Tanzania - Second Supplemental Credit to the Lake Victoria Environmental Management Project

Page 1 PROJECT INFORMATION DOCUMENT (PID) APPRAISAL STAGE Report No.: AB1047 Project Name Lake Victoria Environmental Management Project Region AFRICA Sector General agriculture, fishing and forestry sector (40%); Ports, waterways and shipping (20%); General water, sanitation and flood protection sector (20%); Agricultural marketing and trade (20%) Project ID P090680 Borrower(s) REPUBLIC OF TANZANIA Implementing Agency Environment Category [ ] A [X] B [ ] C [ ] FI [ ] TBD (to be determined) Safeguard Classification [ ] S 1 [X ] S 2 [] S 3 [ ] S F [ ] TBD (to be determined) Date PID Prepared August 5, 2004 Date of Appraisal Authorization August 26, 2004 Date of Board Approval October 21, 2004 1. Country and Sector Background Tanzania is one of the poorest countries of the world. Per capita income is estimated at about $290 per year. Covering an area of 945,000 square kilometers (i.e. larger than Kenya and Uganda combined), it has a population of about 35 million which is growing at about 3 percent a year. The economy is heavily dependent on agriculture (primarily coffee, cotton, tea, cashew nuts, sisal, maize, rice, wheat, cassava, tobacco, and fish), which accounts for about 45 percent of GDP, provides 80 percent of exports, and is by far the largest employer. From 2000 to 2004, agricultural growth has been within a range of 3.5 to 5.5 percent annually. Industry accounts for some 15 percent of GDP and is mainly limited to processing agricultural products and light consumer goods. The mining sector has good potential and is being developed in part with Foreign Direct Investment such as from South Africa. A Country Assistance Strategy (CAS) for Tanzania was approved by the Bank