DAR ES SALAAM (Reuters) – Tanzania has received a $1 billion syndicated loan arranged by the Trade and Development Bank for infrastructure projects and is seeking an additional $500 million from the regional lender, the presidency said.
The government said in 2016 it had agreed a $7.6 billion loan from China’s Export-Import Bank (Exim) to build a railway line that will link it to neighbours, but the funds were never disbursed. No reasons were given by authorities.
“TDB has issued a $1 billion soft loan to the country and is now finalising procedures for releasing other additional loans worth $500 million for implementation of various development projects,” the presidency said in a statement late on Monday.
East Africa’s third biggest economy wants to profit from its long coastline and upgrade rickety railways and roads to serve growing economies in the wider East and Central Africa region.
Admassu Tadesse, TDB’s chief executive, said the bank was in discussion with the Tanzanian government for additional loans worth “hundreds of millions of dollars” to finance infrastructure projects, including a new railway.
“We underwrote $500 million of that $1 billion and the other $500 million was mobilised and raised through some of our partners,” said Tadesse after meeting Tanzania’s president.
“There is more on the table right now. We’ll be putting in several hundred million going forward.”
In total, Tanzania wants to spend $14.2 billion over the next five years to build a 2,561 km (1,591 mile) standard gauge railway network connecting its main Indian Ocean port of Dar es Salaam to its hinterland.
Tadesse said the high-speed electric rail network that Tanzania is building is expected to boost trade with landlocked neighbours in the region.
The TDB institution is owned by regional states and other shareholders.
Reporting by Fumbuka Ng’wanakilala; Editing by Duncan Miriri and Andrew Cawthorne