Announcement of Tanzania Representative Signs Credit Agreement for Poverty Reduction Support on September 22, 2005

Tanzania Representative Signs Credit Agreement For Poverty Reduction Support Media Contact: In Washington: Herbert Boh (202) 473 3548 hboh@worldbank.org Beldina Auma (202) 458 7307 baumaowuor@worldbank.org Washington, DC, September 22, 2005 – The Permanent Secretary of the Treasury, Gray Mgonja, today signed, on behalf of the Government of Tanzania, the credit agreement for Tanzania’s third Poverty Reduction Support Credit (PRSC-III). Judy O’Connor, the World Bank’s Country Director for Tanzania and Uganda, signed on behalf of the World Bank. The US$150 million credit* will provide direct budget support for the implementation of key elements of Tanzania’s National Strategy for Growth and Poverty Reduction (MKUKUTA). The credit was approved by the World Bank’s Board of Executive Directors on September 8, 2005. Mgonja highlighted Tanzania's continued strong economic performance and progress in the areas of education, health, and water, indicating that progress in these areas has been greatly facilitated by the Bank's support through the PRSCs. “The Government is committed to continued reforms, with increased focus on agriculture, which directly affects the livelihood of the poor in Tanzania,” Mgonja emphasized. PRSC-III will support reforms to improve economic governance, enhance public service delivery, and create an enabling environment for private sector activities. “The World Bank is committed to supporting Tanzania's poverty reduction strategy in ways that support Tanzanian ownership of the reform process and full alignment of the Bank's PRSC support with Tanzania's budget," O’Connor said. The credit will fund measures to build capacity within the public sector to implement poverty reduction programs in the priority sectors including primary education, basic health, the judiciary, agricultural research and training, and rural infrastructure. Reforms are expected to significantly impact agriculture and rural development focusing on raising agricultural productivity and enhancing the incomes of rural dwellers, where poverty is most widespread and most deeply entrenched. * The credit is on standard International Development Association (IDA) terms, with a commitment fee of 0.35 percent and a service charge of 0.75 percent. The credit’s period of maturity is 40 years, including a 10-year period of grace. For more information on the World Bank’s work in Africa visit: http://www.worldbank.org/afr/ For more information on the World Bank’s work in Tanzania visit: www.worldbank.org/tanzania For Tanzania’s PRSC-III press release on the credit approval from the Bank visit: http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/AFRICAEXT/0,,contentMDK:20642005~menuPK:258649~pagePK:146736~piPK:146830~theSitePK:258644,00.html For the third Tanzania Poverty Reduction Support Credit documents visit: http://web.worldbank.org/external/default/main? pagePK=64027221&piPK=64027220&theSitePK=258799&menuPK=287369&Projectid=P087256 For the Tanzania Poverty Reduction Strategy Paper visit: http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/AFRICAEXT/TANZANIAEXTN/0,,contentMDK:20127781~pagePK:1497618~piPK:217854~theSitePK:258799,00.html