Railways look to private sector for funding

While governments in
southern Africa may
not have embraced
privatisation, they
are increasingly looking to private
sector participation to help fund
upgrades to equipment and
infrastructure.
According to Charles Batize,
minister of works and transport
for Tanzania, the Tazara Railway,
which is 100% owned and
operated by the government,
is changing its policies to
allow private operators to sell
cargo-carrying options to
their customers, using Tazara’s
services.
“We found that the operations
ran at a huge loss during the
privatisation period so we
reverted to making our railways
100% government-owned,” he
said.
Transnet Freight Rail (TFR),
meanwhile, has designed a
private sector participation (PSP)
model which can be used as an
alternative procurement option
for mega projects, according to
TFR funding consultant,
Patrice Vusi.
Marketing director of
Realty Africa in Zimbabwe,
Carlo Chima, told FTW that
a Dutch-owned company was
introducing crowd funding
options for major projects
in Africa. “Funding options
are opened up to multiple
third parties via the social
media, almost the same way a
stokvel would operate, which
considerably lowers the risk of
investment and banks are more
liable to support this kind of
investment platform,” he said.
He quoted the World Bank
as saying recently that southern
Arica had a crowd funding
potential of up to US$2.58 million.