PRESIDENT Magufuli has said the government has the money to finance all mega transport and energy infrastructure projects, thanks to a tax collection drive he launched that has boosted treasury coffers.
“There are funds for construction of the standard gauge railway until its completion. There are funds for Stigler Gorge hydroelectricity project,” said President Magufuli at the inauguration ceremony of the tobacco processing factory, a day after he laid a foundation stone for the second phase of the construction of standard gauge railway in Dodoma on Wednesday.
The government is constructing a 2561km standard- gauge railway which will eventually link the Indian Ocean port of Dar es Salaam with Mwanza on Lake Victoria and Kigoma on Lake Tanganyika, as well as neighbouring Rwanda and Burundi.
Construction of the 205km first phase from Dar es Salaam to Morogoro Region is underway and is expected to be completed October 2019. Construction work to cost 2.7tri/- (1.215 billion US dollars) was awarded to a consortium of a Turkish firm Yapi Merkez and the Portuguese Mota-Engil, SA.
The Turkish firm will also construct a 422-km stretch of the railway from Morogoro to Dodoma at the cost ( of over 4tri/- (1.9 billion US dollars). The government plans to construct Stiegler’s Gorge hydroelectric project along Rufiji River that is expected to generate 2,100 megawatts (MW) of electricity to fire the industrialization drive.
The mega energy project is deemed vital in government bid to diversify energy mix and end chronic electricity shortages. The project will more than double the country’s power generation capacity.
Tanzania aims to boost power generation capacity to 10,000 MW on the next decade from about 1,500 MW currently by using hydropower and some of its vast natural gas and coal reserves.
Tanzania and Uganda have launched construction of 1,445 kilometres heated oil pipeline from Hoima oilfields in Uganda to Tanga port. It will be the longest electrically heated crude oil pipeline in the world and will pump Uganda’s crude oil to the global markets.
It will cost the two nations 3.55 billion US dollars. President Magufuli said the government has foreign exchange reserves of about 6tri/- which is enough to cover import goods and services for five months.
The microeconomic convergence criteria agreed in the East African Community (EAC) Monetary Union is the foreign exchange reserve enough to cover 4.5 months of imports. He said the country’s foreign debt reached 32.5 per cent of the GDP meaning the country could borrow more from international lenders.
Tanzania’s credit worthiness of the country among international lenders had significantly improved to the extent of building trust among lenders. “We have the opportunity to borrow more but we do not strive to do that. Nowadays they (international lenders) come to us instead of we looking for them,” he said
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