All is set for the government to kick-start deliberations relating to the development of the multi-billion Dollar Bagamoyo Port Project, says Minister for Investment Mr. Geoffrey Mwambe. The Minister also maintained that the discussion will be guided by economic and financial modeling principles.
Mr. Mwambe made the revelation in Dar es Salaam, yesterday while briefing journalists on the project's state of affairs, citing parties to be involved including China Merchants Holdings (International) Co. Ltd (CMHI) and Oman Investment Fund (OIF) formerly known as State General Reserve Fund (SGRF).
"Necessary preparations have been finalized on the government side, which includes securing all relevant documentations as well as informing our counterparts from Oman and China," said Mr. Mwambe. He pointed out that the discussion will involve the development of the 3,000 hectares land out of 9,800 hectares, comprising the construction of a sea port, Logistics Park (800 hectares) and portside industrial city (2,200 hectares).
According to him, it is estimated that the execution of sea port and logistics park is estimated to cost 3,1 billion US Dollars, portside industrial zone (2,1 billion US Dollars) and 1.4 billion US Dollars for other enabling infrastructure. The Minister called upon individuals who owned land and eyes to construct industries within the 9,800 hectare to communicate with the government for such areas to be included in the master plan for developing the area.
Minister Mwambe invited other investors intending to invest in the remaining areas including the establishment of industrial parks, SMEs sheds, parks for youth products, hotels and apartments to meet with the government to express their interests. Elaborating further, he said the project under question will be implemented using engineering, procurement, and construction (EPC) models and through joint venture companies owned by the three parties, noting that it was not entirely true that the government will not benefit from the project.
"From day one the government will benefit from loyalties, concession fees or land rents among many other aspects," he noted. Expounding further, the minister noted that the design of the project has been developed by the two companies and the same applies to the execution. Thus, the two companies from China and Oman will finance the project as well as employ their technology and management; whereas, the government through the Tanzania Ports Authority (TPA) will inject equity by way of compensation.
Considering the magnitude and importance of the project, he noted that the government has decided to relocate the fish port located at Mbegani to Kilwa in Lindi region, on grounds that food products and products of other kinds do not come into contact, thereby affecting the country's international market.
Likewise, the Mbegani Fisheries Institute will also be relocated to another area to give room for the execution of the project. Elaborating on the rumors of the Chinese firm demanding that no other port from Mtwara to Tanga should be developed, he said the rumors were unfounded, noting that due to competition, the investor requested that similar port should not be developed from Dar es Salaam to Pangani area due to the large investment of 10 billion US Dollars.
Mr. Mwambe indicated that the Bagamoyo Port is expected to complement the operations of the Dar es Salaam Port taking into account that the investment is anticipated to accommodate what is known as fourth generation ships. Whereas, the special export processing zone is expected to accommodate other economic activities including industrial development, the port will facilitate the needs for the industries.
Among other benefits which will be secured from the project implementation are substantial economic growth through an increased tax base, technology and skills transfer; and foreign direct investments.