Tanzania’s ongoing macroeconomic reform programme has received a boost from the African Development Bank through a US$40 million budget support loan to be provided by the African Development Fund, the concessional arm of the Bank Group.
The budget support facility is being managed under the African Development Bank’s Good Governance and Private Sector Development Program (GGPSDP).
The first phase of the GGPSDP reinforces Tanzania’s Blueprint for Regulatory Reforms to Improve the Business Environment and forms part of the US$80 million two-year programmatic budget support for the East African nation, covering the fiscal year 2017/18 and 2018/19.
Specifically, the programme promotes the country’s transition towards inclusive and resilient private sector-led economic growth agenda, backed by improved economic and financial governance.
In approving this budget support loan, the board of directors of the African Development Bank appraised Tanzania’s economic management and considered ongoing efforts to achieve public sector budget credibility, macroeconomic stability, a condusive climate for private sector development and an effective procurement systems and audit services.
The African Development Bank’s intervention will enhance the viability of Private, Public-Sector Partnerships and support improvements in the institutional, legal and regulatory framework for business operations in Tanzania.
It will also build on prior bank operations in the country, notably the Governance and Economic Competitiveness Support Programme, Power Sector Reforms and Governance Support Programme implemented during 2015-2017.
The programme complements the African Development Bank’s Institutional Support projects for Good Governance and the Domestic Resources Mobilization and Natural Resources Governance project.
“Tanzania’s economic reform program is on course and the country is committed to strengthening competitiveness and development of the private sector,” comments Soraya Mellali, African Development Bank executive director for Algeria, Guinea and Madagascar.
“The budget support loan would further aid this process,” adds Mellali.
The funding is aligned to pillar II of the African Development Bank’s Tanzania Country Strategy Paper, Strengthening Governance and Accountability, and two of the five operational priorities of the Bank Group’s Ten-Year Strategy.
It also supports the core priorities of the Bank’s Governance Strategic Framework and Action Plan and the Private Sector Development Strategy for Tanzania.
It is consistent with two of the Bank’s High 5 priorities: “Industrialise Africa” and “Improve the quality of life of the people of Africa.”