MAJOR investment at the port of Dar es Salaam has begun to produce positive outcomes, with the government saving $600m (1.5trn/-) by the time one year is completed.

Martin Jacob, the chief executive officer for DP World (T) and the Middle East unveiled this achievement when addressing journalists in Dar es Salaam yesterday.

He outlined recent developments at the port since the commencement of the contract with the Dubai-based multinational logistics firm, explaining improvements made in the four months.

This has led to a reduction in freight transportation costs, stimulated port activity and resulting implications for economic growth, created jobs and positioned Tanzania as a key economic gateway in East Africa.

This success reinforces Tanzania’s role as a business hub in East and Central Africa, underscoring the commitment by President Samia Suluhu Hassan to manage the nation’s resources effectively.

Key achievements include reduced ship waiting times, quicker cargo unloading and significant improvements in cycle times and costs, he stated, noting that the strategic partnership with DP World has allowed the Mediterranean Shipping Company (MSC) to eliminate additional cost of $1,000 per container.

This comes down to $600m annually that is already being counted as savings, he said, pointing at crane operations having been enhanced, with output increasing rapidly from May to July 2024, as the port successfully handled larger ships.

The port of Dar es Salaam is now comparable to Mombasa in terms of cargo handling tonnage, reinforcing Tanzania's position as a leading seaport in the region, he stated, elaborating that these improvements translate into lower costs for traders and faster cargo removal.

This promotes Tanzania’s economic growth under the president’s visionary leadership, he said, highlighting that the port investment plan includes spending upwards of 387.8bn/- ($3bn) on infrastructure.

The purpose is to develop additional transport corridors serving Mombasa and Dar es Salaam ports to capitalise on business potential on both sides of the border, as DP World is focused on building more facilities to reduce non-tariff barriers and help traders lower their transaction costs.

“This is the first phase of a multiple-phase investment plan. DP World will initially invest more than $250m (32.32bn/-) to upgrade the port, with the investment potentially rising to $1bn (129.28bn/-) during the concession period, alongside hinterland logistics projects,” he asserted.

“There is a need to apply our expertise where it is needed. Since we arrived in Tanzania, we have seen significant progress such as reducing the number of ships waiting from an average of 40 ships in April to about 10 ships in July at any given time,” the port administrator intoned.

Plasduce Mbossa, the Tanzania Ports Authority (TPA) director general said that TPA has seen significant savings due to the reduction in additional charges, tied to a decrease in the time it takes for ships to be serviced, from 30 days to 10 days.

He said that container ships now take three to four days to unload cargo, which has prompted shipping companies to lower additional charges set at $1,000 per container.

TPA handles upwards of 1.2m containers annually thus with the reduction in charges, other shipping companies are expected to follow suit and reduce their fees as well, he said.

Significant changes, including fee reductions, imply that more shipping lines vessels will now anchor at the port of Dar es Salaam, scaling down preferred use of the port of Mombasa, he said.

"If we handle 1.2m containers per year that’s equivalent to 600,000 containers per half-year, implying that we are saving $600m,’ he specified. 

“This money was paid by Tanzanians so they will benefit from the reduced costs. This is a success for the leadership of President Samia Suluhu Hassan," he added.