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Zanzibar ship owners’ worries as AGL takes over Malindi port operations

Classified documents via reveal 25% of the new port ownership is privately held by President Hussein Mwinyi.

Unguja. Zanzibar ship owners have complained about changes in procedures and costs after the government handed over the management of Malindi Port operations to a French company.

On Monday, the Zanzibar Ports Corporation handed over the management of the port to Africa Global Logistics (AGL), as it anticipates a rise in efficiency and revenues from the facility.

A few days after the takeover, ship owners complained of changed procedures in docking and payment, a move that they say will increase the cost of imports.

Dhow operators complained that the fees have almost doubled since the new port operator started working.

However, government officials defended the new fees, saying they were in place since 2018 but were not implemented.

One of the ship owners, Mr Mansour Saidi, said at least three ships were prevented from docking at the port until they paid the new fees.

“We used to dock first and pay when the cargo was being offloaded. This has now changed, and we are required to pay first,” he said, adding that the new system is posing another challenge for them.

He said the move would cause delays in the offloading of containers and probably affect the prices in the market.

“The government needs to handle this issue carefully,” said another owner, Mr Hamis Hamad, alias Kisu.

Zanzibar Minister for Finance and Planning, Dr Saada Mkuya Salum, warned traders against using the changes at the port operations to raise commodity prices.

“These are changes that we all need to accept. We can’t transform the economy by operating under the same old procedures,” she said, adding that the government will not accept being held back.

The Minister for Works, Communication and Transport, Dr Khalid Salum Mohamed, said the challenges in the port are being addressed, but the operational changes will continue.

“Changes are inevitable at the port. What’s needed is just a collective understanding of the operational changes,” he said.

The French firm will manage the operations of the port for five years and is also expected to improve the container handling capacity and reduce the time that ships spend at the port, which serves as the main entry point for Zanzibar’s international trade.

According to the contract signed in May 2023 by the two parties, Zanzibar will get 30 percent of revenues from port operations, while the French firm will take 70 percent.

The handling of port operations in Zanzibar comes at a time when Tanzania and the Emirate of Dubai have signed an Intergovernmental Agreement (IGA) on the operations of ports on the mainland.

However, the IGA between Tanzania and Dubai on economic and social partnership for the development and improvement of sea and lake ports in Tanzania has been the subject of intense debate in the country during the past few months.

The IGA sets the stage for further negotiations on the Host Government Agreement (HGA) and lease/concession agreement before the commencement of a new chapter of cooperation between the TPA and Dubai Port (DP) World.