China inks $2.2 billion deal with Tanzania
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By Gerro Biko GAROWE ONLINE
- Posted On 21-12-2022, 03:49PM
ARUSHA - The Tanzanian government has contracted a state-owned Chinese company to build the final section of the Tabora - Kigoma Standard Gauge Railway at the cost of $ 2.2 billion.
President Samia Suluhu Hassan witnessed the signing of the construction contract which will be completed in 2026.
"I believe that once this new SGR is completed Tanzania will be in a better position to utilize its strategic geographical positioning to facilitate cross-border trade," President Hassan.
Once completed the 2,561-kilometre line will link the Indian Ocean port of Dar es Salaam to Mwanza on Lake Victoria, with eventual spurs to Burundi, the Democratic Republic of Congo (DRC), Rwanda, and Uganda.
So far Tanzania's investment in the SGR and other transport sectors has hit $10.04 billion, including the latest contract.
President Hassan "I know our critics are blaming us for taking up these loans but they must understand that a better infrastructure is key to driving growth in our country and also making Tanzania competitive at the regional level.”
The Tabora-Kigoma SGR railway will reduce cargo transportation costs between the Dar es Salaam port and the DRC from a minimum of $6,000 per tonne to about $4,000 once it becomes fully operational.
Meanwhile, transportation time would fall from 30 days by truck to 30 hours in 2027.
China is the biggest investor in Africa, pumping billions of dollars into railroads, ports, and airports in exchange for securing oil and commodity supplies such as copper and cobalt.
These infrastructure projects are built through vast loans issued by China, but Beijing has been criticized for lending too much to poor countries, without sufficiently scrutinizing their ability to repay.
Tanzania's railway system has two existing networks, one linking the East African nation to Zambia and the other connecting it to Kenya and Uganda.
