The Tazara railway, built by the Chinese in the 1970s (Jossejonathan/Creative Commons)

Tanzania courts Turkey for its rail megaproject, casting doubt on China’s role

24 January 2017 | By GCR staff 0 Comments

Confusion descended on Tanzania’s stalled plan to build a multi-billion-dollar standard gauge railway across its breadth from the port of Dar es Salaam to neighbours inland after it was revealed that its government is courting a Turkish firm and Turkish cash to build part of the line.

This unexpected development throws a $7.6bn loan agreed with China’s Export Import Bank last year into doubt because, when China lends money for infrastructure, Chinese firms get the work building it.

That pattern looked set to be repeated when, anticipating Chinese financing, Tanzania awarded contracts worth $9bn to a consortium of Chinese firms led by China Railway Materials in the middle of 2015. But those contracts were terminated over irregularities last year, with only 5km of line having been built, after President John Magafuli assumed office in November 2015.

The revelations came today amid a flurry of diplomatic activity this week between Tanzania and Turkey, following high-level visits by Chinese officials to Tanzania earlier this month.

On the heels of a two-day state visit to Tanzania by Turkish President Recep Erdogan, which ended 23 January, Tanzanian newspaper The Daily News reports President Magufuli as saying that an unnamed Turkish company was among a number shortlisted for work on the 2,000-plus-km railway.

Magafuli also asked Erdogan for a Turkish loan to finance a 400km stretch of the track, Daily News reports, and received in return a pledge from Erdogan that Turkey’s finance minister would “work on it”.

The government of Tanzania has allocated $500m of its own money in its current budget to fund the scheme.

This could strain relations with China. According to a report in Kenya’s East African website, Wangi Yi, China’s foreign minister, visited Tanzania two weeks ago to discuss the tender, but officials were said to have offered no guarantees that a Chinese contractor would win the competition.

Zitto Kabwe, the leader of the opposition in Tanzania, told East African that the early indications were that a Turkish company was likely to win the work, and that the Chinese government was threatening to pull out of the project.

He said: “The project has put the government relationship with China at a crossroads, and it is clear President Magufuli is determined to proceed with it even if China doesn’t provide funding. The question is where the money to build such a massive project will come from.”

Tanzania’s standard gauge line will cover around 2,190km from Dar es Salaam to Isaka in the north of the country, then to Burundi, Rwanda and the Democratic Republic of Congo; about 1,200km of the network is inside Tanzania.

Image: The Tazara railway, built by the Chinese in the 1970s (Jossejonathan/Creative Commons)

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