Campaigners in Tanzania have called on their government not to repay $61.5 million to the World Bank on loans for a water project which yielded ‘no positive results’.
The Dar es Salaam water supply and sanitation project, which lasted from 2003 to 2010, also included loans of $48 million from the African Development Bank and $34 million from the European Investment Bank. The loans are due to begin being repaid later this year.
A condition of the loans, as well as debt relief for Tanzania, was the privatisation of Dar es Salaam's water. City Water, a consortium which included Biwater from the UK and HP Gauff Inegnieure GmbH from Germany, began operating Dar es Salaam’s water in 2003. However, as the World Bank says, City Water “was unable to meet many of its targets and obligations from the start”. One of the reasons was because shareholders failed to invest promised equity. In May 2005, fearing that City Water was about to collapse, the Dar es Salaam water authority terminated their contract, and on 1 June the company’s three British managers were deported.
In 2007, a UN arbitration ruled that...