TANZANIA – Trade and Development Bank (TDB), a trade and development financial institution in Africa, has approved a US$1 billion soft loan to Tanzania for implementation of various infrastructure projects, said a statement issued by the presidency.

The statement issued by the Directorate of Presidential Communication at Chamwino State House in the capital Dodoma said the release of the loan was announced by the TDB President and Chief Executive Officer Admassu Tadesse during talks with President John Magufuli.

East Africa’s second largest economy wants to profit from its long coastline and upgrade rickety railways and roads to serve growing economies in the wider East and Central Africa region.

Tadesse told President Magufuli that the bank was also in final arrangements of approving another soft loan amounting to 500 million dollars for supporting implementation of development projects in the east African nation, said the statement.

The government said in 2016 it had agreed a US$7.6 billion loan from China’s Export-Import Bank (Exim) to build a railway line that will link it to neighbours, but the funds were never disbursed. No reasons were given by authorities.

Admassu Tadesse, TDB’s chief executive, said the bank was in discussion with the Tanzanian government for additional loans worth “hundreds of millions of dollars” to finance infrastructure projects, including a new railway.

“We underwrote US$500 million of that US$1 billion and the other US$500 million was mobilised and raised through some of our partners,” said Tadesse after meeting Tanzania’s president.

“There is more on the table right now. We’ll be putting in several hundred million going forward.”

In total, Tanzania wants to spend US$14.2 billion over the next five years to build a 2,561 km (1,591 mile) standard gauge railway network connecting its main Indian Ocean port of Dar es Salaam to its hinterland.

Tadesse said the high-speed electric rail network that Tanzania is building is expected to boost trade with landlocked neighbours in the region.

President Magufuli thanked TDB for approving the soft loans to Tanzania and appealed to the bank for more loans that will help the country to implement flagship projects, including the standard gauge railway and a hydropower project in Ruhuji River in Njombe region.

Reacting to President Magufuli’s request, Tadesse said the bank will approve more soft loans to Tanzania for the execution of the standard gauge railway project from Dodoma to the western and northwestern parts of the country, connecting landlocked neighbouring countries.

He commended Magufuli for overseeing massive economic transformation in the country.

The TDB institution is owned by regional states and other shareholders. It is a U.S. national bank and subsidiary of the Canadian multinational Toronto-Dominion Bank.

The Toronto-Dominion Bank is a Canadian multinational banking and financial services corporation headquartered in Toronto, Ontario.