Closed Compact Report: Tanzania Compact | November 2015

Compact Changes

The Tanzania Compact included large-scale capital investments in roads, water, and electricity . Because MCC compacts are a fixed amount implemented over five years, partner governments must focus on the compact results while balancing changes in costs, speed of implementation and environmental considerations. During the Tanzania Compact, MCC and the government made mutually agreed-upon adjustments to compact targets, including:

  • In December 2009, MCC and the government reallocated $39.6 million from the eight-megawatt Malagarasi Hydropower Activity following a final environmental analysis of the proposed worksite. The analysis uncovered a study that reported the discovery of several new and highly endemic aquatic species on the site, and concluded that the activity would create a significant environmental hazard even with mitigation measures. Approximately $4.8 million was reallocated to the Zanzibar Interconnector Activity, $34.4 million was moved to the Distribution Systems Rehabilitation and Transmission Activity, and $400,000 was used for additional environmental and social activities. The remaining funds in the activity were used for the rehabilitation of the Kigoma electricity distribution system and a pilot off-grid solarprogram in two districts of the Kigoma region.
  • In June 2010, the $32 million Non-Revenue Water Activity was re-scoped after the final design estimates on two of the activity’s infrastructure investments indicated higher costs that would significantly impact their economic rates of return. As a result, $13.2 million was reallocated to the Lower Ruvu Plant Expansion Activity, $9.6 million to the Morogoro Water Supply Activity, and $400,000 for other environmental and social activities.
  • The Transport Sector Project faced significant cost increases and schedule changes identified through further technical design and resettlement work that took place post-compact signing. Therefore, the government committed to providing approximately $132 million to complete all planned activities in the compact. Reallocations from other compact activities also supplemented the Transport Sector Project.