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Tanzania to avoid loans with stringent conditions

December 5, 2018
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Tanzania’s president, John Magufuli has called out multilateral financing institutions for setting tough loan conditions, saying the government will henceforth avoid such loans.

Mr. Magufuli, who was laying the foundation for water project in Arusha, commended the African Development Bank (AfDB) for ‘soft loans’ facility.

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‘‘The AfDB) has less stringent terms, and you can see what it has done for Tanzania, ’the president said.

Currently, the AfDB is financing a water project a water project in Arusha at a cost of US$226 million, which is projected to triple water supply in the city from 45m litres a day to 200m, when it is completed in 2020.

The president went on to explain that projects that have been funded by the pan-African bank, have a direct impact on the economy.

He cited projects like the AfDB-funded roads connecting Burundi, Tanzania and Kenya, saying they are better than loans focused on institutional reforms and feasibility studies, ‘which are never completed’.

Magufuli recently held crisis meetings with the World Bank as the latter held back a US$300m loan towards education projects.

The global lending institution asked the Tanzanian government to review its policies towards pregnant girls in school, before the loan could be approved.

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