VICTORIA FALLS, ZIMBABWE
12TH NOVEMBER 2008
OFFICIAL OPENING SPEECH BY THE HONOURABLE CHRIS
MUSHOHWE, MINISTER OF TRANSPORT AND
COMMUNICATIONS
President of the Southern African Railways Association;
Vice President of the Southern African Railways Association;
Board members of the Southern African Railways Association;
Representatives of the Chief Executives of the various Southern African
Railways Association member organisations;
National Railways of Zimbabwe Board members here present;
Distinguished guests
Ladies and Gentlemen:
It is an honour and priviledge for me to be invited and be part of these SARA proceedings in Victoria Falls. Let me begin by welcoming you all to Zimbabwe and to our prime resort of Victoria Falls in particular, one of the Seven Wonders of the World. I wish to specifically extend my special welcome to those of you who have come from way beyond the borders of the republic of Zimbabwe. Zimbabwe is proud to host this important meeting during a period when expectations are very high for railways to effectively perform and contribute to regional economic development.
Railways in the region and the continent at large are currently facing serious capacity constraints arising from lack of investment, ageing infrastructure, obsolete equipment, skills drain, HIV and AIDS against a background of increased demand for railway services. To alleviate the challenges, the African Transport Ministers responsible for railways came up with the Brazzaville Declaration in April 2006. The Brazzaville Declaration is a clear demonstration of African Governments’ commitment to support investment in railway infrastructure development, equipment and improvement in operations by providing a sustainable framework to address current challenges that are militating against railway performance. It is my sincere hope that your deliberations will give due regard to this continental consensus and help provide solutions to current transport problems and challenges facing governments of the SADC region and the railway industry at large so as to achieve sustainable solutions.
As part of the global village, SARA’s contribution will impact positively on SADC and the whole continent of Africa more so given that the challenges facing SARA are similar to those identified under the Brazzaville Declaration. The Algiers Declaration which was as a result of the first Session of the African Union Conference of Ministers Responsible for Transport that took place in Algiers in April 2008 reinforces the important role that railways play in economic development and the need to revive the sector.
The formation and functioning SARA is part of the implementation of the SADC Protocol on Transport, Communications and Meteorology and this being the case challenges facing your organization are of concern to all. There are high expectations from the SADC Integrated Committee of Ministers (ICM) on the need for SARA to benchmark and enforce operational and technical rail service standards; co-ordinate, evaluate and strategise for regional railway operations; to promote a cost effective, regionally integrated and efficient seamless rail service in order to stimulate trade among SADC members and enhance SADC competitiveness in international markets.
Railway safety remains paramount to your service delivery and therefore you should in your operations strive to observe and sustain the highest level of safety awareness for your own benefit and that of your customers. Needless to say that accidents destroy the very core of railway business, that is infrastructure and operating equipment and hence capacity.
My Ministry has and continues to take some steps to improve railway performance. These include among others the following:-
i. Attempts at leveling the playing field/ policy changes
The playing field in the transport industry is skewed in favour of road. While the government is responsible for the maintenance of roads, (albeit a token payment from road users through road access fees), the situation is different when it comes to rail. The railways are solely responsible for the maintenance of their infrastructure. In an attempt to level the playing field, the Government of Zimbabwe made some policy changes vide the Railway Amendment Act of 1997. This piece of legislation, among other things, aimed to facilitate the transfer of rail infrastructure maintenance from the Railways to the Government. Admittedly and unfortunately, enacted changes have to date not been substantially operationalised. The Government however participates in railway infrastructure programmes through annual Public Sector Investment Programme (PSIP) allocations for specific critical projects. The railways are also prioritized in any invention programmes that are embarked on by the Government or the Central Bank from time to time.
Another area that the railways had a big challenge in the past when compared to their road competitors was on the pricing regimes. In the past, the railways were not permitted to exceed certain rates/fares even if they were below the cost of providing the services. Through the Amendment Act that I have already alluded to, the railways can now recover their cost and make a reasonable return in their costing structures.
ii. Consessioning
Rail performance has also been enhanced through part concessioning of the network. The Government of Zimbabwe was faced with the dire need to shorten the rail route between bietbridge and Bulawayo as well as to upgrade the portion of the existing line between Heany Junction and west Nicholson. To facilitate this, it awarded New Limpopo Projects Investments (NLPI) a 30 year Built-Operate-Transfer concession which led to the construction of a new 150km line between Beitbridge and West Nicholson and the upgrading of the existing West Nicholson to Heany Junction line. This resulted in the shortening of the rail distance between Beitbridge and Bulawayo by 152km.
iii. Strategic Partnerships
The awarding of a BOT concession to NLPI that I have just spoken about is an example of strategic partnerships that my ministry has and continues to pursue. These efforts are against the backdrop of heavy financial outlays that are required in railway projects pitted against limited fiscal capacity to fund them. To this end, more strategic partnership opportunities continue to be pursued and the ministry has held several discussions with a number of potential rail partners from all over the world.
iv. Public-Private Sector Partnerships
Back in 2003, my ministry approved the Public-Private Sector Partnerships programme in recognition of the fact that NRZ had a wide base of locomotives and wagons, a good number of which unfortunately were out of service due to incapacity by the NRZ to import the requisite spares to roll them out. To this end, NRZ was given authority to court some of its major customers to provide foreign currency for the spare parts and once the resources are rehabilitated they are then dedicated for the sole use by the customer who would have supplied the foreign exchange. The foreign exchange supplied will be recovered by the customer through monthly offsets, at agreed levels, with the railage due to NRZ for the movement of the participating customer’s cargo. I am glad to note advice that, through this initiative up to 10 locomotives and over 1 000 wagons have been brought back into service since the inception of the programme.
v. New Resource Acquisitions
Realizing the dire need for recapitalizing the NRZ my ministry facilitated the signing of agreements between NRZ and CNR of China for the supply of new locomotives, commuter train sets and mainline passenger coaches. With the assistance of the Central Bank the NRZ has so far made part payment of the required down payment towards the purchase of these new resources. Concerted efforts are currently being made by the ministry to secure lines of credit for the full purchase price.
vi. Construction of New Links
The development of a railway link between the satellite town of Chitungwiza and the capital city of Harare is critical in alleviating the transport challenges facing the travelling public and enhancing the growth of industry in Chitungwiza. In this regard, the NRZ and the Department of Roads have been assigned to carry out route surveys to facilitate the construction of this project. In the meantime my ministry is working flat out to secure strategic partners to finance this important project, which is obviously again beyond the NRZ’s sole means.
vii. Enhancement of rail-road complementary services
One of the challenges of rail is its inability to offer door-to-door services. In this regard there is need for road to complement rail to provide a feeder service. In an effort to enhance this rail road complimentary service the government through the ministry in 2007 facilitated a government-to-government bilateral arrangement with China for the provision of funding for the acquisition of new lorries for Road Motor Services (Pvt) Ltd, a subsidiary wholly owned by the NRZ.
I am advised that in your deliberations today, you will consider and review among others, the performance of regional rail corridors, development of technical standards, projects, skills development and retention, resource sharing and utilization, SARA 2009 budget and other financial matters, ways in which governments can assist railways, the SARA Railway Conference and admission of new members. I have no doubt that your agenda dovetails into both the SADC Protocol on Transport and Communications and the Brazzaville Declaration and I want to urge you to successfully progress these issues with the ultimate goal of coming up with a comprehensive regional framework to ensure the provision of an efficient, integrated and cost effective seamless rail transport service.
May I take this opportunity to urge you to strengthen your cooperation through information sharing and exchange, sharing of operating resources to alleviate shortfalls among members. The diverse nature of your membership provides opportunities for synergies that will benefit the railways, their customers, suppliers and the SADC region as a whole. There is no doubt about the demanding task that is before you but I am very confident that you will be equal to the task by meeting the objectives of your meeting. Apart from your demanding schedule ladies and gentlemen, may I also urge you to use this opportunity to view our Victoria falls and the abundant wildlife in and around this beautiful town.
May I once again say welcome to Victoria Falls and welcome to Zimbabwe. You are most welcome and therefore feel at home. I wish you success in your deliberations and a safe stay in Victoria Falls.
On that note ladies and gentlemen, I wish to declare the 27th SARA Board meeting officially open.
I thank you.
