Tanzania and the Abu Dhabi Development Fund of the United Arab Emirates have signed a low-interest loan agreement of $30 million, equivalent to 70 billion Tanzanian shillings.
This loan is intended to construct a 220 kV power transmission line from Benaco to Kyaka and expand the Kyaka Power Substation in the Kagera region.
The signing ceremony took place at the headquarters of the Abu Dhabi Fund for Development in Abu Dhabi. Tanzanian Minister of Finance, Dr Mwigulu Nchemba, signed on behalf of the government, while the Director-General of the Abu Dhabi Fund for Development, Mohammed Saif Al Suwaidi, represented the fund.
Dr Nchemba stated that the project involves constructing a 167-kilometre power transmission line from Benaco to Kyaka. According to the Ministry of Energy, the project’s total cost is expected to be $119.4 million.
“This loan we have signed will contribute to the efforts of other funds, including the OPEC Fund for International Development, which provided $60 million, the Saudi Fund for Development with $13 million, and the Tanzanian government with $2.4 million,” said Dr Nchemba.
Completing the Benaco-Kyaka electricity project will improve the electricity supply situation in the Lake Zone regions, where there has been a shortage of unreliable power. Additionally, it will enable the Kagera region to transition from using electricity from neighbouring Uganda to utilizing the National Grid.
Dr Nchemba commended the Abu Dhabi Development Fund for supporting the initiatives of the Sixth Phase Government, led by President Samia Suluhu Hassan.
These efforts aim to bring development to citizens through energy projects, fostering economic growth and employment opportunities in areas where electricity infrastructure is being developed.
“Thus far, the Abu Dhabi Development Fund has invested $96.6 million in Tanzania for various economic and social projects, being a significant development partner for a considerable period,” Dr Nchemba added.
Muhamed Saif Al Suwaidi, the Chief Executive Officer of the Abu Dhabi Development Fund, reaffirmed the fund’s commitment to financing strategic projects in Tanzania. This support aims to help the country achieve its development goals, as the Five-Year National Development Plan outlines.
“This strategic project to provide electricity to citizens is a crucial step towards realizing the desires of the people for development. It also demonstrates the strong collaboration between Tanzania and the United Arab Emirates, which have plans to continue their partnership due to being key development stakeholders,” Al Suwaidi stated.
He emphasized that the fund will explore other collaboration opportunities in various economic sectors in Tanzania, including tourism, agriculture, modern housing construction for Zanzibar’s Revolutionary Government employees, road infrastructure, and energy.
Among the projects funded by the Abu Dhabi Development Fund in Tanzania are the construction of the Wete-Pemba Hospital, the Kidawe-Uvinza road (77 km), the Kagera Sugar Factory, and the rural Zanzibar water project, which is now completed. They are currently financing the construction of the Uvinza-Ilunde to Malagarasi road, valued at $15 million.