Announcement of Six Million US Dollars to Help Finance a Development Finance Company Project in Tanzania on February 7, 1974

INTERNATIONAL DEVELOPMENT ASSOCIATION 1818 H STREET, N.W., WASHINGTON D. C, 20433 TELEPHONE: EXECUTIVE 3-6360 IDA Press Release No. 74/9 Subject: $6.0 million to help finance February 7, 1974 a Development Finance Company project in Tanzania The International Development Association (IDA), an affiliate of the World Bank, has approved a credit of $6.0 million to the Government of Tanzania to help finance a Development Finance Company Project. The proceeds of the IDA credit are to be relent to the Tanzania Investment Bank (TIB). Tanzania's manufacturing sector accounts for a comparatively small part of the economy but nevertheless is increasing in importance. Pros- pects for growth In the industrial sector are considered strongest in the local processing of agricultural products for both export and domestic consumption. The present project is to provide funds to assist TIB to finance specific development projiects through loans and investments for productive enterprises. It will be the first Bank Group operation for a Development Finance Company financing primarily public owned enterprises. TIB is a well staffed and financially sound institution. Its operations have in- creased rapidly since it was established in November 1970, and it is now the largest medium and long-term financing institution for industry in the country. The IDA credit is being made to the United Republic of Tanzania for a term of 50 years including 10 years of grace. It is interest-free but will carry a service charge of 3/4 of 1% to cover IDA's administrative expense. The proceeds of the credit will be relent to the TIB at 7-1/4% interest per year on the outstanding balance with a small commitment charge on amounts not withdrawn. Note: Money figures are expressed in US dollar equivalents.