In order to improve efficiency and avoid conflict of interest, Tanzania Ports Authority should be split into two separate companies, one being the landlord and the other a cargo handling entity. Advocates of this arrangement include the chairman of TradeMark Africa, Ali Mufuruki, who said the setup was the optimal solution for better management of the country’s ports. “I am a strong believer in good corporate governance as a critical success factor in managing companies, including those owned by the state. One thing that must be avoided at all costs in a well-managed company is conflict of interest,” Mufuruki, who is also the CEO Roundtable of Tanzania chairman, argued. 

He pointed out that by being both a landlord and operator of the ports, TPA inevitably finds itself in a situation where conflict of interest is the norm rather than the exception. “I would therefore advocate the splitting of TPA into two units, one to be a commercial port operation dealing in all aspects of commercial port activities such as container handling, cargo wharfage, transportation, storage, +warehousing, etc. and the other being the landlord and port facilities regulator,” Mufuruki pointed out. He further advised that each entity should have its own board of directors and governance charters. 

Mufuruki’s suggestion was supported by the chairman of Tanzania Shipping Agents Association (TASAA) board of trustees, Emmanuel Mallya, who said the setup used to exist under the East African Harbours Corporation. “Under the East African Harbours, cargo handling and infrastructure development were handled separately,” Mallya who is also founder and Executive Chairman of EB Maritime Group of Dar es Salaam said. He further noted that the landlord role cannot be seconded to private companies while the cargo handling part can be entrusted to private companies like Tanzania International Container Terminal Services (TICTS).

Mallya gave an example of Ghana and Israel where the ports authority has shares in private companies operating cargo terminals while concentrating on infrastructure development and management. “In Ghana at the port of Tema, cargo is exclusively handled by private operators but the country’s ports authority has 30 per cent shares in all such companies,” he noted. “In Israel the government has one per cent of shares in such companies and it’s called a golden share which also entitles the ports authority to have directors on the board,” Mallya stressed. Sources at TPA said under former acting Dire

Source: IPP

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of TradeMark Africa.