AfDB approves $696 million for joint Tanzania-Burundi SGR

Men at work: Technicians work on the multi-billion SGR project. PHOTO | FILE

By  Paul Owere

Web Editor

Mwananchi Communications Ltd

What you need to know:

  • $696 million approved for Phase II of the Joint Tanzania-Burundi-DR Congo Standard Gauge Railway project.
  • 651 km of electrified single-track railway to be built, connecting Burundi to Dar es Salaam port.

Dar es Salaam. The African Development Bank Group has approved a $696.41 million financing package for Burundi and Tanzania to kickstart Phase II of the Joint Tanzania-Burundi-DR Congo Standard Gauge Railway (SGR) project.

This phase will see the construction of 651 kilometers of electrified single-track railway, connecting Burundi to the existing Tanzanian network and ultimately to the port of Dar es Salaam.

The project is divided into three sections: Tabora-Kigoma (411 km) and Uvinza-Malagarasi (156 km) in Tanzania, and Malagarasi-Musongati (84 km) in Burundi.

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This will link Burundi directly to the port Dar es Salaam, opening up new possibilities for its mining and agricultural sectors.

The Bank Group's commitment includes $98.62 million in grants for Burundi and $597.79 million in loans and guarantees for Tanzania.

Additionally, the Bank will act as the Initial Mandate Lead Arranger (IMLA), mobilizing up to $3.2 billion from commercial banks, Development Financial Institutions (DFIs), Export Credit Agencies (ECAs), and institutional investors. The total project cost is estimated at nearly $3.93 billion.

This ambitious project is expected to have a transformative impact on the region. Access to an efficient and cost-effective long-haul transport service will incentivize large-scale mining and commercial agriculture, particularly in Burundi with its massive nickel deposits.

 The SGR will also act as a catalyst for industrialisation and economic diversification by connecting key economic zones, industrial parks, and population centers along the corridor.

This project aligns with several key development strategies, including the East African Community (EAC) Rail Master Plan, the African Union's Program for Infrastructure Development in Africa (PIDA), and the Bank's own "High 5" and "Integrate Africa" priorities.

 It is also in line with the Bank's Regional Integration Strategy Paper for East Africa and its Country Strategy Papers for Tanzania and Burundi

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