Tanzania's Major Projects Set to Boost the Economy By 2025

Photo: Daily News
The East African Legislative Assembly (EALA) hails the efficiency at the Dar es Salaam port.

President John Magufuli's government has embarked on a mandate to ensure that Tanzania attains a middle-income economy by 2025.

He has therefore laid down strategies in a 2016/17 - 2020/21 Five Year Development Plan. The plan, dubbed 'Nurturing Industrialization for Economic Transformation and Human Development' pays particular attention to growth and transformation and poverty reduction.

The Exchange has compiled some of the major projects on the president's to do list. They include:

Reviving the National carrier

The government revived the defunct Air Tanzania by injecting over 1 trillion shillings ($434.79 million) aimed at revamping the carrier's fleet. Two bombardier Q400s, a Dash 8-300, a Boeing 787-8 and an Airbus A220-300 are among the aircraft purchased during the revival.

The president appointed new management of the carrier just to show how determined the government was to achieve the projected goals as laid in the 2016/17-2020/21 Five Year Plan. The Air Tanzania Company Limited (ATCL) extended routes to unexploited local destinations including Iringa, Mpanda, Tanga and Shinyanga which will most definitely boost the carrier's revenues.

The carrier is also in the final stages of reviving its revoked International Air Transport Association (IATA) membership as it plans to further exploit international markets. Plans are underway to introduce thrice a week (Tuesday, Thursday and Saturday) flights to China via Thailand by next month, targeting Guangzhou and Bangkok which are major business hubs.

This is aimed at creating ease and raising the number of locals that visit these centers for business purposes as well as exposing the country to potential tourists who will bring in foreign exchange citing tourism sector's 4.7 trillion ($2.1 billion) contribution towards Tanzania's GDP in 2017. With the absence of Fastjet (a low budget airline and rival in the market) due to unsolved issues with Tanzania Civil Aviation Authority (TCAA), Air Tanzania is expected to establish a monopoly and reap big.

Stigler's Gorge Project

The Stigler's Project involves the construction of a 2,100 Megawatts (MW) hydroelectric power dam occupying a 1,350 square kilometer stretch in the Selous Game Reserve in Morogoro.

With construction vested in Egypt's Arab Contractors Company, the company is expected to cover 80 per cent project costs amounting to Tshs.6.5 trillion ($2.9 billion) while the rest of the 20 per cent will be covered by the Tanzanian government which is Tsh.1.6 trillion ($720 million). The dam will increase Tanzania's total electricity capacity generation to 5,293 Megawatts thus supporting the industrialization process that has for long been crippled due to power shortages.

Some of the electricity will be exported to the neighboring Uganda, Rwanda and Burundi citing the World Bank's recent global achievements in sustainable energy for all that reports electricity accessibility in Uganda, Rwanda and Burundi at 26.7 per cent, 29.37 per cent and 7.5 per cent respectively which makes them lucrative for electricity export.

The dam is expected to create a flood plain downstream that can support crop production of 450,000 tonnes of paddy, 7,000 tonnes of maize, 3,000 tonnes of cotton, and some vegetables which will boost agriculture contribution to the GDP which stood at 26.4 per cent in 2017.

Infrastructure Development

Tanzania has undergone massive infrastructure development and other projects due to be established. The country began construction of a Standard Gauge Railway (SGR) to link Tanzania to Uganda and Rwanda and through these two, to Burundi and the Democratic Republic of Congo (DRC) to ease the transfer of goods from Dar es Salaam port to Kigali and subsequently to Burundi and DRC.

The railway consists of five major sections and two of these have already received funding; the 300km Dar es Salaam-Morogoro section whose construction began in April 2017 was contracted to a 50/50 consortium comprising Yapi Merkezi of Turkey and Mota-Engil of Portugal, the 426km Morogoro-Dodoma section will be funded by a Tshs.3.3 trillion ($1.46 billion) loan from Standard Chartered Bank.

The rest of the sections are Dodoma-Isaka section covering 435 kilometers, Isaka-Mwanza section covering 220 kilometers and Isaka-Rusumo section covering 371 kilometers. In September, 2018 Mfugale Flyover that cost Tsh.92 billion ($40 million) was launched and it served a purpose of saving over Tshs.400 billion ($173 million) revenue losses monthly that were caused by traffic jam in Dar es Salaam.

Plans are also underway to construct another fly over the Ubungo Junction costing Tshs.247 billion ($107 million) and is also expected to save the government from losing revenue due to traffic jam. In 2017, the government signed a contract worth Tshs.340 billion ($154 million) with China Harbor Engineering Company Limited (CHEC) to upgrade Dar es Salaam port. The major purpose of the contract was to deepen and strengthen the depth of seven berths at the port in order to allow big container ships to come in thus improving the port's competitiveness.

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