16 February 2021, Dodoma: Today, the Permanent Secretary of the Ministry of Finance and Planning of the United Republic of Tanzania, Mr. Doto M. James, and the Ambassador of the European Union to Tanzania and the East African Community, H.E. Manfredo Fanti, have signed six projects for a total amount of 111.5 million Euros, equivalent to more than 307.9 billion Tanzanian Shillings, in grants.
This new funding will benefit the Tanzanian people and the development of the country by promoting important reforms and concrete actions in the energy sector as well as enhancing a conducive environment for business in the country and increased competitiveness.
Energy: With 35 million Euros (96.7 billion Shillings), the Energy Sector Reform project will benefit the Ministry of Energy, the Tanzania Electric Supply Company – TANESCO and the regulator EWURA. To reduce charcoal consumption in cities, clean cooking alternatives will be proposed through a new CookFund, while sustainable forest management in rural districts will be promoted (30 million Euros, equivalent to 82.8 billion Shillings).
Private Sector Development: The BEGIN program worth 23 million Euros (63.5 billion Shillings) will support Tanzania’s Blueprint for regulatory reforms to improve the business environment and attract private sector investment. Looking at agricultural exports to Europe and the rest of the world, an additional 10 million Euros (27.6 billion Shillings) will help ensure better controls, standards and safety of plant material. Value chain development of the beekeeping sector will also be supported (with 10 million Euros equivalent to 27.6 billion Shillings), with a view to improve production, processing and marketing of bee products.
These different actions will be complemented by additional Technical Cooperation Facility Programme worth 3.5 million Euros (9.7 billion Shillings) to support identify and formulate new priority projects and thus support Tanzania’s achievement of its social and economic goals.
During the signing ceremony, EU Ambassador Manfredo Fanti added that: “The new agreements we have signed today will address challenges in various sectors. They will stimulate inclusive growth, private sector development and employment, economic integration and trade but also climate change adaptation and mitigation. All these areas are key for improving the livelihoods of the Tanzanian people and help the move towards the country’s industrialization and sustainable growth path.”
Speaking on behalf of the Government of Tanzania, the Permanent Secretary of the Ministry of Finance, Mr. Doto M. James emphasized that: “EU is one of our key strategic partners in terms of supporting government efforts in achieving sustainable development. This is substantiated by the sizable financial supports that EU has extended to Tanzania since the signing of the first Partnership Agreement between EU and African Caribbean and Pacific States in 1975. So far, Tanzania has received from EU about 2,394 million Euros (equivalent to 6.6 trillion Shillings) as grants and a total of 270.9 million Euros (equivalent to 748.2 billion Shillings) as concessional loans from the European Investment Bank. These funds have supported interventions in various sectors including macro-economic support, sector policies, road transport, airports, energy, agriculture, environment and climate change adaptation and mitigation.”
The implementation of these actions will start immediately after the signing of the different projects, while Tanzania and the European Union are also preparing their future cooperation framework for the period 2021-2027.
The European Union and the Republic of Tanzania are long-term partners. The European Union has provided key support for development in Tanzania, with a total grant funding of EUR 556 million during the period 2014-2020. Such support has focused on:
The Tanzania Energy Sector Reform Programme (EUR 35 million, equivalent to TZS 96.7 billion) will improve the operations and organisation of the national power utility company TANESCO to sustain the development of Tanzania's energy sector. Focus will be on better service delivery for the end consumers and facilitating private sector investment in power generation. Modernization of TANESCO will improve management practices and digitalization of internal systems, and reinforce TANESCO's Zonal offices for better maintenance of the national grid by providing heavy machinery, equipment, tools and pre-paid meters. The Ministry of Energy and the regulator EWURA will benefit from improved management and dissemination of energy data and statistics to improve planning of the energy sector like the new Power System Master Plan.
The Integrated Approach to Sustainable Cooking Solutions Programme (EUR 30 million, equivalent to TZS 82.8 billion) will increase sustainable and efficient wood-fuel production in rural districts, particularly in those producing charcoal for big cities like Dar es Salaam, while working to regulate the charcoal sector and promote alternative livelihoods for people dependent on charcoal as an income. Modern and clean cooking solutions will be rolled out in urban areas through a new “CookFund” that will be set up to promote investment of small and medium sized enterprises willing to invest and roll out alternatives to charcoal. End-consumers will be incentivized to switch to clean alternatives. The programme will be accompanied by an awareness raising campaign on the negative impact charcoal production and consumption has on health of women and children in particular, and on the environment.
Through the Tanzania Beekeeping Value Chain Programme (EUR 10 million, equivalent to TZS 27.6 billion) increased quality production of bee products will be ensured through training and laboratory support, while the capacity of the aggregators will be strengthened. Improved processing and packaging will ensure better access to local, regional and international markets. The programme will increase employment in the sector and allow for sustainable income generation and nutrition from Tanzania’s forests.
Under the Programme to Strengthen Plant Health Services for Enhanced Food Safety (EUR 10 million, equivalent to TZS 27.6 billion) support to the national Plant Health monitoring system will be strengthened to facilitate import and export of agricultural products and ensure a reliable plant health surveillance and protection system. The inspection capacity at border inspection posts and reference laboratories will be improved and the newly formed Tanzania Plant Health and Pesticides Authority accompanied in their operations. The project is co-funded by the FAO for EURO 350,000 and the Government of Tanzania for EURO 250,000. The project will greatly contribute in making it easier to export products to the European market.
The EU Support for Business Environment, Growth and Innovation - BEGIN (EUR 23 million equivalent to TZS 63.5 billion) will promote inclusive economic growth, enhance consumer protection and create employment opportunities through innovation, in particular for women and youth. More specifically, the programme will support the Ministry of Industry and Trade to implement Tanzania’s Blueprint for Regulatory Reforms to improve the Tanzania Business Environment. The programme also focuses on increasing compliance of Micro, Small and Mediums sized Enterprises (MSMEs) with quality standards to widen market access, reduce standards compliance costs, and enhance consumer protection and on improving the environment for entrepreneurship and innovation, particularly for women and youth-led MSMEs.
Technical Cooperation Facility – Phase II (EUR 3.5 million equivalent to TZS 9.7 billion). The facility will support Tanzania's progress towards the Sustainable Development Goals (SDGs) and achievement of EU-Tanzania cooperation goals. It is a tool for Tanzania to identify and formulate new priority projects in the framework of EU – Tanzania cooperation.