Tanzania Seeking $525 Million for Road, Rail Infrastructure, Minister Says
Tanzania plans to borrow $525 million in the 2011-2012 financial year to invest in improving its road and rail networks, Finance MinisterMustafa Mkulo said.
That will be in addition to the $250 million loan agreed with Stanbic Bank Tanzania, the local unit of South Africa’s Standard Bank Group Ltd., he told reporters today in the commercial capital, Dar es Salaam. Tanzania will seek raise at least $450 million in the 2012-13 period, he said.
“This shows the level of confidence our investors have in our economy,” Mkulo said.
The government of East Africa’s second-biggest economy plans to build new roads and rail lines to mainly areas with “highest economic potential,” such as agriculture, mining and tourism, according to its five-year development plan.
Most of Tanzania’s rail network was built before 1924, during the German colonial era, to transport agricultural products including sisal and coffee to the coast for export to Europe.
The loan arranged by Stanbic Bank Tanzania from a group of lenders is for seven years, with a two-year grace period and after that a 5.2 percent annual interest rate, Mkulo said.
Tanzania vies with Mali to be Africa’s third-largest producer of gold, and hosts the world’s only known deposit of tanzanite on the foot of Mt. Kilimanjaro. It also ranks among Africa’s top five producers of cashew nuts, cotton, tea, coffee and sisal.
To contact the reporter on this story: David Malingha Doya in Johannesburg at dmalingha@bloomberg.net.
To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net.
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