Dar es Salaam — Seven government institutions and private companies expect to receive $1.3 billion (about Sh2.8 trillion on the prevailing exchange rate) in loan from a US-based equipment company.
Nationwide Equipment - which specializes in the sale of new and reconditioned earthmoving, mining road building, and marine equipment - will make avail the institutions with the equipment to help them in implementing various projects in areas of infrastructure development, mortgaging and city development plans.
Nationwide Equipment President, Mr Ed Kostenki said in Dar es Salaam at the weekend that the company will work with Tanzania's commercial banks in remitting funds to the clients.
Company and government entities are free to apply funds ranging from $1 million to $1 billion.
"We are currently finalizing negotiations with seven government institutions, banks and other clients," he said, declining to name the institutions in the project.
He said his company is experienced in provision of capital goods for huge projects, expressing readiness to take part in the revamping of the central railway to the Standard Gauge Railway (SGR) status.
He said the company's interest rates ranges between six and eight per cent.
"Interest rates are very high in Tanzania. Charging someone 12, 13, 14 or 15 per cent for a mortgage loan adds to life hardship" he said.
He called upon the government and other stakeholders to ensure that interest rates are brought down. This, he said, would be achieved through improving the business environment for individuals to open banks and allow financial services to provide lending at lower costs.
In 2008, Nationwide Equipment Services started funds financing in African countries, taking advantage of global economic crisis. Currently, it is operating in Zambia, Rwanda, Chad, Ghana, Nigeria and Cameroon.