Fuel crisis puts rail-water transport into focus

Motorists queue at Shell fuel station in Mengo, Kampala, on January 19. Most of the fuel in the country is transported by road. Photos / File

What you need to know:

  • It is now more than a month since fuel prices shot up. The crisis first occasioned by a logjam of fuel tankers at the Malaba and Busia borders after drivers went on strike over mandatory Covid-19 testing, leading to a countrywide supply glitch and eventually market distortion— hoarding by the bulk suppliers.
  • Until the mid-1990s precious cargo, including petroleum products, were hauled via rail-water links that remained operational even during the political strife of the 1970s and 1980s, then the liberalisation dogma pushed by Bretton Wood Institutions upended everything as Frederic Musisi & Alex Ashaba write.

Owing to Uganda’s landlocked status, the British colonial government prudently choreographed a multi-modal transport system of road, rail, water, and air, one that initially served their interests—to ease access to different pockets of the country for administration, and hauling resources to serve the roaring turbines during the industrial revolution. 

This blueprint was replicated across several countries landlocked or not.

In British East Africa (Kenya, Uganda and Tanzania) the Meter Gauge Railway (MGR) was conceived as the gateway to the sea, from Mombasa at the Indian Ocean snaking through Kisumu port to Port Florence on Lake Victoria, which at the time was part of Uganda. Then they developed Port Bell in Kampala, the Jinja Pier in Uganda, and Bukoba and Mwanza ports in Tanzania. In Uganda, the railway stretched to all corners of the country; Kampala, Kasese in western Uganda and Pakwach in West Nile.

According to accounts, trains would transport cargo and passengers to Kisumu port, which were picked up by steam engine ferries to Jinja or Port Bell, then onto the train to Kampala. From Jinja, a train link connected to Namasagali at Lake Kyoga, then onto ferries, before being put on a train link to Butiaba on Lake Albert.

The unprecedented rise in water levels in 1962 after three years of heavy rains scuttled inland water transport at Butiaba, Majanji (in Busia) and Bukakata (Masaka) ports, but not the transport link between Jinja and Kisumu/Mwanza.

Fifty nine years after independence the once vibrant rail-water transport is no longer visible but a relic of the past buried in colonial history footnotes.

“In the 1980s Port Bell was revived and quickly picked up, and railway line restored. Before then, most of the operations—cargo—was hauled through Jinja,” recalled Charles Kateeba, the former Uganda Railways Corporation (URC) managing director.

From the 1980s Port Bell served as the country’s main port handling passengers and goods—complimented by the Jinja pier. Today, the two ports are junkyards with heaps of debris and relics acting as the lasting vestiges of their commercial success.

Port Bell’s land has been encroached and grabbed, including by the political elite and their cronies. Only three acres are left today. The World Bank/European Union-funded plan to refurbish Port Bell and the connecting 9km railway link to the train central station in Kampala failed to materialise over among others “absence” of land to expand the port and lack of goodwill by government.

“Some of the people settled near or on the port land are too powerful to touch, so the scared government officials are taking us in circles with plan. They feared to press the wrong button,” a World Bank official once told this newspaper.

As such government assumed a separate plan to construct a new port in Bukasa in Wakiso Port, which will be synced with the proposed Standard Gauge Railway (SGR) from Kenya and the southern corridor that follows Tanzania’s central railway which runs from Dar es Salaam port at the Indian Ocean through Dodoma to Tabora and finally to Mwanza port on Lake Victoria.

Self-imposed problems

Worldwide, it has been proven empirically that water transport is the cheapest means of transport, closely followed by railway, road, and air transport. Water transport is also deemed safer than all the other three modes of transport.

Yet in landlocked Uganda, the current National Resistance Movement (NRM) government for the last 36 years, relegated this mode of transport to the back-burners. President Museveni and policy wonks in the ministries of Works and Transport, and Finance, have on numerous occasions spoken about reviving the decrepit transport system—particularly to reduce transport costs to ease doing business in Uganda—but there’s little to show.

Over the last 15 years, the government has prioritised tarmacking of roads with the budget of Uganda National Roads Authority (Unra) growing four-fold. Across the country there are visible investments in the roads subsector, while at the same time corruption has been rife through wheeler-dealer contracts.

The ensuing debate over the rise in fuel prices—Shs5,000 per litre of petrol and more than Shs4,000 for diesel—that started early last month with a logjam of fuel tankers at the Kenya border points in Malaba and Busia as truck drivers protested double testing for Covid-19 by authorities on both sides, has during the last weeks renewed debate over Uganda’s fragile position in terms of preparing for the worst-case scenarios.

The Health ministry eventually suspended Covid-19 testing for the truck drivers and customs officials expeditiously cleared all fuel cargo imports into the country. In a statement to Parliament last week on Thursday, the Ministry of Energy accused bulk suppliers of hoarding fuel, which has kept prices unreasonably high.

The post-election violence in Kenya in 2007 drove the country into a similar crisis for fuel and other essential services after Uganda-bound cargo trucks were targeted—vandalised and burnt— especially in the Raila Odinga strongholds in the eastern part. Some sections of the meter gauge railway too were uprooted, over perceived meddling the Kenyan polls by the government in Kampala.

Kenya goes to the polls and this uncertainty has jolted the Energy ministry into drawing up a report it intends to table in Cabinet on how to avert such a crisis.

“The effect could have been cushioned if we had a vibrant rail-water transport system,” Mr Kateeba said, who retired in 2019, told Daily Monitor in an interview last Thursday.  “If you are bringing in fuel by barges or train then you would have fewer fuel trucks.”

Uganda’s daily consumption for petroleum products averages at 6.5million litres. Energy ministry officials intimated that this fuel is hauled in almost daily which explains the high frequency of truck tankers on the road.

One of the reasons of regulated supply is premised on national security; the two major bulk fuel suppliers Vivo and TotalEnergies, depots are situated within the central business district so they are not fully stocked, while the small suppliers have to keep the trucks on the road to haul in their supplies.

No lesson learnt

The high frequency of loaded fuel tankers on the road is also a major security risk to other motorists and road users in case of an accidental explosion. There have been a number of accidents involving fuel tankers which have left a heavy human toll.

“One ship carries 22 tank wagons equivalent to nearly 50 trucks on the road. You only need one pilot a few other support crew, and you are not incurring costs of wear and tear for the road which government offsets by increasing a levy on fuel to maintain the roads,” Mr Kateba noted.

During the first lockdown in 2020, it would take days to clear a single truck at the Malaba-Busia borders leading to a build-up of cargo trucks. Early last month as the truck drivers protested the Covid-19 rules, pictures showed a traffic snarl-up covering a 10km stretch.

Mr Apollo Kashanku, the rail-water principal transport economist in the Ministry of Works, told this newspaper that government has plans to develop a multi-modal transport system, citing the refurbishment of the meter gauge railway as the fall-back position as inordinate delay towards funding the proposed Standard Gauge Railway has placed the project in limbo.

Plans to develop Bukasa port, which lies on the shores of Lake Victoria are underway as well as headhunting investors to refurbish Port Bell as a tourist haven.

“Port Bell is in place but the focus is on Bukasa,” he said. “We have 400 hectares for the port. We have so far paid up to 90 percent of the project affected persons by next year and think we will start construction next year.”

The German and Belgian governments are bankrolling the Bukasa port project expected to cost €350m (about Shs1.4 trillion), which will be undertaken in phases. In 2015 government signed a general framework agreement for development of the port with a German engineering firm, GAUFF GmbH &  Co. Engineering KG.

Travel time between Entebbe and Port Bell on a speedboat is 15 minutes. But there is no functional transport service between.  Even with the newly Shs1.7 trillion Kampala-Entebbe Expressway, which was conceived to alleviate the nightmarish traffic jam off the old Entebbe road, anyone travelling between Kampala and Port Bell would spend averagely an hour or slightly less.

Travel time for water cargo vessels between Port Bell and Kisumu Port is 16 hours. Between Port Bell, and Mwanza Port travel time is 18 hours but the transport water services across the routes are sketchy.

 “It is true water transport is comparatively cheaper; from Port Bell to Mwanza, it costs two cents per ton km (price per kilometre), rail is about five to 10 cents per tonne km, while road is 21 cents per tonne km,” Mr Kashanku said. “The major difference is in efficiency—right now our water-rail system is not—and a business doesn’t look at the cost but efficiency—how fast his cargo can get to wherever.”

By the time, the NRM government came to power in 1986 after the Luweero bush-war, the railway, airlines and water transport were bruised and battered but remained resilient.

Once Marxist leaning in 1987, Museveni embraced the neo-liberal capitalist agenda as aid from the Bretton Woods lifted the economy out of gloom.

But the process of privatisation was not squeaky clean. Regime cronies engaged in corruption and asset stripping as the once vibrant rail-water transport gradually collapsed.

Uganda Railways Corporation which oversaw rail-water transport became the poster-child of corruption.

According to Mr Kateeba, rail-water transport remained operational until around 1995 when the forces of liberalization propelled by the World Bank and International Monetary Fund, set in motion.

A train wagon delivers Shell fuel to Kampala. 

Little efforts


The Works and Transport Sector Development Plan (WTSDP) 2015/2016 – 2019/2020, an offshoot of the government’s policy blue print, the National Development Plan, now in the third edition, details government’s lofty dreams of developing a sustainable multi-modal transport infrastructure and services— road, rail, air and inland water transport modes— “for economic transformation.”

Currently, road transport is the dominant mode of transport with 90 percent of all in-bound cargo freight and passengers move by road.

The dominance of transport gave birth to a powerful cartel that invested heavily in truck business plying the Mombasa-Kampala route and is fiercely against any attempts to revive the rail-way transport.

This is worsened by the market-demand forces and absence of a deliberate government efforts to prioritise the railway.

In 2018, government kicked out the meter gauge concessionaire—Rift Valley Railway (RVR) for “failing to hit targets” such as growing freight volumes despite the latter routinely complaining about absence of conducive environment including a policy to compel especially large cargo haulers to use rail.

Mr Apollo Kashanku, the rail-water principal transport economist in the Ministry of Works, acknowledged existence of the cartel but deflected that, “if you see the numbers; we just need to make the railway efficient and the cargo will come. Besides the cartel I also know there is the thrill of some people insistent on using the road, wanting to drive say to Mombasa for whatever reasons.”

About the deliberate lack of effort to push cargo haulers to use rail, he said: “What you are saying has been thought about but the business people—those that have invested in transport business—ask why they are being forced to use the railway. So, our plan is to make the rail efficient and then can attract everyone else.”

During its hey days, Mr Charles Kateeba, the former Uganda Railways Corporation (URC) managing director, revealed: “The biggest business URC enjoyed wasn’t from Kisumu but Dar-es Salaam. We were the only one hauling in petroleum products until the early 2000s using rail wagons from Mwanza to Port Bell or Jinja. We used to get some fuel via Kisumu hauled by tank wagons by locomotives all the way to Kampala.”

URC underwent years of mismanagement as all other state parastatals many of which were sold for a pittance. In 2005, regime cronies fronted RVR which was awarded the concession for meter gauge railway in Uganda, and in Kenya.

“The rule of thumb is that water transport is the cheapest mode of transit. In comparison, rail is about one and a half cheaper than road. Water transport is 5 times cheaper,” Mr Kateeba added.  “When you have water transport the main infrastructure are the ports; there’s no repair, no wear and tear of the routes, no maintenance except for the vessels, as compared to roads, or even rail tracks which wear and tear.”

When RVR was awarded the concession, Mr Kashanku revealed that it was not interested in the segment on water transport which paved way for the collapse of Port Bell and Jinja pier.

“RVR got the concession but like elsewhere, where transport was privatised, the concession failed because such transport is a public good while an investor is looking at profit,” Mr Kashanku said. “In the Ugandan scenario, RVR was looking at profit from rail while water transport would be eating into this share.”