Waters of Controversy: An Acquisition of TICTS by a Foreign Investor Leaves a lot to be Desired

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On 07th February 2024, a local English newspaper reported about a government notice issued by the Fair Competition Commission (FCC) that informed the general public of the application of the Indian firm, Adani International Port Holdings Pte Limited (AIPH) through her subsidiary company, the East Africa Gateway firm (the acquiring firm) to buy Tanzania International Container Terminal Services (TICTS).

The acquisition of TICTS, a local company vilified for poor services, raises eyebrows about why an international investor will notoriously purchase the company for unsatisfactory services. This discourse peeks at the controversy generated by this acquisition, reviews public opinion, and offers her conclusions.

Before we dabble into the issues revolving around the controversy, we must review the history behind TICTS’ performance and how it was kicked out of Dar Port operations after 22 years at the helm. TICTS was criticized for poor services, causing the government delays in loading and unloading cargo at the Dar Port, and public pressure mounted that led to the termination of her services.

TICTS is a locally affiliated ports operating company involved in stevedoring, loading and unloading container vessels, on-shore operations, stuffing and unstuffing containers, and storing and delivering containers to the consignee. TICTS is also a subsidiary of the Hong Kong-based company Hutchinson Port Holdings Holdings Ltd.

However, despite the termination of the TICTS contract, she continues to carry out her business as if nothing has happened. This was possible after another Dubai Port operator was awarded a contract to run Gates 8 – 11 of the Dar Port while TPA and another Dubai-based DP World co-jointly ran Gates 0-3.

Read Related: Lessons from Other Nations: How DP World Investments Fared Elsewhere.

The DP World solely runs gates 4 – 7. Officially, TICTS ceased her operations on 01st January 2023, but kept the ambers of her operations through hiring services to the TPA and the new operator during the transition period. Technically, TICTS never left the Dar Port despite having his Dar Port operations terminated in 2022!

Apart from retaining TICTS management and equipment, according to the English newspaper, TPA promised to maintain over 600 TICTS employees and pay them accordingly based on their previous remuneration. So, despite TICTS being shown the door for inefficiencies, TPA saw nothing wrong with adopting the whole TICTS structure while expecting new results!

Moreover, the new entrants at Gate 8 – 11 did not bring new staff or equipment, raising the possibility that the whole caboodle was designed to replace the much-maligned vocabulary while keeping the same old players running the show in different clothing of this Dubai-based company called East Africa Gateway firm that is now wholesale acquiring TICTS!

Unless TICTS was unfairly vilified for all that was wrong at the Dar Port, then a logical question ought to be who in his right mind would purchase a company that was proven beyond reasonable doubt lacking the capitalization, technical knowhow, global reach and equipment to address a myriad of headaches we have come to associate with TICTS?

Another concern is why a new Gates 8 – 11 player sees the wisdom of assimilating a company burdened with a public relations disaster. This is significant because they were relieved of her duties. After all, she failed to meet public expectations. When a new player wallows his whole reputation on a company terminated after 22 years of poor services, one wonders whether the same owners of TICTS are now in sheepskin, deluding us as “new kids on the block” while they were anything but that.

A quick perusal of the digital world, we saw what we could describe as pessimistic attitudes that Dar Port will never run as an efficient hub given the level of political interference. In the digital Jamiiforums, contributor after contributor was sceptical that our politicians would not have engineered all this acquisition to keep their straws well sunk in the get-quick schemes at the Dar Port, which come at damning damage to our economy.

Of more concern is what the acquisition firm, the East Africa Gateway firm, placed in her proposal to secure the Gates 8 – 11 operation rights. Did she touted TICTS assets as part of her arsenal to gun down that lucrative offer of operating the Gate 8 – 11? If the response is affirmative, we ought to ask ourselves whether that was not an offshoot of the political patronage system entrenched in our public institutions.

What kind of the ports regulator, such as the TPA, that had wholly discredited TICTS as incompetent, inefficient and incapable of operating her Dar port would retract her well-considered findings backed by the Parliament and the general public unless the TPA acted under political duress?

Presuming the other alternative that the East Africa Gateway firm bidding for concessionaire terms to operate Gate 08 – 11 on her own merits independent of TICTS’ assets, the niggling question becomes why the TPA allowed it to hire staff and equipment from TICTS if what we were told was the gospel truth? The TPA is on the record accusing TICTS of shoddy works, outdated equipment and technology, and even our president weighed in on the underperformance at the Dar Port, where she decried:

“…..hata mitambo yao haisomani. Ninataka mitambo isomane nami niweze kuisoma nikiwa Ikulu.”

The acquisition of TICTS by the new Dar Port operator wedges and undermines the argument that TICTS was a bugbear. Political interference is the real bottleneck in our quest to improve port performance and challenge neighbouring rivals in operating ports within the Indian Ocean.

We say so because if the equipment was a relic, why buy it and expect a different outcome? If TICTS staff were incompetent, why should they be retained in the first place? Can the same employees bring new verve without TICTS? This is what the management of the TPA said but offered no tangible evidence to support their presupposition.

In conclusion, we see the replacement of TICTS was controversial, and the employment of the services of the East Africa Gateway firm is also questionable. The latter acquisition of the former indicates the two are birds flocking the same feather. The nation is unlikely to reap benefits when a new port operator invests in another operator our government has discredited.

Our collective expectations were that the new Dar Port operators would be severe enough to chart their course away from the much-maligned TICTS, and a failure to do just that has dimmed those legitimate expectations of the Dar Port operations aspiring to meet global standards.

The author is a Development Administration specialist in Tanzania with over 30 years of practical experience, and has been penning down a number of articles in local printing and digital newspapers for some time now.

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Olsola Sindila
Olsola Sindila
26 days ago

My opinions about Dar es Salaam port is about the occurance of some sings involving individual interest or group interest AND NOT FOR NATIONAL BENEFITS AND DEVELOPMENT. THIS ACTUALLY VERY BAD TO OUR NATIONAL DEVELOPMENT.

Olsola Sindila
Olsola Sindila
26 days ago
Reply to  Olsola Sindila

Sorry correction of the word above..Not sings it should be ” signs”

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