Madrid — SPAIN, Madrid : SPAIN, through its Export Credit +Agency (ECA), has expressed an interest in financing the Standard Gauge Railway (SGR) construction project by providing loans, loan guarantees and insurance to the country's companies that will build the railway from Makutupora to Mwanza and from Tabora - Morogoro to Malagarasi.
The country's decision comes due to the importance of the project to the development of the country.
The pledge was made in Madrid, Spain, by Secretary of State in-Charge of Commerce Ms Xiana Mendez, when she held talks with the Finance Minister Dr Mwigulu Nchemba, where, among other things, they discussed how to strengthen the bilateral cooperation between the two countries, including the construction of the massive SGR project.
She said Spain recognises the importance of the project to Tanzania and to her country as well, as its completion will increase the value chain of investment and trade and become a business hub in the African Region.
Ms Mendez praised Tanzania's strong economy and robust investment environment, which has made many companies from Spain wanting to invest and engage in infrastructure projects that will stimulate Tanzania's economic growth, including renewable energy.
She also promised that her country would open an office in Dar es Salaam due to increased trade relations between the two countries to facilitate trade activities.
For his part, Dr Nchemba, thanked Spain, through its Insurance Agency, for showing a willingness to enable Spanish companies to conduct business activities and build various infrastructure in Tanzania, including the Railway, through Loans, Loan and Insurance Guarantees.
"The participation of the Spanish Insurance Agency (Export Credit Agency-ECA) in implementing the strategic project is essential for the country's development and the long-term cooperation between Spain and Tanzania and the development of its people at large," Dr Nchemba said.
He said to strengthen relations and preparations for implementing the SGR funding, the contractor has sought 12 Spanish companies to supply the equipment used to build the railway and asked the Secretary of State and her Government, in general, to persuade more companies from the country to come forward to participate in the construction of the project.
Dr Nchemba said the SGR project is vital for Tanzania, because it is a trade gateway to seven land-linked African and Great Lakes countries that do not border the waters.
He further argued that when completed, the project will stimulate trade, transport and freight operations and ultimately increase GDP.
In addition, Dr Nchemba thanked Spain for funding the construction of various projects in the country, including the Rural Electricity Project (REA), water, health, transport, agriculture and the country's Development Agency through its Development Fund (FONPRODE), that showed interest in providing funding for the Msimbazi River Basin Development Project, in Dar es Salaam.
More than 3.24 billion US dollars is needed to complete the Standard Gauge Railway (SGR) construction for the third, fourth, and fifth phases running from Makutupora to Mwanza.
The visit of Dr Nchemba and his delegation to Europe is to meet and hold discussions with financial institutions and various stakeholders to secure funding for the railway construction.