Announcement of Twelve Million Dollars IDA Credit for Urban Development in Tanzania on July 11, 1977

eWorldBank ·1a18 H Street, N.W., Washington, D.C. 20433, U.S.A. • Telephone: (202} 393-6360 I DA NEWS RELEASE NO. 78/3 July 11, 1977 $12 MILLION IDA CREDIT FOR URBAN DEVELOPMENT IN TANZANIA More than 315,000 low-income urban dwellers in Tanzania will benefit directly from an urban development project being supported by a $12 million credit announced today by the International Development Association (IDA), an affiliate of the World Bank. The credit will help finance the Seco~d National Sites and Services Project of the Government of Tanzania. The project will provide basic in- frastructure including water supply, drainage and roads, and community faci- lities for residents of squatter neighborhoods in five major towns in Tanzania. It also includes a program of surveyed plots for low income housing, house improvement and construction loans, provision of equipment and vehicles, technical assistance in numerous areas and an experimental program of assistance to small-scale industries. • The rapid growth of urban population is a world-wide phenomenon. It is particularly acute in developing countries. In T~nzania, for example, the population in urban centers is growing at an estimated average rate of 9% per annum. The results are a deteriorating employment situation and the proliferation of inadequately serviced squatter settlements with their attendant health and social problems. Between 40 and 70 percent of the residents of Tanzania's main cities live in such uncontrolled settlements. Efforts to improve the squatter neighborhoods were initiated by the Tanzanian Government in 1972 with the adoption of a National Sites and Services Program. Under the first project, approximately 160,000 low-income residents in Dar-es-Salaam, Mwanza and Mbeya benefitted ·through improvements in squatter areas and provision of basic infrastructural services and com- munity facilities. The new project will continue and improve upon the earlier one as well as expand the services to new neighborhoods in Dar-es- Salaam, Tanga, Tabora, lriuga, and Moragoro. A low-cost approach has been developed for this project so that the services provided can reach lower-income families. Its successful develop- ment is of potentially greater long-range significance since it could pro- vide replicable low-cost solutions to the rapidly growing urban squatter and unemployment problems in Tanzania and elsewhere. The $12 million IDA credit wil 1 pay 41% of the total cost of the new project. The Government of Tanzania and the Tanzania Housing Bank will cover the remaining cost. • The IDA credit to Tanzania is for 50 years, including 10 years of grace. It is interest free, except for a service charge of 3/4 of 1% to meet IDA's administrative expenses. NOTE: Money figures are expressed in U.S. dollar equivalents. FORM NO. 1121 (5-76) T EC HN I CAL D A T A PROJECT: COUNTRY:. TOTAL COST: Second National Sites and Services United Re pub) i c of Tanzania $29.3 mi 11 ion • IDA FINANCING: $12.0 mi 11 ion OTHER FINANCING: Tanzania Housing Bank - $12.6 mi111on Government of Tanzania - $4.7 million IMPLEMENTING ORGANIZATION: Ministry.of Lands, Housing and UTban Development (Ardhi) Dar-es-Salaam, Tanzania PROJECT DESCRIPTION: The project consists of provision of infrastructure services to areas including about 16,000 houses in existing squatter neighbourhoods, preparation of about 19,000 surveyed • plots in p1Jnned residential layouts, community facilities in the upgraded areas, house improvement and construction loans, an experimental program assisting the informal sector in two project towns, and provision for equipment/vehicles and technical assistance to support the various project components. PROCUREMENT: Infrastructure works totalling about $7.6 mill ion will be procured through international competitive bidding in accordance with the Bank 1 s Guidelines for Procurement. Local contractors will be accorded a preferential margin of 7.5% over foreign contractors in the evaluation of bids. Contracts for construction of community facilities totalling TSh 9.3million (US $1.1 million) and material purchases will be awarded in accordance with standard Government procedures in view of their small size and scattered locations. Because of the various items involved and small total size.equipment/vehicle purchases totalling US $0.4 mill ion will also be procured through standard Government procedures. CONSULTANTS: Consultancy services in project design and supervision is expected to cost a total of $0.8 mill ion. Outside of this category, the project includes about 249 additional man·months of consultancy services. They will be used for training of Tanzanian personnel in executing agencies, management support, project monitoring and evaluation, a study of Land Rent and Service Charge Act and preparation of a fol low-up project. ECONOMIC R~·- E OF RETURN: ESTIMATED COMPLETION DATE: 23% for upgrading and surv~y~d p1ot components. 1982 - 0 - •