The Ministry of Finance of Tanzania has obtained a term loan of USD 1.46 billion to fund the construction of the Standard Gauge Railway (SGR) project from Dar es Salaam to Makutupora in central Tanzania.
Standard Chartered Bank Tanzania acted as a global coordinator of the loan while the biggest component of financing comes from the Export Credit Agencies of Denmark and Sweden.
The 550km long railway section is part of the overall SGR project that will stretch for 1,219 km, connecting Dar es Salaam to Mwanza on Lake Victoria for an overall budget of USD 7.5 billion, providing a safe and reliable means for efficiently transporting people and cargo to and from the existing Dar es Salaam Port.
It will also connect Tanzania to Burundi, Rwanda and The Democratic Republic of Congo (DRC), thereby playing a key role in enhancing regional trade.
The SGR, currently under construction, is intended to replace the old, inefficient meter-gauge railway system. The foundation stone for the construction of the first section of the SGR connecting Dar es Salaam to Morogoro was set in April 2017.
Railway transport is the second most important mode of transport after road and critical for long-distance freight along the main transport corridors in Tanzania.
The Tanzanian rail network comprised two main railways: the Tanzania Railways Corporation (TRC) network of 2,600 km and the Tanzania-Zambia Railway Authority (TAZARA) of 1,067 km, connecting Dar es Salaam with Kapiri Mposhi in Zambia.