PM refutes reports on stalled donor funds

Prime Minister, Mizengo Pinda

The Prime Minister, Mizengo Pinda has refuted reports that Tegeta escrow  account scam had stalled the implementation of the 2014/2015 budget because key development partners had withdrawn USD 558 million budget support to Tanzania.

 

The premier was responding to a question from Kigoma-South MP, David Kafulila (NCCR-Mageuzi). 

 

The MP had asserted that development projects had been stalled in the country because development partners had withheld the funds.

 

The Prime Minister pointed out that for nearly four years “donors had not been fulfilling their development assistance  to Tanzania  as promised.”

 “For the last three to four years the donors had not been fulfilling their development assistance to Tanzania, adding it is now time the government found new sources of revenue for the country’s socio-economic development”, he said.However, Kafulila said for the last six months, the US had not signed the five year compact as a result many  development projects had been stalled.

He wondered as to why the government had not issued statement in the National Assembly towards the matter.

 

He  pointed out that the government had continued paying IPTL a whopping USD2.6million (about 5bn/-) a month amid evidence from the CAG reports and International Centre for Settlement of Investment Disputes---ICSID.

In May last year, at least twelve donor countries including multilateral companies instituted stringent conditions to the government until it first sort out Independent Power Tanzania Limited (IPTL) issues.

 

Later, the US government also announced to  hold the signing of the Millennium Challenge Corporation (MCC) compact with Tanzania pending the government’s action on the Tegeta escrow scandal.

The value in the MCC facility was pegged at around USD700 million in five years from 2015.

 

The Permanent Secretary in the Ministry of Finance, Dr Servacius Likwelile conceded at a summit with development partners in US that development partners were demanding Tanzania to first sort out Independent Power Tanzania Limited (IPTL) issues before they provide funds for the implementation of the government budget.

 

He said support from the global financial institution had brought about economic improvements in the country. “However, regardless of economic improvements there has been a problem that is failing our budget implementation.

 

“And this comes as a result of donors demands that issues related IPTL to be resolved first…this IPTL issue was never in our agreements,” the Paymaster General said in Washington.

 

SOURCE: THE GUARDIAN