Southern African country seeks private transport support

The Malawi government is seeking private-sector companies to operate water, air and railway transport services in the Southern African country.

In the water transport sector, the government is seeking a concessionaire to operate the State-owned Malawi Lake Services (MLS), the biggest firm that manages water transport services on Lake Malawi.

President Bingu wa Mutharika's government wants a new private partner in MLS because it has severed a 20-year-old concession with Glens Waterways, which has only managed MLS for six years, owing to "unsatisfactory performance".

"Over the six-year period, a number of challenges were experienced, both on the part of the government of Malawi and on the part of the operator. The government of Malawi and Glens Waterways have reached a mutual agreement to hand over the concession.

"We are now working to identify a replacement for the concessionaire. The government's marine department is taking charge of MLS while we wait for the identification of the new operator," says Malawi Privatisation Commission information, education and communication officer Chimwemwe Matonga.
The Malawi government is seeking investors into the air transport sector, with Finance Minister Goodall Gondwe saying that government has intensified its efforts to identify a strategic partner for the national flag carrier, Air Malawi.

"We feel that the airline could be re-established [in such a way that] government retains a 51% shareholding and a strategic investor holds the remaining 49%. Government will, thus, have a majority on the board of the airline. In pursuing this deal, we are looking at what other countries, such as Nigeria, Kenya, Zambia and Ghana, have done," says Gondwe.

Gondwe says the Malawi government feels introducing a strategic partner in Air Malawi will help turn-around the fortunes of the airline, which is failing to deliver reliable services and has often failed to procure basic operational materials such as fuel without government's support.

The Malawi government previously tried to privatise Air Malawi and invited local and foreign companies to bidders to acquire a controlling shareholding in the firm.

The privatisation process, however, flopped because prospective bidders found the airline unviable, which forced the government to continue investing in the airline while pursuing the sale process in passive mode.

"We now feel it is time to re-establish the airline as one that provides the public with an efficient and reliable service throughout the country and one that is not a burden on public finances," says Gondwe.

In the railway sector, Gondwe says government is seeking partners in the operation and rehabilitation of the country's rail network.

He says government is engaged in negotiations with the World Bank and the European Union (EU) to finance the rehabilitation of some stretches of the rail network.

Gondwe declines to reveal the actual cost of the rehabilitation excercise, which is estimated to cost several millions of dollars.

"What I can say from our discussions with the World Bank and the EU is that the prospects that we will be funded are so good that the work to bring rail transport in Malawi to normal operational standards can start next year," says Gondwe.

The Malawi government is also carrying out a major road rehabilitation programme.

Notable projects that are under way include the construction of the Thyolo–Makwasa–Muona–Makhanga road, at an estimated cost of $46,5-million, and the $40-million rehabilitation of the Bangula–Nsanje–Marka, road in the southern region.

The Malawi government is also carrying out the $59-million construction of the Zomba-Jali-Phalombe road in the southern region and the construction of the Karonga-Chitipa road in the northern region at a cost of $45-million.

The rehabilitation and upgrading of the Masauko Chipembere highway, in Blantyre, has also started, with funding from the Japanese government to the tune of $15-million.

The major road projects that Malawi's Ministry of Transport and Public Works has lined up this year and are expected to cost millions of dollars include the construction of the Mzimba–Kafukule–Njakwa and the Jenda–Edingeni–Ewuthini–Rumphi roads in the northern region, and the Lumbazi–Dowa–Chezi and Lilongwe Old Airport–Kasiya–Santhe roads, in the central region.