Tanzanian President Jakaya Kikwete announced during his meeting with journalists in Dar es Salaam on April 20th 2014 that the bill regulating the Sovereign Wealth Fund (SWF) to manage proceeds from natural gas activities is projected to be revealed to the National Assembly in October 2014 or February 2015.
“Now that we have already formulated the National Gas Policy, the next move is to formulate the wealth fund” President Kikwete declared.
“Natural gas is not renewable and thus we want to make sure that generations benefit from it through the fund which will be managed by the Bank of Tanzania (BoT)” he added.
Aiming to avoid the so called Dutch Disease – a resource curse when upon discoveries of natural extractable resources the country stops investing in manufacturing and becomes dependent – the Tanzanian government decided to establish a Sovereign Wealth Fund to manage proceeds from natural gas.
The Sovereign Wealth Fund is expected to monitor and safeguard profits from natural gas, and will be in place to ensure that current and future population benefits from officially estimated 46 trillion cubic feet natural gas discovery.
The legislation regarding the SWF will determine which percentage of natural gas proceeds will be contributed to the national budget every year.
With the help of the SWF Tanzania is planning to overcome dependency on natural resources and to be regarded as a Middle Income Level economy by 2025.