Applause as President Samia expedites strategic projects
President Samia Suluhu Hassan (in the background, wearing a facemask) witnesses the signing of contracts between the Tanzanian government and contractors for the Tabora-Isaka section of the Standard Gauge Railway in July 2022. PHOTO | FILE
What you need to know:
- President Hassan is on record as saying the government will continue seeking loans, if it has to, as it seeks to finance the strategic projects in the country for long-term development
Dar es Salaam. When President Samia Suluhu Hassan came to power in March 2021, pundits may have been wondering whether Tanzania’s first woman president would continue with the implementation of mega development projects.
The strategic projects, initiated by the government when she was Vice President, include the 2,115 MW Julius Nyerere Hydropower Project (JNHPP), the Standard Gauge Railway (SGR) line, and the revival of Air Tanzania Company Limited (ATCL).
The list also includes the $308 million Kigongo-Busisi Bridge that links the areas of Kigongo in Mwanza and Busisi in Geita; flyovers in Dar es Salaam; the construction of outer ring roads in Dodoma and Arusha; the improvement of airports and seaports; and the construction of roads and bridges across the country, among others.
In her first speech after she was sworn in President Hassan said she would make sure the new Msalato Airport in Dodoma was constructed. The process to build the airport has started and the contractor has already beeen identified.
Another strategic mega-project is the construction of the East African Crude Oil Pipeline (Eacop). An economist from the University of Dar es Salaam, Prof Abel Kinyondo, commended President Hassan for avoiding the trap of abandoning the megaprojects.
“She (the President) has been very disciplined in keeping things moving. This is a unique characteristic in Africa because the majority of new leaders would want to come up with their own new projects as soon as they assumed office,” said Prof Kinyondo.
Her consistency will attract investors because they always love investing in countries with a predictable business environment so that they can be sure about the future of their projects.
“Investors hate unpredictability. Without continuity, serious investors will not come,” he cautioned. He went further, saying abandoning the multi-billion-dollar mega projects would have been a huge blow to the country.
“By continuing to implement the mega strategic projects, President Samia Hassan would leave a rich legacy,” concluded Prof Kinyondo.
Prof Aurelia Kamuzora from Mzumbe University also said mega strategic projects will shape the country’s economy positively.
Investors, she said, need a sufficient power supply and a good transport network, and that is why President Hassan has seen the importance of continuing where her predecessor left off.
President Hassan is on record as saying the government will continue seeking loans to finance numerous strategic projects in the country for long-term development.
“As long as we borrow strategically, there is nothing to worry about,” said Prof Kamuzora.
Because of the ongoing implementation of the megaprojects, the national debt has increased by Sh6.9 trillion in the 12 months ending January 2023, according to the Bank of Tanzania’s Monthly Economic Review.
Under the period under review, according to the central bank, the national debt jumped from $37.6 billion (Sh86.5 trillion) in January 2022 to $40.6 billion (Sh93.4 trillion) in January 2023.
The projects have had a positive impact on the economy.
If you look at the Kijazi (Ubungo) Interchange, it has reduced traffic jams for transporters who ferry cargo from the Dar es Salaam port to destinations upcountry and outside the country.
Dr Lutengano Mwinuka from Dodoma University says it is good that the sixth regime decided to continue implementing all strategic projects.
“The progress of the projects’ implementation is good. We hope there will be no hurdles on the way,” he asserted.
He went on to explain: “Mega projects need adequate funding... The component of access to finance can be a limited factor, including but not limited to the way we service the loans.”
When she took power in March 2021, President Hassan promised to continue with megadevelopment projects and initiate new ones.
JNHPP to end the power crisis
True to her promise, on December 22, 2022, she graced the water filling of the JNHPP.
The filling of the dam with water followed the completion of the construction of the diversion channel at the project.
The dam has the capacity to store up to 33.2 billion m3 of water. With President Hassan increasingly pumping funds into the Sh6.5 trillion project, its actual implementation has been at a speed that has never been witnessed before.
Speaking during a media tour of the project site in August last year, Energy Minister January Makamba said until that time, actual construction had reached 67.18 percent, a massive leap from the 37.4 percent that was done between December 2018 and June 2021. In fact, the latest data show that actual construction has reached over 80 percent.
This suggests that in just one year, to July 2022, the rate of implementation of the project, which has employed 12,000 people, with Tanzanians accounting for 90 percent, has more than doubled.
SGR, a game changer
Late December last year, Tanzania inked a $2.2 billion deal with two Chinese contractors that will see the final section of the 2,102 km SGR, the longest stretch of the modern railway line on the African continent, completed by 2026.
The 2,561-kilometre network, whose construction began in 2017 under a consortium of Yapi Merkezi, Turkey, and Mota-Engil, Portugal, will link the port of Dar es Salaam to Mwanza on Lake Victoria, with eventual spurs to Burundi, the Democratic Republic of the Congo (DRC), Rwanda, and Uganda.
That means, far from the sentiments of some doubting Thomases, the project is now being implemented at a faster speed than it used to be in the past.
President Hassan said recently that so far, a total of $10.04 billion (Sh24 trillion) has been injected into the project.
“Upon completion of the SGR, Tanzania will be in a better position to utilise its strategic geographical positioning to facilitate cross-border trade,” said President Hassan.
She said the new railway would 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.
So far so good with LNG
The conclusion of negotiations on the planned LNG project in Lindi will be made soon.
The government negotiation team and the multinationals Shell and Equinor and their partners have already agreed on key issues, leading to the signing of the initial Host Government Agreement (HGA).
Mr Makamba said recently that they were currently on the drafting stage of the HGA, adding that the exercise requires a lot of time and attention so that everything gets written the way it was agreed.
Restore the lost glory
During the 2015 election campaigns, the then CCM presidential candidate John Magufuli promised to revive the ATCL, which by then had only one aircraft that was grounded for maintenance.
True to his promise, until he met his demise, his government had purchased 11 aircraft.
A month after President Hassan took power, she promised that the government would continue to nurture the national carrier strategically to enable it to operate effectively and efficiently.
This year, ATCL is expecting to receive five more aircraft, one of which will be for cargo, to bring the total of its fleets to 16.
EACOP
Late President Magufuli and Ugandan President Yoweri Museveni, commissioned the construction of the 1,443-kilometre-long East African crude oil pipeline from Hoima district in Uganda to the Tanzanian port of Tanga.
His successor has not let him down, and this could be attested to by the government’s approval last month for the construction of a $3.5 billion EACOP.
The pipeline will transport crude from vast oilfields being developed in Lake Albert in northwestern Uganda to a Tanzanian port on the Indian Ocean.
The pipeline required approval from both countries, and last month Uganda issued a license to the project operator, the AEACOP.
As for the construction of the Kigongo-Busisi Bridge in Mwanza, available data show that it had reached 60.05 percent by late last December.
