Tanzania allocates massive budget for ground-breaking projects

  • Air Tanzania Company Limited (ATCL) will receive Sh300 billion to complete contractual payments for new aircraft, while Marine Services Company Limited (MSCL) plans to spend Sh100 billion on the construction of cargo and passenger ships.

During the 2023–24 fiscal year, the Works and Transport Ministry of Tanzania intends to invest Sh3.418 trillion in development finance, with more than two-thirds of the funds targeted for six important projects.

The building of seven new highways, the ongoing construction of the standard gauge railway (SGR), and port upgrades are among the projects for which Sh2.3 trillion of the ministry’s development expenditures would be allocated.

A new aircraft purchase by Air Tanzania Company Limited (ATCL), the construction of railway infrastructure by Tanzania Railways Corporation (TRC), and the purchase and restoration of ships are also on the list.

The government intends to start building seven new roads the following fiscal year, according to Works and Transport Minister Makame Mbarawa, who yesterday presented his docket’s budget recommendations for 2023–2024 in Parliament.

A total of Sh3.7 trillion is anticipated to be invested in the projects, which would eventually span a distance of 2,035 kilometers. The engineering, procurement, construction, and financing (EPC+F) process will be used to build the seven highways.

“These roads will significantly unlock economic opportunities in these areas and the nation at large. Contractors have already been found and contracts will be signed before the end of June 2023,” Prof Mbarawa said.

“It will be the first time in the country’s history for road projects with a total distance of 2,035 kilometers and costing over Sh3.7 trillion to be implemented at once under this procedure,” Prof Mbarawa said. “The funds will be used to construct a railway from Uvinza to Musongati-Gitega (282km) as funds are mobilized for the Kaliua-Mpanda-Karema (321km) and Isaka-Rusumo (371km) railway projects,” he added.

According to Prof. Mbarawa, the Tanzania Ports Authority (TPA) has been given Sh820 billion to carry out its development initiatives, with Sh662.98 billion coming from local sources and Sh93.8 billion from the World Bank. He claims that TPA would utilize the money to deepen and enlarge the entry channel and turning basin to 15.5 meters, as well as to strengthen the rail infrastructure at the Dar es Salaam Port.

“The funds will also be used for deepening and strengthening berths number eight to 11 to reach 14.5 meters and continue with a feasibility study for the construction of berths number 12 to 15,” the minister told the House.

Prof. Mbarawa stated that Sh294.8 billion has been allotted for the restoration of the existing railway infrastructure, the renovation of equipment, and the planning of railway building projects with regard to the implementation of projects by TRA under the Railway Infrastructure Fund (RIF).

The government also intends to spend Sh300 billion to complete the contractual payments for three new aircraft, including a Boeing 787-8 Dreamliner and two Boeing 737-9s, improving the aviation transport system. Additionally, he stated that preliminary payments will be made for the purchase of new aircraft, such as a Boeing 737-7 and a DeHavilland Q400.

Additionally, Prof. Mbawara stated that Marine Services Company Limited (MSCL) would spend Sh100 billion to build a cargo ship with a 3,500-ton capacity, a passenger ship with a 600-person capacity, and a cargo ship with a 400-ton capacity along Lake Tanganyika.

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