REGIONAL RUSUMO FALLS HYDROPOWER PROJECT TANZANIA - TRANSMISSION COMPONENT Dar es Salaam, Tanzania, 11 February 2014 Signing of the

Loan Agreement Statement by Dr. Tonia Kandiero, Resident Representative Tanzania Country Office *******

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The African Development Bank would like to express sincere appreciation to the Government of the United Republic of Tanzania for the excellent partnership and collaboration with the Bank Group. TheTransmission Line and associated Substation Component of the Regional Rusumo Falls Hydropower Project (with Burundi and Rwanda) that was signed today is a further testimony of the commitment to working together to support Tanzanians development aspirations. The Bank has been engaged with this project as far back as 2006, providing an African Development Fund Grant of USD 4 million (UA 2.57 million) to the Nile Basin Initiative to finance the technical, financial, economic and social feasibility studies for the transmission lines of the Regional Rusumo Falls Hydropower Plant. This project represents a significant milestone for the countries involved and for crossborder cooperation within the Nile Basin Initiative Countries. The Banks financing for the Rusumo Hydropower Project is a direct response to the Governments National Development Vision 2025, National Strategy for Growth and Reduction of Poverty II and the updated Power System Master Plan for the next 25 years (2010 2035). The Banks support through the Rusumo Hydro Project comprises of loan of USD 33.814 million. The overarching goal of this project is to contribute to the Governments energy sector development objectives by supporting increased energy generation capacity and enabling the expansion of electricity access rate.
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The Transmission Line Component, in Tanzania, will finance the following: (i) construction of 98.2 km of 220 kV, double circuit transmission line system , from power plant to new Nyakanazi substation; (ii) (iii) construction of 220/33 kV Nyakanazi substation; and Project supervision and management as well project audit.

The Banks support through the Rusumo Project will directly contribute to Tanzanias objective of economic transformation through growth for reduction of income poverty. It will also help to increase the countrys renewable electricity supply capacity to address the power deficit and to allow the expansion of energy access rate. The project beneficiaries will include households, industries, small and medium sized enterprises and businesses who will gain access to cheaper, more reliable and sustainable electricity. In addition, the country will benefit from having the opportunity to replace high cost thermal plants from the power systems, thereby lowering the cost of power generation. The total cost of the Tanzania Transmission Line component under Rusumo Project is US$ 35.358 million (UA 23.431 million) and the Banks financing will be used to cover 95.6% of this total cost or US$ 33.814 million (UA 22.408 million) with the balance being covered by the government.

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The agreement which was today will increase the African Development Banks cumulative net commitment in Tanzania to about US$ 1.6 billion, covering such key sectors as agriculture, transport, energy, water supply/sanitation as well as job creation and entrepreneurship development. Going forward, as the Government sets out to implement the Vision 2025 and National Strategy for Growth and Reduction of Poverty NSGRP-II in earnest, the African Development Bank will remain a privileged and trusted partner providing the necessary support, including engagement in policy dialogue on reforms required to achieve the countrys development aspirations. The Bank also wishes to acknowledge the dedication and contribution of staff from the Ministry of Finance, Ministry of Energy and Minerals, TANESCO and EWURA during the preparation of the Rusumo Falls Hydropower Project. In conclusion, the African Development Banks is ready to strengthen and deepen its longstanding support to Tanzanias development efforts. And, looks forward to working together in the implementation of this important regional project.

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