Tanzania wins funds to boost transparency as infrastructure projects gather pace

The bank said the “first-of-a-kind” ‘open government and public financial management development policy operation (OGPFM) in Tanzania, financed with credit from the bank’s International Development Association (IDA), aims to improve public investment management and procurement.

The task team leader for the OGPFM project Chiara Bronchi said: “The programme proposes an innovative approach that will balance traditional public finance management reforms with a new focus on open data and transparency.”

Akshai Fofaria of Pinsent Masons, the law firm behind Out-Law.com said: “IDA funding is highly coveted and one of the largest sources of financial assistance for Africa’s poorest countries. This substantial investment in Tanzania will demonstrate to other African nations, especially in East Africa, the international support that is available when countries are willing to take meaningful steps towards accountability and transparency in government.”

OGPFM is designed to support the goals of the ‘Tanzania Development Vision 2025’, a policy blueprint that sets out actions Tanzania must take to become a middle-income country.

The blueprint commits Tanzania to tackling “the excessive use of administrative controls and regulations” and giving “the highest priority” to investment in infrastructure projects, which Tanzania’s government said should involve “increasing promotion of investment” by the state, the private sector and others.

National institutional and organisational structures “have not been reviewed to cope with the demands of the ongoing reforms”, the blueprint said. “As a result, these structures have not been supportive of evolving social relations which promote the participation of all partners in development. They have equally failed to effectively mobilise domestic resources and capabilities to meet the emerging challenges of market-oriented and private sector-led development.”

In October 2014, Tanzania announced the signing of investment deals with China worth more than $1.7 billion, including plans to build a ‘satellite city’ to ease congestion in Dar es Salaam and $85m in grants and zero-interest loans from China for unspecified projects. According to figures from the China Business Network, China’s total direct investment in Tanzania soared from $700m in 2011 to $2.1bn in 2012, with investments focused on railways, ports, buildings, road construction, gas pipelines and wind power farms.

Last December, the World Bank said it would provide $1.2bn of funding to support infrastructure development and “improve the competitiveness” of countries throughout the East African Community, which is the regional intergovernmental organisation of Burundi, Kenya, Rwanda, Tanzania and Uganda.

Earlier this year, Tanzania’s government announced plans to use commercial loans to finance a $14.2bn rail network building programme over the next five years. Work planned includes building a 2,561 kilometre standard gauge railway, which will link the port at Tanzania’s commercial capital of Dar es Salaam to Rwanda and Burundi at a cost of $7.6bn. Two additional lines, costing an estimated $6.6bn, will connect Dar es Salaam to mining areas in the south and north of the country.