Announcement of World Bank Lends Fifteen Million US Dollars to Tanzania for Textile Production on June 5, 1975

• 1818 H STREET, N.W .. WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 Bank News Release No. 75/50 June 5, 1975 WORLD BANK LENDS $15 MILLION TO TANZANIA FOR TEXTILE PRODUCTION The World Bank today approved a loan of $15 million to help finance increased texU, · 1;>roduction in Tanzania. The loan will be made in conjunction with a $15 million loan by the Kuwait Fund for Arab Economic Development. Under the project, production at the Mwanza Textiles Limited plant in North-west Tanzania will be expanded from about 23 to 43 million meters of printed cotton fabrics a year 11 providing additional employment for 1,200 people. With additional minor expansion in other textile plants in Tanzania, • the project will almost eliminate Tanzania's need for cotton fabric imports by 1980. The textile industry already ranks first in the Tanzanian manufacturing sector, having achieved 65% national self··sufficiency in 1974. The Mwanza project includes a $100,000 training program for specialist op~rators. It will also help finance a feasibility study for a textile project for cotton/man-made fiber blend fabrics, and a review of the export possibilities for Tanzanian textiles. The project is consistent with the Tanzanian Government's industrial strategy for the processing of locally-produced raw materials. The World Bank Group is currently financing projects for cashewnut and meat processing in support of the program. The Bank loan is for 22 years at 8.5% interest per annum, with five • years' grace • Note: Money figures are expressed in US dollar equivalents. - 0 -  T E CHNI CAL DAT A PROJECT: COUNTRY: Textile product1-on Tanzania • TOTAL COST: $44. 3 million BANK FINANCING: $15 million; 22 years, w::i.th fi.ve years' grace, at 8~5%. OTHER FINANCING: $15 million loan by the Kuwait Fund for Arab Economic Development. IMPLEMENTING ORGANIZATION: Saigol Brothers Ltd. (Pakistan) as engineering fi nn in consultation with Mwanza Textiles Ltd. (MTL), and the National Tr!xtile Corporation. PROJECT DESCRIPTION: Expansion of the existing cotton textile mill at Mw~za to produce an additional 20 million meters of cotton fabrics per year, bringing total production of MTL to 43 mi.llion meters. The project also provides for a feasibility study of a cotton blend unit and an inves ti ga- tion into the export potential for Tanzanian textiles. • PROCUREMENT: For items financed by the Bank, international competitive bidding in,accordance with Bank's procurement guidelines, except: small items costing less than $50,000 may be purchased through international shopping after approval by Bank of list of items; proprietary equipment necessary for efficient plant operation and items critical to timely completion of project estimated to cost not more than $2 million to be procured following bidding from restricted lists of qualified suppliers with prior approval of the Bank. Retroactive financing from April 1, 1975 for engineering and consultant contracts up to an amount of $150,000. Items financed by the Kuwait Fund are to be procured internationally in accordance with its procurement guidelines. CONSULTANTS: Gherzi Textil Organisation (Switzerland) will be employed as technical adviser. ECONOMIC RATE OF RETURN: ESTIMATED COMPLETION DATE: 16%. 1978. - 0 - •