Tanzania plans to spend 42.9 trillion shillings over the next five years to finance development projects aimed at boosting economic growth in the country, said a government minister.
Stephen Wassira, minister of state in the president’s office, told parliament the government would come up with 13.5 trillion shillings while the rest of the funds would be provided by domestic and foreign sources.
“The government needs to spend an average of 8.5 trillion shillings a year in order to implement the new five-year development plan (2011/12-2015/16),” he said when presenting the government’s mid-term plan, Reuters reports.
“We have to ensure that at least 35 percent of the government’s budget is allocated for development projects.”
He said the development plan launched by President Jakaya Kikwete on June 7 will target average economic growth of 8-10 percent annually over the next five years by focusing public and private investments on infrastructure, agriculture and industrial sectors. Growth in 2010 was seven percent.
“Our aim is to reduce donor dependency in the government’s budget to just 10 percent,” he said.
Tanzania is among the continent’s biggest per capita aid recipients and is expected to fund almost 29 percent of its 2011/12 budget spending with the help of donors.
The minister did not make any mention of a proposal in the development plan to introduce a “super profit” tax on earnings from minerals.
Tanzania’s Energy and Minerals Minister, William Ngeleja, told Reuters on Sunday the country will not impose the proposed super profit tax on existing mining companies, but would negotiate with the companies to have them pay the new tax.
Tanzania is Africa’s fourth largest gold producer, but also has reserves of uranium, nickel and coal.
African Barrick Gold has four gold mines in Tanzania while Australia’s third largest gold miner, Resolute Mining, and South Africa’s AngloGold Ashanti also have gold operations there.
Gold exports in 2010 rose by 19.3 percent to $1.46 billion, largely due to a rise in gold prices on the world market.