DAR ES SALAAM: VICE-PRESIDENT Dr Philip Mpango has urged the Rural and Urban Roads Agency (TARURA) to expedite the adoption of innovative technologies for designing highquality, cost-effective roads and bridges.
The VP also called on the agency to explore alternative revenue streams to ensure timely implementation of infrastructure projects.
Dr Mpango made the remarks in Dar es Salaam during the launch of the Samia Infrastructure Bond, which aims to raise approximately 150bn/- to fund rural road projects managed by TARURA.
“I am aware that many of you are innovative and this country has a wealth of talented youth. I encourage you to intensify efforts in innovation and embrace modern technologies in construction to reduce costs and improve quality,” Dr Mpango said.
The Samia Infrastructure Bond, designed to support TARURA’s road upgrade initiatives, is now available for purchase with a minimum investment of 500,000/-. Officially launched on Friday, it will remain on the market for one month until January 17 next year.
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The bond is expected to finance the construction or upgrade of approximately 1,500 kilometres of roads, improving rural connectivity and reducing travel times by up to 50 per cent.
Furthermore, the bond will alleviate liquidity challenges for TARURA-certified contractors, potentially increasing cash flow by 40 per cent and reducing project delays.
This will benefit 400 to 600 firms, ensuring timely completion of infrastructure projects and fostering national development.
The bond is issued at par value, offering a fixed annual interest rate of 12 per cent with a five-year maturity and quarterly coupon payments. Additionally, this initiative marks a significant step in improving country’s road infrastructure, particularly in rural and urban areas. By funding TARURA’s projects, the bond seeks to enhance the country’s transport networks, foster economic growth and facilitate community development.
Moreover, Dr Mpango urged the Capital Markets and Securities Authority (CMSA), the Bank of Tanzania (BoT) and other stakeholders to establish an early warning system.
This system would monitor and identify potential risks affecting the strategic bond, such as liquidity challenges in the banking sector and fluctuations in domestic and global interest rates.
CRDB Bank Managing Director and Group CEO Mr Abdulmajid Nsekela said that the funds raised will facilitate the payment of contractors involved in building and upgrading roads in urban and rural areas.
“We take pride in introducing this special bond aimed at raising funds for urban and rural road infrastructure projects. Through the bond, the expected money will be used to pay contractors currently working on or set to undertake road construction projects,” said Mr Nsekela.
Equally, the CMSA Chief Executive Officer Mr Nicodemus Mkama highlighted the innovative nature of the bond, which combines public and private sector collaboration.
He said that it makes Tanzania a pioneer in SubSaharan Africa, offering a bond that targets districtlevel road infrastructure development while engaging Tanzanian-owned construction firms.
“The bond sets a strong precedent for public and private sector institutions on how to raise capital for selfsustaining projects through capital markets,” Mkama added.
Minister of State in the President’s Office – Regional Administration and Local Government (PO-RALG), Mohamed Mchengerwa said that CRDB Bank is the only institution that has aligned with the ministry’s objectives in its strategy to secure reliable funding for road construction in the country.
“To construct roads at the required pace, substantial funding is necessary. Therefore, the ministry deemed it wise to seek alternative revenue sources. “Once again, I commend the lender for this innovative initiative, which will significantly aid in securing funds on time, ensuring that many projects are completed as planned,” said Mr Mchengerwa.
On his part, the TARURA’s Chief Executive Officer, Eng Victor Seff said that the fund raised from the bond will facilitate timely funding, accelerate the completion of road infrastructure and address challenges in various parts of the country.
“The responsibility now lies solely with contractors to perform their tasks to acceptable standards and contribute to building our nation. “It is crucial for contractors to demonstrate professionalism in all projects assigned to them. CRDB Bank’s efforts to mobilise funds from citizens must result in durable roads,” added Engineer Seff.
