem, hailed the “visionary leadership” of Hassan and the opportunity to revitalise the port.
He said: “The development will deliver trade opportunities for the region, connecting East Africa and broader sub-Saharan Africa with global markets, driving economic growth, job creation, enhanced access to products and services, and creating value for all our stakeholders.
“Alongside other ports that we operate, this concession agreement marks another milestone in our collective efforts to leverage DP World’s global and local expertise to enhance the region’s supply chain to support the economic growth of the entire continent.”
A company statement, released following an official signing ceremony yesterday, said: “The concession to operate and modernise the Dar es Salaam Port was awarded to DP World with the primary objective of optimising the port’s operations to improve transport and logistics services throughout Tanzania and its hinterland.
“This is the first phase of a multiphase investment plan.
“DP World will initially invest more than $250m to upgrade the port and the investment could increase to $1bn during the concession period, alongside hinterland logistics projects.
“This investment will positively impact Tanzania’s socioeconomic development, in terms of job creation and increased access to products and services, among other benefits.”
Tanzania’s transport minister, Makame Mbarawa, said: “The signing of the concession agreement between the Government of Tanzania and DP World is a momentous event indeed, as it marks yet another significant breakthrough in building best-in-class infrastructure in Tanzania under the public-private partnership model.
“With DP World's expertise, the port will play an important role in supporting the creation of direct and indirect employment in various sectors such as transportation, distribution and supply chain. Importantly, the TPA will be a shareholder of the port concessionaire, and there will be no job losses for employees at the port authority.”
- Read this for context: “Tanzanian port privatisation dissenters arrested.”
