China lends Tanzania $7.6bn for its coveted new rail system

Tanzania’s long-anticipated rail renewal took a step closer this week when it secured a $7.6bn loan from China’s Export-Import Bank (Exim) to build a railway network linking the coastal metropolis of Dar es Salaam to the African nation’s landlocked neighbours.

President John Magufuli thanked the Exim bank in a statement announcing the deal on 20 July, and said construction would begin this year.

The standard gauge railway is expected to improve regional trade and boost the economies of Tanzania and its inland neighbours Uganda, Rwanda, Burundi and the Democratic Republic of the Congo (DRC).

President Magufuli as been impatient for work on the 2,000-km-plus railway to start after a consortium of Chinese firms was last year awarded the contract to build it.

In April this year he pressed the Chinese government to begin building as soon as possible.

The Exim bank was a "reasonable borrower" and the loan was offered on "reasonable terms", Magufuli said in his statement this week.

Reuters Africa commented on the news, saying that Tanzania wants to "profit from its long coastline and upgrade its rickety railways and roads to serve growing economies in the landlocked heart of Africa."

Reuters added that natural gas discoveries in Tanzania and oil finds in Kenya and Uganda have turned East Africa into an exploration hotspot, but that the countries suffered from neglected transport infrastructure.

Image: Children at the Tazara train station in Dar es Salaam, Tanzania (David Brossard/Wikimedia Commons)

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