$500 million (about Sh800 billion) to rescue TANESCO

$500 million (about Sh800 billion) to rescue TANESCO

By Mbarouk Matata,

St.Augustine University o f Tanzania,

B.A. Economics 2013

The government has set aside $500 million (about Sh800 billion) to rescue the Tanzania Electric Supply Company Limited (TANESCO) from debt as well as improve its operations and services.

The minister for Energy and Minerals, Prof Sospeter Muhongo, told Parliament at the weekend that the government has big plans to revive the organisation to make it active in fulfilling national interests.

He said the organisation was performing poorly at the moment because of a big debt burden, poor infrastructure and lack of funds.

“We admit that the organisation is not performing well...but we have many plans to revive it and make it active again. We have already set aside $500 million to help the organisation to get to its feet again as well as implement its projects effectively,” said Prof Muhongo.

The minister was speaking during the winding-up of his ministry’s 2013/2014 budget estimates. The budget was tabled last week (May 22) but could not be endorsed after the outbreak of violence in Mtwara Region.

It was established that the violence started after the minister finished reading his ministry’s budget estimates in the House in which he insisted that the gas pipeline project linking Mtwara and Dar es Salaam would go ahead.

According to Prof Muhongo, it is not easy to revive Tanesco and improve the energy sector in the country since the process needs money and expertise.

He said his office has already requested for a $300 million (about Sh480 billion) loan from the World Bank and $200 million (about Sh320 billion) loan from the African Development Bank (AFDB).

“We have asked for this money with the aim of transforming Tanesco and change its face completely... we want the organisation to operate and provide high quality services,” said the minister.

He said the organisation’s board of directors would present its report to him in June, this year, that would explain how they want the power utility to look like as a part of the transformation.

“This process is participatory...we have involved various stakeholders. As I am speaking now, the Tanesco’s board of directors will present the report to me in June... I asked them to explain what they need and which changes should be made to transform the organisation,” said Professor Muhongo.

He said the organisation would change for the better and its services made reliable and of high quality.