Dar, Ankara in final talks on 740.2bn/- SGR funding

TURKEY: TANZANIA is in the final stages of negotiations with Turkey’s Exim Bank to secure 280 million US dollars (approximately 740.2bn/-) to complete the third and fourth phases of the Standard Gauge Railway (SGR) project, which are expected to strengthen regional connectivity and boost trade.

The negotiations took place yesterday in Antalya, Turkey, on the sidelines of the 31st Conference of the Parties to the United Nations Framework Convention on Climate Change (COP31).

The Tanzanian delegation was led by Finance Minister Ambassador Khamis Mussa Omar, while the Turkish Exim Bank team was headed by its Chief Executive Officer, Mr Ali Guney. Amb Omar said the two phases, covering more than 700 kilometres, require a total investment of 1.6 billion US dollars.

Of this amount, 1.32 billion US dollars has already been secured, leaving a financing gap of 280 million US dollars. He said securing the remaining funds would enable the government to complete the two phases and advance the country’s broader railway development agenda.

“The SGR is a major infrastructure project covering more than 2,000 kilometres. It aims to connect the coastal port city of Dar es Salaam with the western regions of Mwanza and Kigoma and neighbouring countries, including Rwanda, Uganda, Burundi and the Democratic Republic of Congo,” he said.

He explained that the project was divided into six sections, commonly referred to as lots, with the first two sections linking Dar es Salaam and the Government Headquarters in Dodoma already completed and operational.

“The first two lots have been completed and are operating, and they have been well received by the public,” Amb Omar said.

Highlighting the railway’s environmental benefits, he said Tanzania’s SGR differs from many railway projects in the region that rely on diesel, as it uses electricity.

“Unlike many railway projects in the region that depend on diesel, Tanzania’s SGR uses electricity. This is in line with the climate agenda being discussed at COP31, which emphasises the use of clean energy to protect the environment,” he said.

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For his part, Mr Guney said the bank recognised the importance of the SGR project to Tanzania’s development and the economic growth of neighbouring countries. He said the bank’s Board of Directors was expected to meet this month to consider Tanzania’s financing request.

“We value this project and recognise its importance to Tanzania and neighbouring countries. Our Board of Directors will meet this month to discuss the financing request required to complete the railway,” Mr Guney said.

Beyond the railway project, he said the bank was also exploring other areas of economic and commercial cooperation between Tanzania and Turkey, particularly financing for future infrastructure projects.

“We are also looking at other areas of cooperation between our two countries, including economic and commercial activities and financing future infrastructure projects such as roads and bridges,” he said.

He added that expanding cooperation in these areas would strengthen economic relations and create opportunities for increased investment and trade between the two countries.

The discussions are also in line with trade expansion targets set by President Samia Suluhu Hassan and her Turkish counterpart, President Recep Tayyip Erdogan, who are seeking to increase bilateral trade to at least 1 billion US dollars.