TZ railways boss suspended over Tzsh 230 bn loss

kipallo kisamfu

Embattled Kipallo Kisamfu

 

Tanzania Railway Limited Executive Director Kipallo Kisamfu has been suspended indefinitely pending investigation over the importation of 150 defective wagons that reportedly resulted in a Tsh230billion loss.

The suspension announced by Transport Minister Samuel Sitta, also saw four other senior officials of the company sent home, and the minister halt the impending importation of 124 more passenger and freight wagons said to be defective, which were to be supplied by an Indian firm, Hindustan Engineering and Industries.

“I have ordered the chairman and the board to make sure it recommends among others the fate of the official by Friday (today),” said Mr Sitta.

TRL signed two contracts with the Indian company in 2013 for the purchase of 25 freight wagons worth TSh8.3billion and 274 passenger wagons worth about TSh51billion, and by press time 150 passenger wagons had been received and the remaining 124 were expected to arrive by the end of this month.

Mr Sitta, who was addressing a press conference, said should irregularities be established, the government would terminate the contract of the supplier on grounds of lack of trust and take anyone involved to court over charges of economic sabotage.

The minister said most of the claims emerged due to the fact that the wagons have been at the centre of frequent accidents. Consequently, TRL informed the supplying company, which sent engineers to fix the carriages.

“We are serious on this and the engineering department will help us in inspecting them because we want to satisfy ourselves that the wagons are durable,” he said. He said TRL did not incur a loss because it did not make full payment for the consignment as the contract allows the purchaser to withhold part of the payment until the wagons are tested within the warranty period.

He, however, noted the TRL had been operating profitably up to the end of last year due to the increase in freight wagons.

“Last January we got US$38million profit up to July whereby from October to December the profit bounced to US$140million,” said the minister.

The new developments come weeks after Heads of State from the central corridor met in Dar es Salaam to deliberate on ways to improve the transport and logistics industry.