SPEECH BY H.E.

JAKAYA MRISHO KIKWETE, PRESIDENT

OF THE UNITED REPUBLIC OF TANZANIA, DURING THE WORLD ECONOMIC FORUMS ALIGNMENT MEETING ON DEVELOPMENT OF CENTRAL CORRIDOR HELD IN DAR ES SALAAM, TANZANIA, ON 15TH APRIL, 2 1! Hon. Dr. Harrison Mwakyembe, Minister for Transport, United Republic of Tanzania; Hon. Prof. ilas !wakabamba, Minister for "nfrastructure, Republic of Rwanda; Hon. #n$. %ir$inie &"'(, Minister for Transport, Public )orks and #*uipment, Republic of +urundi; Hon. ,ustin -alumba M)(.( ./0./0, Minister for Transport and )ater )ays, Democratic Republic of &on$o; Hon. #n$. (bra1am +yandala, Minister for Transport and )orks, Republic of U$anda; Dr. Donald -aberuka, President of t1e (frican De2elopment +ank; Dr. Ric1ard ezibera, ecretary /eneral of t1e #ast (frican &ommunity; Dr. to$omena Ta3, #3ecuti2e ecretary of (D&; Dr. "bra1im (. Mayaki, President, .#P(D ($ency; Mr. P1ilippe Don$ier, )orld +ank &ountry Director for Tanzania, U$anda and +urundi; Distin$uis1ed /uests; !adies and /entlemen;

It is a pleasure for me to welcome you all to Tanzania and Dar es Salaam. I thank the organizers for affording this rare opportunity to speak at this all important World Economic Forum on De"elopment of the #entral #orridor. This meeting could not ha"e $een organized at a $etter time% than this. s a matter of fact such people of this region ha"e $een waiting for frica meeting this type of action for a long time. &esides that% this meeting is part of the preparations for the World Economic Forum for scheduled for 'th to (th !ay% 2)*+. The work of this meeting will therefore ha"e a special significance to the implementation of the ,riority ction ,lan of ,rogramme for Infrastructure De"elopment in frica -,ID . which has its roots from the World Economic Forum in frica held in ddis/ $a$a% from (th to **th !ay% 2)*2. It is gratifying to see high le"el participation of four important institutions among us0 the E #% S D# the fD&% the 1E, D gency and the World &ank. It is heartwarming indeed% to ha"e you with us $ecause you are critical factor on the success of the agenda at hand. We look forward to your continued in"ol"ement until we reach the o$2ecti"es of this initiati"e. F"#$ WEF A%%&' A()() *# WEF A(+,)- P"&.)*/ S/0*#" )1% A2"&0)1 I12")'*"+0*+"/ D/./3#4$/1* lignment !eeting

Distin$uis1ed Dele$ates; The 2)*2 World Economic Forum for frica was a turning point with regard to how we approach the 4uestion of de"elopment of infrastructure in frica. It came to our awareness and realization that we need to $ring in ,ri"ate Sector in infrastructure de"elopment in frica% with each one trying to shoulder the cost alone. I commend the 2oint/initiati"e of the WEF% the #ommission and 1E, D -1ew ,artnership for for taking forward the agenda. s a follow up% an fD&% the 5 frica6s De"elopment. frican Strategic frica. Such a perspecti"e had not $een em$raced $efore $y go"ernments in

Infrastructure Initiati"e - SII. was formally launched in 7ohannes$urg on the (th of 7uly% 2)*2% with the formation of the &usiness Working 8roup -&W8.% a platform for strategies and initiati"es. I am pleased with the work of the &usiness Working 8roup for identifying pro2ects with high potential for short/term acceleration. I am particularly delighted with the choice of the #entral #orridor in this regard. #orridor. I$4#"*)10/ #2 *5/ T")1'4#"* C#""&%#"' I also thank you for affording my country the honour of preparing a Wider #oncept 1ote on the de"elopment of the #entral frican infrastructure de"elopment

Distin$uis1ed Dele$ates; The importance of transport corridors as game changers for regional growth and de"elopment need not $e o"er/emphasized. Studies after studies ha"e concluded that many landlocked de"eloping countries are among the poorest in the world. It is said% out of 3* such countries% *9 are classified as least de"eloped and half of these are in frica. These countries are said to $e penalized annually $y *.: percent reduction in a"erage growth compared to coastal states $y simply $eing landlocked. It goes without saying that0 growth of landlocked countries depends on the growth of the coastal countries. That implies the a$ility of the coastal countries to put in place infrastructure for trade facilitation% as a pre/re4uisite for de"elopment of the land locked countries. Distin$uis1ed Dele$ates; The coastal states ha"e ne"er fallen short of good will in facilitating the landlocked countries. They ha"e $een putting in place supporti"e infrastructure $ecause they too% are primary and secondary $eneficiaries of such infrastructure. It is the difficulties of raising financing of these infrastructures that has $een holding $ack coastal states particularly the ;east De"eloped #ountries% from rising to challenge effecti"ely.

Efforts to e<ploit 2oint regional financing mechanisms has also pro"en unsuccessful. E<perience has shown that it is easier to arrange in"estment for national infrastructure than for regional ones. =ur e<perience on the ongoing construction of 11,16! 7&3#$/*/"' of road to tarmac le"el ser"es as a good lesson. It is for this reason that% we welcome this approach of partnering with the pri"ate sector for regional infrastructure de"elopment. S*)*+' #2 C/1*")3 C#""&%#"' Distin$uis1ed Dele$ates; The #entral #orridor is located at the strategic geographical position which makes it a natural choice as a ma2or trade route for countries of the Eastern and #entral frican regions. Indeed% for many decades the Dar/es/Salaam ,ort% Tanzania>s roads and railways ha"e ser"ed the neigh$oring countries of 5ganda% ?wanda% &urundi and the Democratic ?epu$lic of #ongo -D?#.. Economies of countries ser"ed $y this corridor ha"e shown strong 8D, growth rates of $etween ! and 8 4/"0/1*. Transit demand is forecasted to increase from 2.6 $&33&#1 to 9.8 $&33&#1 *#1' $y 2)3). The Dar es Salaam port captures 1! 4/"0/1* of imports and e<ports of these countries. s a result the throughput at the port has increased from ' .! $&33&#1 *#1' in 2))' to 1: million tons $y Decem$er 2)*3.

The #entral #orridor also en2oys one of the $est roads in East frica. The Dar es Salaam/?usumo@Aa$anga and Dar es Salaam/ !utukula -at the $orders of ?wanda@&urundi and 5ganda respecti"ely. are fully pa"ed. The presence of these routes makes the #entral #orridor a competiti"e option for cross $order trade through the ,ort of Dar es Salaam. Distin$uis1ed Dele$ates; ?wanda and &urundi are connected to the ,ort of Dar es Salaam $y the #entral #orridor that consists of se"eral routes. These routes include an all/road unimodal option from Dar es Salaam to &u2um$ura and Aigali. lternati"ely% cargo flows along the intermodal routes made up of rail from Dar es Salaam to Isaka then trans/shipped to Aigali and &u2um$ura. ?wanda and &urundi are now working together with Tanzania to e<tend the central railway line from Isaka to Aigali on wards to Aeza B !usongati in &urundi. The ?epu$lic of &urundi has disco"ered enormous deposits of nickel. The corridor is a$out to transport more "olumes of hea"y minerals within the coming two to three years. =ur neigh$or &urundi may in the coming 2 or 3 years start e<porting $etween 1.5 $&33&#1 *#1' to : $&33&#1 *#1' of nickel concentrates a year. In the same de"elopment% we e<pect two nickel mines in Tanzania -Aa$anga and

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Dutwa. to $e operational in the same time span. It is likely that nickel processing would re4uire importation of huge "olumes of sulphur per annum. #orridor. C5)33/1;/' F)0&1; C/1*")3 C#""&%#" Distin$uis1ed Dele$ates; Despite the great potentials and opportunities presented $y the #entral #orridor% all is not rosy in terms of $oth effecti"eness and efficiency. Transport inefficiencies in this region% ha"e contri$uted to prohi$iti"ely high transport costs% and impede the region6s am$ition to realize its o"erall "ision for socio/economic de"elopment. The design capacity of the Tanzania ?ailway ;imited -T?;. line is to mo"e traffic of a$out 5$&33&#1 *#1' per year. 5nfortunately% this capacity has ne"er $een achie"ed as the ma<imum capacity reached so far is only 1.! $&33&#1 *#1' of cargo mo"ed $y train as the performance record in 2))2. While there are prospects of transit cargo to dou$le up within the coming few years% as the region $races itself to start e<porting millions of tons of copper and nickel a year% the e<isting 2,6 6 7&3#$/*/"' #entral railway% cannot in its present condition cope with the growing "olume of cargo along the central corridor. Distin$uis1ed Dele$ates; ll these "olumes are e<pected to pass through the #entral

It suffices to say% $oth our roads and the central railway line lead to the ,ort of Dar es salaam needs a turn around. It needs refur$ishing. We still need to e<pand our $erth capacity% modernize our cargo handling facilities as well as procedure to cope with the growing "olume of throughput. We ha"e indeed em$arked on the e<ercise% $ut in a limited way $y using our yearly $udgetary allocations and de"elopment partners6 support. Thanks to the World &ank% the fD& and 7I# . part from the measures we ha"e so far taken to enhance port efficiency% relia$ility and security. We thank to Trade !ark East frica% DFID and the World &ank for the continued support to impro"e port efficiency. E22#"*' U1%/"*)7/1 (< T)1=)1&) *# I$4"#./ *5/ C/1*")3 C#""&%#"' Distin$uis1ed Dele$ates; Tanzania has continued to fulfill her regional responsi$ility to our landlocked neigh$ors% and international o$ligations under the lmaty ,rogramme of ction. There are num$er of efforts we ha"e put in place which are short and long/term plans. =ur short/term plan is to reha$ilitate the railway line $y reinforcing its formation% strengthening its $ridges% remo"ing lighter% old% worn out rails% fasteners% sleepers and installing new hea"ier rails% sleepers and $allast. We ha"e so far done almost > 7&3#$/*/"'. Thanks to the World &ank and 7I# .

We ha"e continued to make a"aila$le our Dar es Salaam ,ort as an e<port and import gateway for the landlocked countries of ?wanda% &urundi% 5ganda% Dam$ia% !alawi and the D?#. Some of the initiati"es which are underway includesE

a. Dredging of the Dar es Salaam port entrance channelE $. #onstruction of &erths *3 and *+E c. Strengthening and deepening of &erths */'E d. De"elopment of the ?oll on B ?oll off -?=/?=. &erth at the Dar portE e. ,lan to de"elop Aisarawe Freight Station with intention to decongest container traffic at the Dar port and de"elopment of new port at &agamoyo among others.

The go"ernment decided to gi"e due weight to these initiati"es through mainstreaming them in the &ig ?esults 1ow -&?1. ,ort Initiati"es% with the aim to ensure their timely implementation. We ha"e earmarked to increase throughput of the Dar es Salaam ,ort from the current 1: $&33&#1 *#1' per annum to a$out 18 $&33&#1 *#1' annually $y end of 2)*:. Furthermore% it is targeted to reduce time taken $y a truck

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to transport a transit container from the Dar es Salaam ,ort to the $orders of &urundi and ?wanda to 2? %)<' from the current :? %)<' $y the end of 2)*:. Distin$uis1ed Dele$ates; &ut these short/term measures will not ena$le us to ser"ice a growing regional economy effecti"ely and efficiently. The Dar es Salaam ,ort for e<ample% currently handles 1: $&33&#1 *#1' of freight per year $ut hardly 2 4/"0/1* of the freight is carried on rails% the rest is transported $y trucks% drastically shortening the lifespan of most of our pa"ed roads. It is against this $ackground that we came up with a long/term plan or strategy to upgrade the central line to standard gauge. ,art of the line i.e. Dar es Salaam B Isaka B Aeza B Aigali@8itega B !usongati -*%:(* kilometers long.% is a 2oint pro2ect $y Tanzania% ?wanda and &urundi. It is estimated to cost us a minimum of USD !.1: (&33&#1. We ha"e 2ointly done all the preliminary studies. With the completion of the detailed study recently% we are now on procurement of Transaction Thanks to the fD& for its support. Tanzania and &urundi ha"e also a $ilateral arrangement to construct a 2)) kilometers standard gauge railway $etween 5"inza in d"isor.

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Tanzania and !usongati in &urundi e<pected to cost us 5SD ::) million. P"&.)*/ S/0*#" )1% C/1*")3 C#""&%#" Distin$uis1ed dele$ates; The central corridor pro2ects I ha"e $riefly narrated cannot $e successfully implemented within the conte<t of the traditional method of financing infrastructure de"elopment. 8o"ernment financing alone may not easily raise all the money re4uired. We do not ha"e the money nor can we easily get someone to lend us so much money. We ha"e tried this option o"er the years without much success. It is time we encouraged further pri"ate sector participation. It remains an alternati"e and "ia$le option to minimize the pu$lic financing gap in infrastructure de"elopment. I ha"e "ested my hopes in this meeting which I $elie"e will take us to the ne<t le"el in terms of unlocking pri"ate sector funding% identifying cross/$order regulation gaps and $uilding pri"ate/pu$lic sector confidence. Distin$uis1ed Dele$ates; It is $efitting that this alignment meeting is taking place at this point in time. We ha"e undertaken to put in place conduci"e en"ironment to facilitate pri"ate sector to 2oin our efforts. The go"ernment has put in place the 1ational ,u$lic/,ri"ate ,artnership

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-,,,. ,olicy in 2))(% in 2)*) we enacted the ,u$lic/,ri"ate ,artnership ct% #ap +)3 and ?egulations in 2)**. In addition% feasi$ility studies ha"e $een undertaken while "arious identified ,,, pro2ects ha"e $een ad"ertized for pri"ate sector to show interest. We will continue to work together with our #entral #orridor mem$er states in soliciting funds to in"est in the key transport infrastructure pro2ects along the corridor. The 8o"ernment% in partnership with the =E#D and 1E, D% undertook a re"iew of its in"estment policies to support the national strategy for economic reform and impro"e the $usiness climate to attract more in"estment in key sectors% such as infrastructure and agriculture. The re"iew was launched on 3*st 7anuary% 2)*+ and will $e used to update all in"estment policiesE and continue with implementation of 8o"ernment ?oadmap on the Impro"ement of the In"estment #limate $y undertaking administrati"e measures with "ery limited cost implications while reducing hurdles of significant costs to local and foreign in"estors. These measures go along with automated and electronic payment systems that minimize human interference and discretionary powers. W)< F#"@)"% Distin$uis1ed Dele$ates;

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I am optimistic that the groundwork we ha"e undertaken as a region for the implementation of the #entral #orridor Infrastructure pro2ects through pu$lic pri"ate sector cooperation ha"e caught the attention of the international $usiness community. I thank the WEF in colla$oration with the fD&% the 5 #ommission and 1E, D for frica6s economic de"elopment. s championing this no$le cause for

corridor mem$er states with a lot to gain from impro"ed inter and intra/ regional trade% let us continue to plan% discuss% decide and implement together our infrastructure de"elopment pro2ects. =ur num$ers would always attract the attention of serious in"estors. C#103+'&#1 Distin$uis1ed Dele$ates; I am optimistic that our regional efforts to implement the #entral #orridor Infrastructure pro2ects through pu$lic pri"ate partnership is now at a point of take/off and definitely will $ear good results in the "ery near future. We $elie"e that WEF strategies under this new model of #entral #orridor to $e the frican pilot pro2ect for accelerating in"estments will support the current potential infrastructure pro2ects along the corridor to secure strategic in"estors soon. What I wish to share with our colleagues from the #orridor mem$er states is to continue working together under these efforts so as to achie"e the e<pected

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regional in"estment goals. E"erything is possi$le if we plan% discuss% decide and implement together. This is the opportunity for our go"ernments to interact with other stakeholders including the pri"ate sector% with a "iew to coming up with a programme of action for the de"elopment of the central transport corridor. To conclude my remarks% I ha"e taken note of the fact that you ha"e a rather long and demanding agenda in front of you and% for that reason% I wouldn6t like to keep you any longer than necessary. It is therefore my singular honour and pleasure to wish you a "ery fruitful meeting and to declare that the #orridor is now opened. lignment meeting on the #entral