Every time the Standard Gauge Railway (SGR) slices across Tanzania’s plains, it draws admiration, sleek, modern, and promising. It symbolizes ambition, sovereignty, and a bold leap into the future. But for all its speed and spectacle, the railway carries with it a quieter, more complex weight: debt.
The SGR was never just a train line. It was a statement. Yet behind that statement lies a financing model shrouded in opacity. While leaders speak proudly of national milestones, few Tanzanians can explain how, or at what cost, this project was funded. In the absence of clarity, speculation fills the gap. And in public finance, speculation often signals danger.
This article explores the murky terrain of infrastructure financing in Tanzania, not to deny progress, but to ask what kind of future we’re financing, and who bears its cost.
The Financing Maze, Unpacking the SGR’s Debt Sources
Ask ten people how Tanzania paid for the SGR, and you’ll get ten answers. Some believe it was fully funded from domestic revenue. Others mention foreign contractors, loans from unnamed partners, or partial support from export credit agencies. The fact that these views persist, without any shared, confirmed baseline, speaks volumes.
There has never been a public, detailed breakdown of the SGR’s financing. No official document has clearly outlined the debt components, the grant portions (if any), interest rates, grace periods, or repayment schedules. The identity of key financiers, whether Chinese institutions, Turkish banks, or domestic bond markets, remains unclear.
What is clear is this: Tanzania undertook one of its most significant infrastructure projects in history, yet the funding trail remains largely invisible to the public.
This lack of transparency is not simply a technical gap, it erodes trust. Without clarity, it becomes impossible to assess whether the country negotiated favorable terms, leveraged competitive bidding, or exposed itself to undue financial risk.
Rhetoric vs. Reality: “Own Resources” and the Illusion of Self-Reliance
Government messaging has repeatedly emphasized that the SGR, especially its initial phases, was financed through “own resources.” It’s a phrase that suggests strength and self-reliance, but also one that invites scrutiny.
What does “own resources” mean in practical terms? Does it refer to tax revenue, diverted sectoral budgets, or borrowing from domestic financial institutions? Without disaggregated data, this claim risks becoming rhetorical cover for less palatable trade-offs, including reduced funding for education, healthcare, or other vital sectors.
The portrayal of self-funding often ignores how budget priorities shift in quiet, opaque ways. Even if no external loans were used for a specific phase, the redirection of funds from development programs into capital projects represents a choice, and that choice deserves public discussion.
Pride in self-financing must not obscure the need for scrutiny. When public officials celebrate infrastructure without revealing its financial architecture, they blur the line between sovereignty and silence. The result is a feel-good story that avoids hard questions.
The Intergenerational Debt Question: Who Bears the Burden?
Every public debt is a decision about the future. It asks tomorrow’s citizens to pay for today’s choices. With a project as significant and long-term as the SGR, the question isn’t just whether it’s necessary, it’s whether it’s just.
Tanzania’s investment in the SGR was framed as a strategic leap. But with limited information on loan terms, revenue projections, and expected returns, it’s difficult to determine whether future generations will inherit an engine of growth or a drag on public finances.
There are serious concerns that the financial model assumes optimistic cargo volumes that may not materialize. If operational costs outstrip revenues, repayment obligations could fall back on the government, leading to tighter budgets, higher domestic borrowing, or deferred investments elsewhere.
Intergenerational equity is not a footnote. It should be a central consideration in all infrastructure planning. A railway may last decades, but so do its financial consequences.
Value for Money? Contracting, Cost Per Km, and Public Scrutiny
One of the most striking omissions in Tanzania’s infrastructure discourse is a robust public conversation about value for money. Beyond the feel-good headlines of completion and connectivity, a simple question lingers: Did the country pay a fair price for what it built?
Available information on the cost-per-kilometer for the SGR is sparse and inconsistent. There is little accessible benchmarking against similar projects in the region. More importantly, procurement details, including contractor selection, change orders, and variation costs, have not been made public.
In the absence of independent audits or parliamentary reviews, concerns about cost inflation and underperformance remain unanswered. For a flagship project of this scale, the silence is deafening.
Value for money is not just about how much was spent. It’s about whether the infrastructure delivers economic and social returns proportional to its cost, and whether there was adequate oversight in spending that money.
Towards a Transparent Fiscal Infrastructure Model
It’s not too late to shift course. Tanzania can, and should, pioneer a new model of fiscal transparency in infrastructure.
Such a model would include:
- Public disclosure of all loan agreements for strategic projects.
- Regular debt service updates tied to specific infrastructure investments.
- Independent value-for-money audits published in full.
- A single digital portal that tracks project timelines, financiers, and disbursements.
- A citizen feedback mechanism for large capital investments.
Transparency is not a luxury. It is the foundation of trust. And in a country where infrastructure is often politicized, depoliticizing the numbers may be the only way to protect the project’s long-term legitimacy.
What Future Are We Financing?
The Standard Gauge Railway is not just a track laid across Tanzania’s soil; it is a path chosen. A path paved with financial decisions, political narratives, and long-term commitments whose implications many citizens are not yet fully aware of.
Its ambition is undeniable. But so too is the silence surrounding its true cost. Without transparency, even the best-intentioned projects risk eroding the public trust they were meant to build. Infrastructure becomes spectacle; investment becomes myth.
The future Tanzania that is being built must be more than visible. It must be honest. It must be accountable. A nation does not mature simply by laying concrete; it matures by opening its books, owning its choices, and inviting scrutiny, not as an attack, but as a civic necessity.
The question was never whether Tanzania should invest in rail; it was whether it would do so wisely, transparently, and justly. That question still stands. And it deserves an answer.
Read more articles by Dr. Wilson Pesabelele
Nice article that rises emotions