Japan confirms 116bn/- budget support loan

12Apr 2016
Devota Mwachang'a
The Guardian
Japan confirms 116bn/- budget support loan

TANZANIA and Japan yesterday signed a 116bn/- loan agreement for General Budget Support, to be injected into projects aimed at improving the country’s business environment.

Permanent secretary in the Ministry of Finance and Planning, Servacius Likwelile (r) with representatives of the Japan International Cooperation Agency (JICA)

The loan, which is co-financed by Japan and the World Bank, will cover various local development policy reforms and eliminate existing critical business constraints, specifically in key job-creating industries and sectors.

The agreement was signed in Dar es Salaam by the permanent secretary in the Ministry of Finance and Planning, Servacius Likwelile, and the chief representative of the Japan International Cooperation Agency (JICA) in Tanzania, Toshio Nagase.

Briefing journalists, Nagase said the loan is meant to support the upcoming 2016/17 national budget and ensure a better local business environment all-round, including the introduction of various policy reforms for more jobs creation.

“The leading business environment constraints will be addressed by reducing unnecessary official procedures for registering and licensing a business”, the JICA representative explained.

Bureaucratic procedures in the Dar es Salaam port area will be eliminated in favour of more effective and more efficient customs services and tax administration, including the rationalization of tax incentives, he added.

The loan money will also be channeled towards simplifying processes for (business) land registration and access to finance/capital among micro, small and medium enterprises (MSMEs).

And apart from improving the business environment, the project is also geared to lowering agricultural transport costs, Nagase said.

“We are committed to support the government in various endeavors to accelerate its efforts to make Tanzania an industrialized, middle income nation as envisaged in the Vision 2025”, said the JICA rep.

Meanwhile, JICA is set to conduct a preparatory survey of Zanzibar’s urban water distribution facilities before embarking on a project to improve water services across the Isles.

According to Nagase, the project aims to improve the living environment for Isles residents by providing safe and clean water in West Urban region in Unguja Island. It will include the renewal of water supply facilities, reservoirs, elevated water tanks and distribution supply pipes.

The preparatory survey is to be conducted by a team of Japanese experts from today, stretching on to June next year. Nagase said the results will determine whether JICA should fund the project.

JICA supported Zanzibar’s urban water sector through two grant aid projects (2005-2010) valued at around 50.8bn/-, and also executed two technical cooperation projects (2008-2016) to improve the Zanzibar Water Authority (ZAWA)’s capacity to fulfill its supplying duty in Unguja.