2 items with the tag Port

How to Push Efficiency Reforms in Port

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How to Push Efficiency Enhancing Reforms at the Port of Dar Es Salaam?
by Jacques Morisset, Charles Moret, and Julie Regolo

The port of Dar Es Salaam, the second largest in East Africa after Mombasa, is one of the least efficient on the planet, hindering trade and economic expansion not just for Tanzania but also for neighboring landlocked countries.

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Dar es Salaam anchorage area
Click to Download the World Bank Africa trade policy note

The cumulative delays at anchorage and dwell time can exceed 20 days, while international standards are around 3-4 days. In addition, official and non-official payments are high and prevalent. These inefficiencies are well known and mitigating them has been a priority in recent national strategies. However, the implementation of necessary policy reforms and investments has been slow and inadequate.

The lack of enthusiasm for reforms is explained by the asymmetric distribution of benefits and costs associated with the current inefficiency of the port. While gains are concentrated in the hands of a few wellconnected players, costs are diffused among multiple consumers, firms,and households across the country. Other contributing factors include the lack of awareness of costs by most consumers and firms, the unequal distribution of these costs, time inconsistency between costs and benefits associated with reforms, and the lack of coordination for decisive actions.

These basic lessons of political economy help not only to understand why the port of Dar Es Salaam has remained underperforming but also offer new directions on how to encourage the faster implementation of efficiency enhancing reforms.

Why Cargo Dwell Time Matters in Trade

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An interesting article from the World bank economic premise on a new dwell time survey analysis in SSA that reveal that collusion of interests may reinforce rent-seeking behaviors among shippers, intermediaries, and controlling agencies. Companies may use long dwell times as a strategic tool to prevent competition, similar to a predatory pricing mechanism. Incumbent traders and importers, as well as customs agencies, terminal operators, and owners of warehouses benefit from long cargo dwell times, which act as a strong barrier to entry for international traders and manufacturers.

This new analysis might have quite an impact on donors future infrastructure investments policies.

The article can be found at:
http://siteresources.worldbank.org/EXTPREMNET/Resources/EP81.pdf


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