Dar es Salaam. Tanzania is moving to remove institutional bottlenecks, streamline approvals and accelerate the implementation of public-private partnership (PPP) infrastructure projects as it seeks to attract more private capital for development.

Under the Third Five-Year Development Plan (FYDP III), covering 2021/22 to 2025/26, Tanzania identified an infrastructure investment requirement of Sh114.9 trillion, including Sh40.6 trillion expected from the private sector and Sh21.03 trillion through PPPs.

The ambition rises under the Fourth Five-Year Development Plan (FYDP IV), covering 2026/27 to 2030/31, which sets total infrastructure investment needs at Sh477 trillion.

About 70 percent, equivalent to Sh334 trillion, is expected to come from private capital.

The strategy is intended to supplement public financing, bridge infrastructure funding gaps and support Tanzania’s ambition of becoming a $1 trillion economy by 2050, while strategic public assets remain under state ownership.

Tanzania’s PPP Act (Cap 103 R.E. 2023) provides several instruments to support investment and manage project risks.

These include viability gap funding for economically important projects requiring financial support, state guarantees, minimum revenue guarantees, payment guarantees and letters of support.

The law also provides qualifying PPP projects with tax and non-tax incentives comparable to those available under the Tanzania Investment Act. 

It provides contractual protections and dispute-resolution mechanisms, including recourse to local courts and international arbitration.

According to Kafulila, Executive Director of the Public-Private Partnership Centre (PPPC) the developments were outlined during a work visit involving United Republic of Tanzania Cabinet ministers themed “Implementation of Public-Private Partnership (PPP) Programmes”.

Project pipeline

Speaking during the event, Mr Kafulila said Tanzania’s PPP portfolio covers energy, roads, railways, water, aviation and urban development at different stages, using models including Build-Operate-Transfer, Rehabilitate-Operate-Transfer and Operation and Maintenance.

In 2024, he said Tanzania reached financial close on two projects, securing $187 million in private investment.

“Among the largest projects in preparation is the $5 billion Lake Victoria-Dodoma Bulk Water Pipeline, which has a $25 million project preparation budget at the pre-feasibility stage,” he said.

Mr Kafulila said the project is intended to strengthen water supply to central regions.

In urban transport, the $2.5 billion Dar es Salaam Metro Rail, covering the Posta-Tegeta line, is undergoing revised feasibility studies supported by a $12.5 million preparation allocation, he said.

Mr Kafulila said the road and expressway pipeline includes the Kibaha-Mlandizi-Chalinze Expressway (Lot 1), a 78.9-kilometre corridor with estimated capital expenditure of $326 million under a 25-year concession and a $1.63 million preparation budget.

The Chalinze-Morogoro Expressway (Lot 2), covering 84.9 kilometres, he said is valued at $350 million under a 25-year concession and has a $1.75 million preparation allocation.

“Other roads under feasibility preparation include the $985 million Dar es Salaam Outer and Inner Ring Roads, with a $4.93 million preparation budget, and the $349 million Igawa-Tunduma Expressway, with $1.75 million allocated for preparation,” he said.

In the energy sector, he highlighted the $738 million Kikonge Hydropower and Dam project, with planned capacity of 321 megawatts and a $3.69 million preparation budget; the $634.5 million Rumakali Hydropower project, with 222MW capacity and $3.17 million for preparation; and the $597.1 million Mkuranga-Somanga-Lindi 400kV transmission line, with $2.99 million allocated for preparation.

Projects under execution

Mr Kafulila also highlighted projects that have reached the contracting and execution stages.

He named the largest single project as the $1.4 billion rehabilitation and operation of the Tanzania-Zambia Railway Authority (TAZARA) railway under a 32-year concession with CCECC.

In public safety and logistics, Tanzania Police Corp Sole has contracted VIGOR, SAMA and APPLUS under a 20-year, $116 million agreement to establish nine Motor Vehicle Inspection Centres.

Commercial urban developments include the $18 million Modern Logistics Hub Development involving the Tanzania Buildings Agency (TBA) and GALCO under a 30-year contract, and the $14.8 million DDC Kariakoo One Stop Business Complex, awarded by the Dar es Salaam Development Corporation (DDC) to Tosh Logistic Company under a 25-year term.

“At Julius Nyerere International Airport (JNIA), the Tanzania Airports Authority is concluding negotiations with Joban Group for a $45 million commercial complex and a $20.34 million four-star hotel at Terminal III, each under a 15-year term,” he said.

In the maritime sector, TAFICO is finalising a 10-year, $12 million operation and maintenance contract with NAHJ Capital Investment and Trade LLC for deep-sea fishing vessels, he said.

“Higher education infrastructure includes a $5.4 million, 30-year concession to construct student hostels for the College of Business Education (CBE) in Dar es Salaam,” he said.

“Local government authorities are preparing 17 priority community projects, with a combined preparation budget of $1.28 million, equivalent to $75,000 per project,” added Mr Kafulila.

Institutional capacity

According to Mr Kafulila, the expanding project pipeline is being supported by institutional and human-resource development.

As of March 2026, Tanzania ranked ninth globally and third in Africa, after South Africa and Nigeria, in the number of certified APMG PPP professionals, he said.

“The Public-Private Partnership Centre (PPPC) has conducted 36 capacity-building sessions, training more than 2,850 participants from 85 public and private institutions across 12 regions,” he said.

The PPP Facilitation Fund (PPPFF), established under Section 14 of the PPP Act and managed by the PPPC, supports project development, viability gap funding, capacity building and PPPC operations.

Mr Kafulila said its resources come from parliamentary appropriations, development partners and reimbursed project preparation costs paid by successful private developers after commercial close.

According to Mr Kafulila, Tanzania had moved from fragmented arrangements for private participation to a unified framework covering the full project lifecycle.

"Prior to establishing a dedicated PPP regime, projects involving private participation were executed in a fragmented manner across various government authorities," said Mr Kafulila.

"The introduction of unified policies, legislation, regulations, and institutional structures has established an integrated lifecycle, covering project identification, preparation, appraisal, procurement, execution, and contract management. This modern framework guarantees transparency, accountability, financial value, and appropriate risk transfer,” he added.

He said the immediate priority was to turn projects in the pipeline into financial closes and physical construction.

"Our immediate strategic imperative is to translate this well-structured project pipeline into completed financial closes and active, on-the-ground infrastructure construction," noted Mr Kafulila.

"By approving dedicated preparation funding, streamlining decision-making mandates, and holding institutional leaders accountable through mandatory KPIs, we will unlock billions of dollars in private capital, achieve our FYDP IV objectives, and build a solid foundation toward a $1 trillion economy by 2050," stressed Mr Kafulila.

The focus now is to move projects from preparation and financial close to actual construction, converting private investment into infrastructure and public services.