TANZANIAINVEST has interviewed Mr. B. C. Muhegi, Registrar of the Tanzania Contractors Registration Board, in order to learn about the Tanzania construction sector, the role…
Construction in Tanzania contributed 12.5% to its GDP during 2014 with USD 6bn, while in 2008 the sector accounted for only 8.8% of the country’s GDP or USD 1.9bn.
The growth rate of the Tanzanian construction sector was 17.6% in Q3 2015. According to the Tanzania National Bureau of Statistics (NBS), the growth was attributed to the ongoing construction of roads, residential and non-residential buildings.
Tanzania’s real estate sector is mostly driven by the increasing demand for urban accommodation and accounted for 3.7% of the country’s GDP (USD 1.8bn) during 2014.
Water supply in Tanzania accounted for USD 240m or 0.5% of its GDP in 2014, compared to USD 150m or 0.7% of its GDP in 2009, representing an increase of 60% over the 5–year period.
According to the country’s 2025 Development Vision, investments in Tanzania’s infrastructure, particularly in the development of the road network, must be the Government’s top priority.
The World Bank (WB) and the African Development Bank (AfDB) support Tanzania in achieving its infrastructure development goals by providing grants and credits for projects.
The WB’s Infrastructure Projects in Tanzania
The WB’s current portfolio in Tanzania includes 25 projects with a commitment of nearly USD 4bn, most of which is dedicated to transport development.
In April 2014, the WB approved the Intermodal & Rail Development Project of Tanzania to support the development of a reliable railway infrastructure on the Dar es Salaam-Isaka section of the East African Central Corridor, mainly by building new terminals and reconstructing bridges.
According to the WB, the Intermodal & Rail Development Project will consequently help to promote agricultural trade and job creation across the country.
In March 2015, the WB approved the Dar es Salaam Metropolitan Development Project to improve urban services in Dar es Salaam by upgrading and building priority roads and drainage systems.
Both projects are expected to be completed by 2020 with an overall cost of financing of USD 600m provided by the International Development Association (IDA).
The AfDB’s Infrastructure Projects in Tanzania
As of 30th November 2015, the AfDB’s portfolio in Tanzania consists of 29 projects with total net commitment of USD 1.97bn, nearly half of which is allocated to transport infrastructure.
In line with the AfDB’s 2016–2020 Country Strategy Paper (CSP) for Tanzania, the Bank will focus on supporting the transport and energy sector in the country during the next five years by improving the domestic and regional transport network and to provide access to affordable electricity.
The AfDB’s 2016–2020 approved assistance package for Tanzania exceeds USD 1.1bn. Additional resources will be provided from the Africa Growing Together Fund (AGTF), trust funds, renewable energy financing and co-financing with other partners.