Tanzania secures $1.2 billion loan to build SGR line to Kigoma
Nine banks have lent Tanzania $1.2 billion for the 411km Tabora-Kigoma section of its standard gauge railway, Mwananchi reported. The African Development Bank arranged the deal and backs it with an $800 million partial guarantee.
Tanzania has secured a $1.2 billion (TSh 3.17 trillion) commercial loan to build the 411km Tabora-Kigoma section of its standard gauge railway (SGR), Mwananchi reported. The African Development Bank (AfDB) arranged the deal, which involves nine banks. The loan is part of a wider $2.3 billion package for the section. In a statement on Wednesday, the AfDB said it was providing an $800 million partial credit guarantee. According to the bank, the guarantee unlocked funding from commercial lenders. It covers the principal of the guaranteed portion plus two years of interest. Separately, credit insurance arranged by broker Texel spreads $405.5 million of risk across international insurers, including syndicates in the Lloyd's market. Deutsche Bank and Société Générale led the group of lenders. HSBC, Commerzbank, Nedbank, Stanbic Bank Tanzania, First Abu Dhabi Bank, FirstBank UK and Bank of Africa United Kingdom also took part. Their funding splits into $720 million in guaranteed loans and $480 million lent on the strength of Tanzania's sovereign credit. Benny Mwaipaja, communications director at the Finance Ministry, confirmed the deal but gave no further details. Transport Permanent Secretary Prof Godius Kahyarara said Tanzania is now assured of linking Tabora, Kigoma and Burundi.…
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