FRANCIS LUNGU, Lusaka
THE introduction of a government Statutory Instrument (SI) to compel 30 percent of heavy cargo to be transported by rail within the country has been received with varied reactions by bulky goods consumers, manufacturers and transporters.
Government in this move aims at relieving pressure from the road infrastructure and to prolong road network lifespan and on the other hand, revamp the rail subsector.
Minister of Transport and Communications Brian Mushimba said the SI that comes into effect before the end of February, will see the movement of 30 percent of all bulky and heavy cargo from road to rail within the country.
Initially, the SI was supposed to have come into force in October, 2017 but the consultation process was extended to involve as many stakeholders as possible.
But on January 26 this year, Mr Mushimba in the presence of the Zambia Railways board and management members, announced that the SI would into effect in 30 days.
Mr Mushimba said the engagement with businesses in different sectors of the economy transporting heavy and huge volumes of goods would lead to the smooth implementation of the law for the 30 percent of cargo to be going by rail.
“Examples of the bulky and heavy goods [currently being transported by road] would be the big spare parts that the mines consume, copper and cobalt concentrates, sugar, coal, sulphur, fuel, fertilisers and cement, especially for Dangote that move up and down [between] Copperbelt and Lusaka,” Mr Mushimba.
The move has of course delighted Zambia Railways and other players in the rail sector that have seemingly struggled in terms of business volumes transported via rail infrastructure.
“This is one of the milestones we were given by the ministry and the government that we will enhance and revitalise the railway system so that we can reclaim our role in the transport sector,” said Zambia Railways board chairperson Lubinda Linyama.
Workers Union of TAZARA (WUTAZ) president Bedwin Malowa said the union was elated by the development and anticipated that volumes of cargo moved by rail would now increase, translating into upped incomes.
“This will help improve on the traffic volumes we haul as TAZARA. Currently, the volume hauled by TAZARA are so low that the company even fails to fulfill its obligations such as paying salaries for its workers and other statutory obligations, hence making this move commendable,” said Mr Malowa.
To the contrary, the new SI has attracted indifferent reactions from market players hauling bulky and heavy cargo on the road across sectors of the economy.
For instance, the Zambia Chamber of Mines with its mining companies’ membership, feel the SI does not take into consideration the interests of the mining sector.
“Though, we acknowledge that consultation with the mines by the Ministry of Transport and Communications did occur, the mining industry’s position has been ignored…the Copperbelt rail infrastructure in existence is in poor repair, lacks capacity, lacks adequate security provision and certainly lacks resilience,” Zambia Chamber of Mines deputy chief executive officer Talent Ng’andwe indicated in a statement.
Mr Ng’andwe argues that there was no evidence that economics of rail transport would be better than road and that promoting cost-effective solutions was important especially when logistical costs were expensive in the case of Zambia, a large and landlocked country.
“In the interest of a free-market where competition is allowed to flourish and so promote efficiency…rail freight should compete on a level playing-field with road transport without the unfair advantage of enforced quotas,” he said.
Players like Dangote Industries for instance, with a daily cement production capacity of about 4,500 tonnes, translating into 1.6 million tonnes of cement per annum, say they are ready to comply with the new SI provided it considers the state of the rail infrastructure and the capacity of Zambia Railways to handle the undertaking.
Peter Lazarus who is Dangote Industries head of sales says his cement manufacturing and distributing company was okay with the SI as long as Government took into consideration the effectiveness of rail transport.
Dr Lazarus in an interview said Dangote Industries which has over 300 tracks running on the road, would even opt to transport more than 30 percent of its cement via rail if Zambia Railways would be competent and capable to handle the consignments.
“For us, we do not want to limit ourselves to 30 percent, we can even transport 60 percent by rail if the infrastructure and the dynamics of the current rail line can be looked at. We welcome the introduction of the SI but this SI should not be imposed,” he said.
Dr Lazarus said routes such as the Great East Road from Lusaka to Malawi via Chipata and the Mpika-Kasama-Mpulungu passage in the Northern region that do not have rail lines would be economically viable if rail infrastructure was constructed.
“Before the Statutory Instrument is imposed, it is better to look at Zambia Railways’ capacity to accommodate this Statutory Instrument,” said Dr Lazarus.
In ensuring operationalisation of the SI is smooth, Government has pledged to set up a monitoring and evaluation team that would work closely with institutions such as the Zambia Revenue Authority, Zambia Weights and Measures Agency, Zambia Chamber of Mines and other trade organisations.
Overall, the government insists that the SI comes in a bid to optimise the transport sector and promote the sustainability of rail subsector and that the implementation of this quota system would lead to the preservation of the road infrastructure.