TANZANIA SUSPENDS PORT CHIEFS OVER CARGO THEFT ALLEGATIONS

DAR ES SALAAM (Reuters) - Tanzania has suspended the head of its ports authority and six other senior port officials over allegations of cargo theft and embezzlement of public funds, the transport ministry and local media said on Friday.

The government is struggling to crack down on corruption in ministries and state institutions, with the public losing patience at the slow pace of change.

Investors have long complained of graft as one of the main reasons for the high cost of doing business in east Africa's second-biggest economy.

Tanzania's main port, in the commercial capital Dar es Salaam, which serves six landlocked countries, has often been dogged by allegations of inefficiency and corruption.

It has been losing its market share of international cargo to other ports in the region like Kenya's Mombasa and Mozambique's Beira ports, the transport ministry says.

Transport Minister Harrison Mwakyembe has suspended the director-general of the state-run Tanzania Ports Authority, Ephraim Mgawe, and his two deputies while an investigation is carried out, the ministry said in a statement on its website.

The manager of the port's aviation fuel depot, the head of the port's oil jetty and the jetty's engineer were also suspended, it said.

Local media quoted Mwakyembe as saying that up 40 containers loaded with fabrics were reported stolen, and that port officials were under-declaring fuel quantities leaving the port.

"COUNTRIES SHUNNING OUR PORT"

"Containers are being stolen like peanuts. Right now the people of Rwanda, Uganda and the Democratic Republic of Congo are no longer using Dar es Salaam and are going to Mombasa, Beira and Durban," he was quoted as saying in newspaper Mwananchi.

The suspended officials were not immediately available for comment.

In one instance a container with goods worth $182,000 owned by a trader from the Democratic Republic of the Congo (DRC) was stolen, the state-run Daily News quoted Mwakyembe as saying.

"It is alarming that containers are getting lost at the Dar es Salaam port, and as a result traders from neighbouring countries are shunning our port ... we cannot keep quiet," he said.

The port serves Malawi, Zambia, the DRC, Burundi, Rwanda and Uganda, It handled 3.275 million tonnes of cargo from neighbouring countries in 2011-12, up 106,000 tonnes from the previous year, according to data from the transport ministry.

President Jakaya Kikwete sacked six ministers in May and several senior officials have been suspended in the past few months over graft allegations, including the head of the state-run power company in July.

"Many government institutions have been underperforming and there have been graft allegations, yet no action has previously been taken," Benson Bana, head of the University of Dar es Salaam's political research think-tank, REDET, told Reuters.

"We still have a long way to go to minimize corruption, especially in the public sector. People are now talking about grand corruption, it's no longer the petty corruption of the past."