Finance Minister Dr. William Mgimwa
The government yesterday signed a loan agreement for SDR 64.9 million equivalent to $ 100 million with the World Bank soft loan window, International Development Association (IDA) as additional credit to support the implementation of the second Central Transport Corridor Project.
Speaking in Dar es Salaam at the signing ceremony, Finance Minister Dr. William Mgimwa said that additional financing would cover cost overturns in the implementation of the Dar es Salaam Bus Rapid Transit (BRT) system. Cost overturns are caused by higher than initially anticipated BRT infrastructure development costs, he stated.
Dr Mgimwa affirmed that with the additional financing, the total credit for the project is now revised from the original credit of SDR 115.4 million, equivalent to$ 190m which was signed on July 2008 to SDR 180.3m or $290 to date.
The project consist three parts, including improving Dar es Salaam city urban transport, support Tanroads and improve Zanzibar Airport and transport studies.
The initial project rating was moderately satisfactory until 2010, thereafter the project was downgraded to moderately unsatisfactory due to continued delays in procurement, land acquisition and failure to comply with covenants for the BRT bus operation.
He said funds under the loan agreement signed will be used as intended towards implementation of the project, whereby through Tanroads the government will closely monitor its progress, in order to ensure capacity of construction agents to realize value for money.
Dr. Mgimwa affirmed that up to 2015 BRT the project should be completed including building two separate road ways, to build feed stations, bus terminals and adequate drainage facilities.
For his part, the World Bank director for Tanzania, Uganda and Burundi, Philippe Dongier said that the bank is looking forward and make all possible efforts to ensure car congestions and pollution are terminated in the city.
He thanked city residents and the authorities for support they are providing to support the BRT project to be carried on without problems.
Dongier stated that BRT will be a milestone for individual and broader economic development, whereby currently economic growth goals are not achieved because of the poor transportation system in the city.
The closing date of the project was extended from December 31, 2014 to December 31, 2016 to enable completion of BRT infrastructure works and cover the first year of operation of the BRT system.
In addition to the BRT, Dongier said that the project is also financing the Zanzibar airport runway upgrading, which is already completed.
It also conducts capacity building and project management support to Tanroads, DART, and the Zanzibar Ministry of Infrastructure and Communications. “Construction of the Dar es Salaam BRT system is progressing well. Cooperation from the authorities and from residents of Dar es Salaam has been excellent. There is high commitment to reduce traffic jams that reduce productivity, threaten future growth prospects, and pollute the environment.
“The World Bank remains strongly committed to helping the Government in the implementation of MKUKUTA which underscores the need for improved transport infrastructure to achieve social and economic objectives.”