Tanzania needs an estimated Tsh84bn (US$84mn) per year to finance maintenance of the country road network, assuming all those targeted are in maintainable condition.
Tanzania’s road network is approximately 8,500km long with 4,430km categorised as paved and 80,570km unpaved.
According to the annual report of the Roads Fund Board, an increase of 10% to cater for development activities will push the total requirement to Tsh94bn (US$94mn) per annum.
The report further states that, “on the other hand, the estimated total collection of fuel levy for financial year 2000/2001 was only Tsh45.8bn (US$45.8mn) which corresponds to only 42% of estimated actual requirement of roads in maintainable condition.”
Inadequacy of maintenance funds means losses to the economy as a whole. The World Bank estimates that a reduction of US$1 in the road maintenance budget causes an increase of US$2 or US$3 in vehicle operating costs.
According to the study, 30% of the 10,300km trunk roads are in good condition, with 39.2% being in fair condition and 30.8% in poor condition.
It further says that only 30% of regional roads are in good condition, with 73.2% in fair condition and 0.2% in poor condition. Regional roads cover 24,700km, with only 100km paved and the rest unpaved.
This category, which includes district, feeder urban roads, has 72.5% of the 50,000km in poor condition, 19.5% in fair condition and only 8% of the roads in good condition.
According to the study, the poor condition of the roads increases vehicle operating costs, mainly fuel and maintenance, because of excessive vehicle depreciation causing loss of travel time due to lower speeds.
“This will in turn have a spill-over effect on the whole economy because high operating costs are being passed on to producers and consumers in the form of high freight rates and fares, which in turn make Tanzanian agricultural and industrial goods expensive and uncompetitive in regional and international markets even and against imports,” the report says.
This also results in a decline in government revenue. Locally, high freight rates and fares hurt consumers because food prices and transport fares increase, causing inflation, eating into incomes that are already very low.
In total, the losses to the economy through the road sector are estimated at Tsh603bn (US$603mn), or about 9% of the country’s gross domestic product (GDP). “This figure is greater than our export earnings, which stand at Tsh536bn (US$536mn), equivalent to 9% of the GDP.
To preserve the road network and secure more stable financing for road maintenance and management Tanzania enacted the Roads Tolls (Amendment) Act No2 of 1998, which established the current Road Fund and the Road Fund Board.