Improving Transnational Transport Corridors
In the OIC Member Countries: Concepts and Cases
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Railways Tapering Tariffs
One of the constraints to international railways is the tapering tariff structure. Railway tariffs are nearly
always tapered, the further the movement the lower the unit rate. This is applied with the management
jurisdiction of the railway - which is national. Each time a consignment crosses into a new jurisdiction the
taper starts over again. Thus, the consignor is denied the benefit of ultra-low tariff rates for very long
movements involving 2 or more countries. If railways worked together and offered a through rate, then prices
will fall and the rail market share will surely increase.
Almost all railways operate at much lower traffic levels than they were designed for. Domestic
freight demand has all but disappeared. They are in a critical state. It is noted that the use of
railways in Transport corridors is much less than it should be. To regain a market share
SADC has proposed that common technical, operating and safety standards need to be
established and enforced so that railways can operate across borders under the
oversight of a Regional Regulator.
Formulation of a multilateral regional business agreement between railways needs to be
negotiated to facilitate migration from the existing constraints of bilateral agreements. The
rail corridors have much to gain from a SADC open access railway network.
Even though SADC railways generally operate well below their original design capacity, they
cannot increase their volumes because of poor track condition, lack of locomotive and wagon
availability and low operating capital.
The SADC Railway Sub Sector Plan proposes many projects to revitalize the existing railways,
construction of missing links (especially those serving the mining sector) But the main
challenge for railways is reform, to restructure and permit open access to private operators.
SADC does not go far enough, but instead proposes that national railways should invest in new
locomotives and rolling stock which is not a good idea given the high commercial risks.
Ports
According to the SADC diagnostics, most regional ports are currently operating near or over
capacity. Some of the factors causing delays are cited as being due high costs, poor port/road
and port/rail interfaces, poor handling capabilities and equipment, congested access routes,
inefficient layouts, insufficient use of operating software, insufficient berths and drafts and
slow clearances by regulatory agencies and transport operators.
SADC notes that despite the current expansion programs at most of the Region’s ports, there is
apparently an urgent need to increase port capacity and landside access beyond the projects
already in the pipeline, particularly for existing deep-water ports, such as Nacala and Walvis
Bay. It is noted that there was nothing mentioned about landlocked countries buying an
interest in Ports, which is possible.