Tanzania has secured $6.7 million in grants from the Multilateral Cooperation for Development Financing (MCDF) to prepare three strategic infrastructure projects. The funds, equivalent to 17.73 billion Tanzanian shillings, will support the development of the Tanzania-Malawi 400kV Power Interconnector, the Lower Songwe Hydropower Project, and the Tanzania-Burundi Standard Gauge Railway (SGR). These projects aim to strengthen regional connectivity and attract investment.
Finance Minister, Ambassador Khamis Mussa Omar, announced the grants during the 11th Annual Meeting of the Asian Infrastructure Investment Bank in Doha, Qatar. He stated that Tanzania joined the MCDF as an observer in July 2025 and has since benefited from the grants. The minister emphasized that the funds will help prepare high-quality projects, strengthen their bankability, and mobilize additional financing.
The three strategic projects are crucial to Tanzania's economic transformation, as outlined in its Fourth Five-Year Development Plan for 2026/27-2030/31. The plan prioritizes investment in energy, transport, logistics, digital transformation, and regional connectivity. Ambassador Omar welcomed the MCDF's next strategic phase for 2027-2031, which will focus on regional connectivity, improved project readiness, broader partnerships, and climate resilience.
The MCDF plays a vital role in helping developing countries turn infrastructure needs into bankable projects through technical assistance and capacity building. AIIB President Zou Jiayi highlighted the fund's expanding focus to include bridge financing and emerging sectors such as smart housing and digital education. She emphasized the importance of transparency and prudent management of resources contributed by member countries and development partners.
Ambassador Omar expressed Tanzania's appreciation for the MCDF's support and looked forward to continued cooperation with the fund, AIIB, multilateral development banks, and other development partners. The government aims to prepare infrastructure projects capable of attracting long-term investment. The minister's remarks were made during a session of finance ministers, who are governors of the Asian Infrastructure Investment Bank.
The Tanzania-Malawi 400kV Power Interconnector, the Lower Songwe Hydropower Project, and the Tanzania-Burundi Standard Gauge Railway (SGR) are expected to have a significant impact on the region. These projects will enhance energy security, promote economic growth, and improve transportation links between Tanzania, Malawi, and Burundi.
The MCDF's support for Tanzania's strategic infrastructure projects demonstrates the fund's commitment to helping developing countries achieve their development goals. With the grants, Tanzania is poised to make significant progress in preparing its infrastructure projects and attracting investment. The country's cooperation with the MCDF and other development partners is expected to yield long-term benefits for its economy and people.
Key points
- Tanzania receives $6.7 million in MCDF grants to support preparation of three strategic infrastructure projects.
- The grants will support development of the Tanzania-Malawi 400kV Power Interconnector, the Lower Songwe Hydropower Project, and the Tanzania-Burundi Standard Gauge Railway (SGR).
- The projects aim to strengthen regional connectivity and attract investment, aligning with Tanzania's Fourth Five-Year Development Plan.
