Tanzania – US$ 92 Million ADF Loans to Support Agriculture and Education Programmes

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Tunis, 5 September 2007 – The African Development Bank (AfDB) Group will support agriculture and education programmes in Tanzania following the approval of two loans on Wednesday in Tunis by the Board of Directors of the African Development Fund (ADF), the concessional window of the Bank Group.

The first loan of 40 million Units of Account (UA*), equivalent to US$ 61.25 million, will help finance Phase One of the country’s Agricultural Sector Development Programme (ASDP),  while the second loan of 20 million UA, equivalent to US$ 30.62 million will be used to fund the Secondary Education Plan (SEDP).

The objective of the ASDP is to provide farmers better access to agricultural knowledge, technologies, marketing systems and infrastructure, all of which contribute to higher productivity, profitability, and incomes, as well as promote private investment in the sector based on an improved regulatory and policy environment. The programme is expected to contribute to increased GDP growth, reduce rural poverty and enhance food security. 

The Programme comprises two (local and national) components with eight sub-components. The local component will support sector activities at the village, ward and district levels and will focus on three sub-components: agricultural investments, agricultural services, and agricultural capacity building and reform.

The national component will focus on five sub-components: Agricultural Services, National Irrigation Development and Marketing and Private Sector Development, Food Security as well as Coordination, Monitoring and Evaluation.

The programme will be implemented nationwide and all districts in the country will be eligible for assistance. Farmers will benefit directly from the programme as participants in specific programme financed activities (services and/or investments), as well as indirectly through improved efficiency of public service delivery at the local level. The total number of farm households targeted to benefit from agricultural services will be about 3 million by the end of the programme.

The overall cost of the Agricultural Sector Development Programme is estimated at UA 210.813 million (US$ 315.56 million). It will be financed with loans from the ADF, the government, beneficiaries and five other development agencies, including the World Bank.

With regard to the Secondary Education Development Plan, the objective is to contribute to increased access and improved quality and equity of secondary education in order to attain the national sector goal for education which is to ensure equitable access to quality primary and secondary education, universal literacy and expansion of higher, technical and vocational education. 

The SEDP will focus on improving access, equity and quality; management reform and devolution of authority, as well as the improvement of the education management system. It is expected to make considerable positive impact on poverty reduction, gender equity as well as in the reduction of the incidence of HIV/AIDS.

The total cost of the Plan is estimated at UA 754 million about US$ 1.2 billion. It will be financed by the ADF, the International Finance Association (IDA) as well as the government and local communities.

The Bank Group commenced operations in Tanzania in 1971. To date, the Bank has committed a total of UA 1.26 billion, about US$ 1.9 billion, in 104 operations in the country. The AfDB is among Tanzania’s top four major development partners.

* UA 1 = US$ 1.53122 = TZS 1903.89 as at 5 September 2007