President John Magufuli revealed the construction cost of the Stiegler’s Gorge Hydroelectric Power Station would cost around $2.8 billion, but reports from Egypt say it could shoot up to $3.6 billion.
The president announced in Dar es Salaam that the government expects an Egyptian delegate led by the country’s Prime Minister Mostafa Madbouly in Tanzania ahead of signing a landmark deal for the construction of the hydroelectric dam.
On December 12, 2018, when Kenya was celebrating its 55th independence day, President Magufuli and PM Mostafa Madbouly witnessed the signing of the official Rufiji Hydropower Plant between Tanzania Electric Supply Company (TANESCO) and Egyptian companies – Arab Contractors and El Sewedy Electric at the State House.
The two companies will have a will have a 55 per cent 45 per cent stake in the project respectively having won the construction bid in August 2017.
Vice President Samia Suluhu Hassan, Prime Minister Kassim Majaliwa, Speaker John Ndugai, Chief Justice Professor Ibrahim Juma, clerics and political leaders graced the event with their presence.
Addressing the officials during the historical moment, Madbouly stated that Egyptian institutions would work with Tanzania to cement a strong bond of relationship between the two countries.
He added that Egyptian firms in Tanzania are partnering with the local sector in fulfilling the government’s agenda of achieving a middle-income economy status by 2025 through industrialisation.
The 2,100 MW project would more than double the country’s power generation capacity, ensuring Tanzanians gain access to reliable and affordable electricity.
The multimillion infrastructure project will reduce as well the operation costs of industries making them more productive and competitive in the market.
Tanzania’s power tariffs remain highest in comparison to South Africa, India, the United States and South Korea. Tanzania currently produces 1,560 MW which is not sustainable for the foreseen development of the economy.
Tanzania has undertaken various infrastructure projects in an attempt to lure business from outside and better its ease of doing business including Standard Gauge Railway (SGR), upgrade of road networks among others.
The need for infrastructure development in the East African Community (EAC) to bolster trade has compelled governments to allocate fat budget for such assignments.
The power project has faced opposition and criticism from conservationists both from home and abroad due to its location in Selous Game Reserve, a U.N.-designated world heritage site in southern Tanzania.
It was argued that the project would cause harm to over 200,000 people including fishermen and farmers who depend on the water source for livelihoods and disturb the ecosystem of the wildlife.
The environmental impact was questioned in a bid to change the narrative of the story. However, President Magufuli defended the project stating it would curb the issue of deforestation as people cut down trees for charcoal and improve the country’s economic development.