Dar inks $1.7bn energy, construction deals with China

TANZANIA has signed contracts worth $1.7 billion with Chinese companies to construct power plants and housing units in east Africa's second-largest economy.

The new investment deals mark China's growing economic presence in Tanzania, which has made big discoveries of natural gas off its southern coast.

"The government has today signed seven agreements with six Chinese companies worth $1.7 billion, which will be invested in power plants and construction of residential and commercial housing projects," the Tanzanian prime minister's office said in a statement on Thursday.

The signing of the investment deals was witnessed by Tanzanian Prime Minister Mizengo Pinda in Guangzhou, China.

The deals include a $692.7 million contract awarded to Tebian Electric Apparatus Stock Co Ltd, China's largest manufacturer of high-voltage transformers, for the construction of a 400 kV power transmission line.

Tanzanian state-run National Housing Corporation signed deals worth $700 million with the China Railway Jianchang Engineering Company Ltd (CRJE) and China Poly Group Corporation to develop residential and commercial property.

Tanzania signed a framework agreement in May with China Merchants Holdings (International) Co Ltd for the construction of a new port, special economic zone and railway network that could involve more than $10 billion.

China, which built a railway linking Tanzania and Zambia in the 1960s and 1970s, is also financing a $1.2 billion 532-km (330-mile) natural gas pipeline from the south east of the country to the commercial capital Dar es Salaam.

In 2011 China's Sichuan Hongda Co. Ltd signed a $3 billion deal with Tanzania to mine coal and iron ore.

Chinese companies are also eyeing Tanzania's natural gas reserves and are expected to bid for oil and gas blocks in the country, according to the African country's energy ministry.