REGULATORY hurdles and limited funding are holding back implementation of development projects, notably construction of Central Railway system and the $30 billion Liquefied Natural Gas (LNG) plant.
As the government gears up to spend
11.8tri/-, equal to almost 40 per cent of the national budget, just
3.9tri/- or 34% of the budget had been by last February (this year), an
indicator of ‘sluggish’ implementation of development projects across
the country.
Presenting a fresh assessment on the
implementation of the national budget and development plan for the
financial year 2016/17 in the National Assembly, Finance and Planning
Minister Dr Philip Mpango acknowledged the slow-down in implementation
of development budget.
He explained the ‘slow-motion’ trend
resulted from regulatory hurdles occasioned by “prolonged discussions”
with the development partners; between July and February this year, the
country had received 871.8bn/- out of the anticipated 3.1tri/- from
foreign revenue sources.
“There was also an increase in interest
for non-concessional loans at the international financial markets … this
did not affect only Tanzania but all around Africa,” he said. The
minister said the budget allocated was also released to repay an
outstanding debt incurred in the course of implementation of these
development projects.
In its budget priority last year, the
government disclosed that implementation of the Mchuchuma and Liganga
coal mining projects were still on the “negotiation stage” around
strategic areas such as tax regimes and power pricing.
On the LNG project, implementing oil
marketing firms were also still locked in negotiations around key issues
to be included in the contracts with the donor community. Turkish
contractor, Yapi Merkezi, and the Portuguese firm, Mota-engil Afrika,
have since signed deals on implementation of the first phase of the
205km SGR from Dar es Salaam to Morogoro. “The project will kick off
this year,” according to the minister.
However, he recalled that the government
managed to procure two aircraft for the state flag-carrier, Air
Tanzania, and that an advance payment of $56.89m had been made for the
other aircraft, one expected to arrive mid this year.
Dr Mpango detailed that the national
average economic growth stood at seven per cent, thanks to increased
mining activities (at 16.5 per cent); transport (15.6 per cent); ICT
(13.5 per cent and financial service at 11.3 per cent.
On revenue collection, the minister said
the government managed to collect 15.37tri/- or 79 per cent of the
targeted collections. This includes 9.3tri/- collected from tax sources
or 95 per cent of the target, 1.3tri/- or 72 per cent from non tax
sources and 3.5tri/- from domestic loan.
“Development partners donated 1.25trn/-
or 40 per cent of our projected 3.11tri/- revenue,” Mr Mpango told
lawmakers here yesterday.
Altogether, the government has released
some 16.15 tri/- to the ministries, departments and government agencies –
with a chunk amounting to 12.17tri/- to meet recurrent financing and
just 3.97 tri/- used to finance development projects between July and
February this year.
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