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Press Release

MCC Provides Funding to Tanzania to Develop Compact Focused on the Power Sector

For Immediate Release

November 15, 2014

DAR ES SALAAM – The United States Government, through the Millennium Challenge Corporation (MCC), agreed to provide up to $9.78 million for the development of high-impact investment projects in Tanzania’s energy sector. 

United States Ambassador Mark B. Childress presided over the signing of the grant agreement at the Ministry of Finance in Dar es Salaam. The agreement was signed by MCC Vice President of Compact Operations Kamran Khan and Tanzanian Minister of Finance Saada Mkuya Salum. 

The grant agreement builds on a history of a strong partnership between the United States and Tanzania. Between 2008-2013, MCC implemented a compact of investment projects in water, roads, and electric power throughout Tanzania, totaling $698 million. That compact program led to the construction of over 3,000 kilometers of power lines, 450 kilometers of trunk roads, two water treatment plants and an airport runway.

Given its successful implementation of that first compact program–the largest in MCC’s history–MCC's Board chose Tanzania eligible to develop a subsequent compact. The focus of this compact will likely be the power sector, including investments in infrastructure as well as policy, regulatory and institutional reforms. Through the grant agreement signed today, Tanzania will mobilize consultants to undertake detailed feasibility studies and other preparatory work on project ideas that are most likely to stimulate long-term economic growth. The studies will allow Tanzania to fully develop projects to reform the power sector; improve the technical, financial, and operational performance of the Tanzania Electricity Supply Company Ltd. (TANESCO) and the Zanzibar Electricity Corporation (ZECO); and expand access to electric power in rural areas of the country. 

This project development grant marks an important milestone in compact development. The grant also marks a significant commitment toward the goals of Power Africa, the U.S. Government initiative to double the number of people with access to power in Africa through collaboration with African governments, the private sector, and other development partners.