Tanzania and Dubai are expected to debate and approve an Intergovernmental Agreement (IGA) with United Arab Emirates logistics major Dubai Ports World (DP World) for the development of Dar es Salaam Port. This was revealed by the Minister of Construction and Transport, Professor Makame Mbarawa.
This will set the stage for other procedures, including the concession agreement, before the commencement of a new chapter for cooperation between the Tanzania Ports Authority (TPA) and DP World, a multinational logistics company based in Dubai, the United Arab Emirates.
DP World is one of the largest companies in the world with success in the operation of ports in various countries.
In the year 2022 alone, DP World earned a revenue of $17.1 billion and a profit of $5 billion.
In Africa, DP World operates in Algeria, Angola, Djibouti, Egypt, Mozambique, Nigeria, Rwanda, Senegal, Somaliland and South Africa.
DP World has invested more than $1.8 billion in the African continent in the last ten years and plans to invest $3 billion in this continent in the coming years.
The Government of Tanzania expects to sign an agreement with the Government of the United Arab Emirates (Dubai) for economic and social cooperation for the development and improvement of the operations of Tanzanian ports.
The agreement comes after the Tanzania Port Authority (TPA) entered into a Memorandum of Understanding (MOU) with DP World last year.
DP World Rwanda
DP World signed an MoU with Rwanda where DP World Kigali was established on 21st October 2019. It became East Africa’s first-ever Inland Dry Port and Logistics Hub which was aimed at expanding e-commerce across the East Africa Community and beyond and strengthening commercial trading links between the UAE and Rwanda.
Rwandan farmers have easy access to UAE and other Gulf markets through DP World services.
DP World Kigali accesses two secure trade gateways for eastern Africa, the port of Mombasa in Kenya and Dar es Salaam in Tanzania as well as wholesale e-commerce platform DUBUY.com
Where it started
Private investment in the Port of Dar es Salaam is not a foreign concept.
The private company TICTS has operated the container area of the port for more than 30 years until last year when the Government of Tanzania decided not to continue the contract in order to look for another foreign strategic investor.
The port of Dar es Salaam is the main commercial gateway of Tanzania. Approximately 95 percent of Tanzania’s international trade is served by this port.
The port of Dar es Salaam serves neighboring landlocked countries such as Zambia, the Democratic Republic of the Congo (DRC), Burundi, Rwanda, Malawi, Uganda and Zimbabwe.
The arrival of DP World is expected to increase the efficiency of the port in Dar es Salaam and bring a large burden that will increase government revenue.
The port of Dar es Salaam is in competition with other ports on the African continent, including ports in South Africa, Mozambique and Namibia.
The port of Dar es Salaam expects to serve cargo of 20 million tons for the year 2022/23, while the port of Durban in South Africa is serving cargo of more than 31 million tons per year.