Standard Chartered Bank signs $1.46 billion 550-kilometer long railway project with Tanzania

The SGR Rail project will provide a safe and reliable means for efficiently transporting people and cargo to and from the existing Dar es Salaam Port

The Standard Chartered Bank has signed $1.46 billion railway project with Tanzania.

Standard Chartered CEO Sanjay Rughani with Minister of Finance and Planning Hon. Phillip Mpango (Source: Standard Chartered |
Standard Chartered CEO Sanjay Rughani with Minister of Finance and Planning Hon. Phillip Mpango (Source: Standard Chartered |

The agreement between the Tanzanian Ministry of Finance and Standard Chartered Tanzania is to fund the construction of the Standard Gauge Railway (SGR) project from Dar es Salaam to Makutupora, a distance of about 550 kilometers or about 341 miles.

It is one of the country’s biggest projects connecting Dodoma to Dar es Salaam via Morogoro and Makutupora.

Once complete, the SGR Rail project is expected to provide a safe and reliable means for efficiently transporting people and cargo to and from the existing Dar es Salaam Port.

It will also connect Tanzania to Burundi, Rwanda and The Democratic Republic of Congo, DRC, thereby playing a key role in enhancing regional trade.

According to the Tanzania Railways Corporation, it is expected that the railway will address current congestion challenges and decrease freight service charges by 40%, as the railway will be able to haul up to 10,000 tons of freight, equivalent to 500 lorries, per trip.

The project has reportedly already created more than 8,000 new direct employment opportunities for Tanzanians and has opened up opportunities for the local communities surrounding the project area to access social services such as shelter and food.

Standard Chartered Tanzania acted as Global Co-ordinator, Bookrunner and Mandated Lead Arranger on the facility agreement that is the largest foreign currency financing raised by the Ministry of Finance to date. The biggest component of financing comes from the Export Credit Agency Covered Facility(‘s) from the Export Credit Agencies of Denmark and Sweden.

“I am very delighted to sign off on this deal on behalf of the Government of Tanzania and its people. With the help of Standard Chartered and our partners, the project financing will further increase direct employment in Tanzania, and more importantly, enable our local communities the thrive as they will be able to gain access to wider social services such as food and housing,” said the Minister of Finance and Planning, Dr. Philip Mpango, at the event to sign off the deal.

Mr. Mpango commended and thanked Standard Chartered bank, the Governments of Sweden and Denmark, which were represented by their Ambassadors in Tanzania, for their confidence in the country’s economic growth.

“These two nations, Sweden and Denmark, have shown us their true friendship not only in words but also in action. Please convey our country’s sincere appreciation to the Export Credit Agencies and lenders in your countries that have supported this signature project. As a country we shall honour our commitments as we have always done,” Dr. Mpango said.

In addition to thanking the Export Credit Agencies and lenders, Mpango also thanked the Development Bank of Southern Africa (DBSA), the Trade and Development Bank (TDB) and the African Export-Import Bank (Afrexim), for supporting the project in partnership with Export Credit Agencies from Denmark and Sweden.

He said the funding would enable the project to be completed in good time as per the set plans.

Mr. Sanjay Rughani, Chief Executive Officer, Standard Chartered Tanzania, said the deal signified investor confidence in the market and demonstrated Standard Chartered’s international network capabilities and commitment to Tanzania.

“As a leading international Bank for Africa, with over 100 years of being in Tanzania, the African continent remains a key corridor not only for Standard Chartered but also our global clients. We are delighted to have reached this milestone in Tanzania to fund the SGR project that will deliver massive benefits to Tanzania and support the government’s 2025 vision of making Tanzania an industrialised country.” Mr. Rughani said.

Mr. Rughani added that the Bank will continue to leverage its unique network reach, and the credibility it has built over time, to further position Tanzania as the go-to destination for investments.

Sunil Kaushal, Regional CEO, Standard Chartered Africa and the Middle East said the deal signified the benefit of our unrivalled network capabilities into the region.

“There is considerable appetite from the global investment community into Africa, with 80 percent of our top Corporate & Institutional clients using our Africa and Middle East network. For Standard Chartered, Africa remains a priority for our business and clients, and we are proud to be able to use our expertise to support the Government of Tanzania with the finance needed for the SGR project.”

The sign off ceremony was also attended by the Ambassador of Denmark to Tanzania, Mette Norgaard Dissing-Spandet and the Ambassador of Sweden to Tanzania, Anders Sjoberg.

In attendance was also Robert Mengoni, the Ambassador of Italy to Tanzania and Mr. Calumm Mcallum, Country Director, International Trade – for the British High Commission. The Country Manager for the Africa Development Bank Dr. Alex Mubiru and Resident Representative for the IMF in Tanzania, Mr. Jens Reinke also attended the event.

Other key Government Officials included the Permanent Secretary from the Ministry of Finance and Planning, Mr. Doto James, Deputy Governor of the Bank of Tanzania responsible for Economic and Financial Policies, Dr. Yamungu Kayandabila, and the Director General of the Tanzania Railway Corporation, Mr. Masanja Kadogosa.  

Simon Ateba
Simon Ateba
Based in Washington, District of Columbia, United States of America, Simon leads a brilliant team of reporters, freelance journalists, analysts, researchers and contributors from around the world to run TODAY NEWS AFRICA as editor-in-chief. Simon Ateba's journalistic experience spans over 10 years and covers many beats, including business and investment, information technology, politics, diplomacy, human rights, science reporting and much more. Write him: simonateba@todaynewsafrica.com

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Editor's Pick title

- Advertisement -woman in black scoop neck shirt smiling 38554 scaled

TOP NEWS

error: Support good journalism. Donate
207 Shares
Share
Pin
Tweet
Reddit
WhatsApp