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CONFORMED COPY 
CREDIT NUMBER 4813-TZ 
 
Financing Agreement 
 
(Eighth Poverty Reduction Support Development Policy Financing) 
 
between 
 
UNITED REPUBLIC OF TANZANIA 
 
and 
 
INTERNATIONAL DEVELOPMENT ASSOCIATION 
 
Dated October 8, 2010  
 
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CREDIT NUMBER 4813-TZ 
 
FINANCING AGREEMENT 
 
AGREEMENT dated October 8, 2010, entered into between UNITED 
REPUBLIC OF TANZANIA (“Recipient”) and INTERNATIONAL DEVELOPMENT 
ASSOCIATION (“Association”) for the purpose of providing financing in support of the 
Program (as defined in the Appendix to this Agreement).  The Association has decided to 
provide this financing on the basis, 
inter alia
,
of: (a) the actions which the Recipient has 
already taken under the Program and which are described in Section I of Schedule 1 to 
this Agreement; and (b) the Recipient’s maintenance of an appropriate macro-economic 
policy framework. The Recipient and the Association therefore hereby agree as follows: 
ARTICLE I 
—
GENERAL CONDITIONS; DEFINITIONS 
 
1.01. 
The General Conditions (as defined in the Appendix to this Agreement) 
constitute an integral part of this Agreement. 
 
1.02. 
Unless the context requires otherwise, the capitalized terms used in this 
Agreement have the meanings ascribed to them in the General Conditions or in 
the Appendix to this Agreement. 
 
ARTICLE II 
—
FINANCING 
2.01. 
The Association agrees to extend to the Recipient, on the terms and conditions 
set forth or referred to in this Agreement, a credit in an amount equivalent to 
seventy five million eight hundred thousand Special Drawing Rights 
 
(SDR 75,800,000) (referred to
 variously as “Credit” and “Financing”). 
2.02. 
The Recipient may withdraw the proceeds of the Financing in support of the 
Program in accordance with Section II of Schedule 1 to this Agreement.
 
2.03. 
The Maximum Commitment Charge Rate payable by the Recipient on the 
Unwithdrawn Financing Balance shall be one-half of one percent (1/2 of 1%) per 
annum. 
2.04. 
The Service Charge payable by the Recipient on the Withdrawn Credit Balance 
shall be equal to three-fourths of one percent (3/4 of 1%) per annum. 
2.05. 
The Payment Dates are March 15 and September 15 in each year. 
2.06. 
The principal amount of the Credit shall be repaid in accordance with repayment 
schedule set forth in Schedule 2 to this Agreement. 
2.07. 
The Payment Currency is Dollars. 
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ARTICLE III 
—
PROGRAM 
 
3.01. 
The Recipient declares its commitment to the Program and its implementation.  
To this end: 
 
(a) 
the Recipient and the Association shall from time to time, at the request 
of either party, exchange views on the progress achieved in carrying out 
the Program; 
 
(b) 
prior to each such exchange of views, the Recipient shall furnish to the 
Association for its review and comment a report on the progress 
achieved in carrying out the Program, in such detail as the Association 
shall reasonably request; and 
 
(c) 
without limitation upon the provisions of paragraphs (a) and (b) of this 
Section, the Recipient shall exchange views with the Association on any 
proposed action to be taken after the disbursement of the Financing 
which would have the effect of materially reversing the objectives of the 
Program, or any action taken under the Program including any action 
specified in Section I of Schedule 1 to this Agreement. 
 
ARTICLE IV
—REMEDIES OF THE ASSOCIATION 
 
4.01. 
The Additional Event of Suspension shall be that a situation has arisen which 
shall make it improbable that the Program, or a significant part of it, will be 
carried out. 
 
ARTICLE V
—EFFECTIVENESS; TERMINATION
 
5.01. 
The Additional Condition of Effectiveness consists of the following: 
 
The Association is satisfied with the progress achieved by the Recipient in 
carrying out the Program and with the adequacy of the Recipient’s 
macroeconomic policy framework. 
 
5.02. 
The Effectiveness Deadline is the date ninety (90) days after the date of this 
Agreement. 
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ARTICLE VI 
—
REPRESENTATIVE; ADDRESSES
 
6.01. 
The Recipient’s Representative is its Minister responsible for Finance. 
6.02. 
The Recipient’s Address is: 
Ministry of Finance and Economic Affairs 
P.O. Box 9111 
Dar es Salaam 
United Republic of Tanzania 
 
Facsimile: 
 
(255) 222 11 0326  
 
6.03. 
The Association’s Address is: 
 
International Development Association 
1818 H Street, N.W. 
Washington, D.C. 20433 
United States of America 
 
Cable 
address: 
 Telex: 
  Facsimile: 
 
INDEVAS 
 248423(MCI) 
 1-202-477-6391 
Washington, D.C. 
  
 
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AGREED at District of Columbia, United States of America, as of the day and 
year first above written. 
 
UNITED REPUBLIC OF TANZANIA   
 
 
By 
/s/ Mustafa Mkulo 
 
Authorized Representative 
 
INTERNATIONAL DEVELOPMENT ASSOCIATION  
 
By 
/s/ John McIntire 
 
Authorized Representative 
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SCHEDULE 1 
 
Program Actions; Availability of Financing Proceeds 
 
Section I. 
Actions Taken Under the Program 
The actions taken by the Recipient under the Program include the following:
 
1. 
Private Sector Development
:
The Recipient finalized its national public-private 
partnership (PPP) policy to facilitate public-private partnerships in all sectors, 
and the 
PPP bill was approved by the Recipient’s parliament. 
2. 
Private Sector Development
:
The Recipient has made progress in completing its 
process 
of implementing strategies and streamlining procedures to arrive at 
a
comprehensive, fast, and user-friendly land registry
.
3. 
Forestry and Wildlife, Fisheries, and Minerals Sectors
:
The Recipient has an 
approved action plan to improve accountability and transparency in allocating 
natural resource licenses and concessions and implementation of this action plan 
has been initiated.  
4. FY09 
Budget 
Expenditure
:
The Recipient’s expenditure outturn for FY08/09 was 
consistent with the approved budget and recurrent budget deviation was reduced. 
5. Infrastructure
:
The Recipient has decreased port congestion as a result of three 
key measures: (i) Tanzania Ports Authority (TPA) prepared a preliminary version 
of a time-bound action plan for 
assuming its role as a landlord, as is required 
by law, and focusing on port performance rather than on operations
;
(ii) 
based on the TPA’s application, SUMATRA approved an increase in port storage 
tariffs and reduction in free time; and (iii) the Recipient established a separate 
segregated storage area for impounded containers. 
6. 
Governance and Public Sector Management
:
The Recipient has submitted to its 
parliament a new public procurement bill that increases the autonomy of its 
Public Procurement Regulatory Authority (PPRA) and empowers PPRA to 
enforce procurement rules. 
 
7. 
Health, Education and Water Sectors
:
The Recipient has carried out performance 
reviews in each of the health, education and water sectors (based on an 
assessment of progress on agreed outcome targets, adequacy of resource 
allocation, achievement of sector milestones, and adequacy of stakeholder 
consultations). 
8. 
Tanzania Electric Supply Company Ltd. (TANESCO) Financial Recovery Plan
:
An Energy Tariff application was successfully submitted by TANESCO to the 
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regulator to allow for revenue collection to meet full operational cost recovery in 
2011, and full cost recovery by 2013. 
Section II. 
Availability of Financing Proceeds
A. General
.
The Recipient may withdraw the proceeds of the Financing in 
accordance with the provisions of this Section and such additional instructions as 
the Association may specify by notice to the Recipient. 
B. 
Allocation of Financing Amounts
.
The Financing is allocated in a single 
tranche, from which the Recipient may make withdrawals of the Financing.  The 
allocation of the amounts of the Financing to this end is set out in the table 
below: 
Allocations 
Amount of the Financing Allocated 
(expressed in SDR) 
Single Tranche 
75,800,000 
TOTAL AMOUNT 
75,800,000 
C. 
Withdrawal Tranche Release Conditions.
 
No withdrawal shall be made of the Single Withdrawal Tranche unless the 
Association is satisfied (a) with the Program being carried out by the Recipient, 
and (b) with the appropriateness of the Recipient’s macroeconomic policy 
framework. 
 
D. 
Deposits of Financing Amounts.
 
Except as the Association may otherwise agree:   
1. 
all withdrawals from the Financing Account shall be deposited by the 
Association into an account designated by the Recipient and acceptable 
to the Association; and 
2.  
the Recipient shall ensure that upon each deposit of an amount of the 
Financing into this account, an equivalent amount is accounted for in the 
Recipient’s budget management system, in a manner acceptable to the 
Association. 
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E. Excluded 
Expenditures
 
The Recipient undertakes that the proceeds of the Financing shall not be used to 
finance Excluded Expenditures. If the Association determines at any time that an 
amount of the Financing was used to make a payment for an Excluded 
Expenditure, the Recipient shall, promptly upon notice from the Association, 
refund an amount equal to the amount of such payment to the Association. 
Amounts refunded to the Association upon such request shall be cancelled.
 
F. 
Closing Date.  
The Closing Date is August 31, 2012. 
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SCHEDULE 2
 
Repayment Schedule 
 
Date Payment Due 
Principal Amount of the Credit 
repayable 
(expressed as a percentage)* 
On each March 15 and September15: 
 
Commencing March 15, 2021 to and including 
September  15, 2030 
1% 
Commencing March 15, 2031 to and including 
September 15, 2050 
2% 
*
The percentages represent the percentage of the principal amount of the Credit to be 
repaid, except as the Association may otherwise specify pursuant to Section 3.03(b) of 
the General Conditions. 
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APPENDIX 
 
Section I. Definitions 
 
1. 
“Excluded Expenditure” means any expenditure: 
(a)  
for goods or services supplied under a contract which any national or 
international financing institution or agency other than the Association or 
the Bank has financed or agreed to finance, or which the Association or 
the Bank has financed or agreed to finance under another credit, grant or 
loan; 
 
(b) 
for goods included in the following groups or sub-groups of the Standard 
International Trade Classification, Revision 3 (SITC, Rev.3), published 
by the United Nations in Statistical Papers, Series M, No. 34/Rev.3 
(1986) (the SITC), or any successor groups or subgroups under future 
revisions to the SITC, as designated by the Association by notice to the 
Recipient: 
 
Group
Sub-group Description 
of 
Item 
112  
Alcoholic 
beverages 
121 
 
Tobacco, un-manufactured, tobacco 
refuse 
122 
 
Tobacco, manufactured (whether or not 
containing tobacco substitutes) 
525 
 
Radioactive and associated materials 
667 
 
Pearls, precious and semiprecious 
stones, unworked or worked 
718 718.7 
 
Nuclear reactors, and parts thereof; fuel 
elements (cartridges), non-irradiated, 
for nuclear reactors 
728 
728.43  
Tobacco processing machinery 
897 
897.3 
Jewelry of gold, silver or platinum 
group metals (except watches and watch 
cases) and goldsmiths’ or silversmiths’ 
wares (including set gems) 
971 
 
Gold, non-monetary (excluding gold 
ores and concentrates) 
(c) 
for goods intended for a military or paramilitary purpose or for luxury 
consumption; 
 
(d) 
for environmentally hazardous goods, the manufacture, use or import of 
which is prohibited under the laws of the Recipient or international 
agreements to which the Recipient is a party; 
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(e) 
on account of any payment prohibited by a decision of the United 
Nations Security Council taken under Chapter VII of the Charter of the 
United Nations; and 
 
(f) 
with respect to which the Association determines that corrupt, fraudulent, 
collusive or coercive practices were engaged in by representatives of the 
Recipient or other recipient of the Financing proceeds, without the 
Recipient (or other such recipient) having taken timely and appropriate 
action satisfactory to the Association to address such practices when they 
occur. 
 
2. 
“Fiscal Year” or “FY” means the Recipient’s fiscal year commencing on July 1 
and ending on June 30 of the following year. 
3. 
“General Conditions” means the “International Development Association 
General Conditions for Credits and Grants”, dated July 31, 2010, with the 
modifications set forth in Section II of this Appendix. 
4. 
“Letter of Development Policy” means the letter dated August 23, 2010, from the 
Recipient to the Association, describing the Program (as hereinafter defined), and 
declaring the Recipient’s commitment to the execution of the Program, and 
requesting assistance from the Association in support of the Program during its 
execution. 
5. 
“PPRA” means the Recipient’s Public Procurement Regulatory Authority 
established and operating under Section 5 of the Public Procurement Act No. 21 
of 2004 of the laws of the Recipient, and includes any successors thereto. 
6. 
“Program” means the program of actions, objectives and policies designed to 
promote growth and achieve sustainable reductions in poverty and set forth or 
referred to in the Letter of Development Policy. 
7. 
“Single Tranche” means the amount of the Financing allocated to the category 
entitled “Single Tranche” in the table set forth in Part B of Section II of  
Schedule 1 to this Agreement. 
8. 
“SUMATRA” means Recipient’s Surface and Marine Transport Regulatory 
Authority
,
a
multi-sector regulatory agency established and operating under 
an Act of Parliament (CAP 413 R.E. 2002) of 
the laws of the Recipient, and 
includes any successors thereto. 
 
9. 
“TANESCO” means Tanzania Electric Supply Company Limited, a parastatal 
company established and operating under the Companies Act (CAP 212 R.E. 
2002) of the laws of the Recipient, and includes any successors thereto. 
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10. 
“TPA” means Tanzania Ports Authority, a parastatal company established and 
operating 
under the Act of Parliament (Act No. 17 of 2004) 
of the laws of 
the Recipient, and includes any successors thereto. 
 
Section II.  Modifications to the General Conditions 
 
The modifications to the “International Development Association General 
Conditions” are as follows:   
1. 
The last sentence of paragraph (a) of Section 2.03 (relating to Applications for 
Withdrawal) is deleted in its entirety. 
2. 
Sections 2.04 (
Designated Accounts)
 and 2.05 (
Eligible Expenditures
)
are deleted 
in their entirety, and the remaining Sections in Article II are renumbered 
accordingly. 
3. 
Sections 4.01 (
Project Execution Generally
), and 4.09 (
Financial Management; 
Financial Statements; Audits
)
are deleted in their entirety, and the remaining 
Sections in Article IV are renumbered accordingly. 
4. 
Paragraph (a) of Section 4.05 (renumbered as such pursuant to paragraph 3 above 
and relating to 
Use of Goods, Works and Services
)
is deleted in its entirety. 
 
5. 
Paragraph (c) of Section 4.06 (renumbered as such pursuant to paragraph 3 
above) is modified to read as follows: 
 
“Section 4.06. 
Plans; Documents; Records 
 
…
(c) 
The Recipient shall retain all records (contracts, orders, 
invoices, bills, receipts and other documents) evidencing expenditures 
under the Financing until two years after the Closing Date. The Recipient 
shall enable the Association’s representatives to examine such records.” 
 
6. 
Section 4.07 (renumbered as such pursuant to paragraph 3 above) is modified to 
read as follows: 
 
Section 4.07. 
Program Monitoring and Evaluation 
 
…
(c)  
The Recipient shall prepare, or cause to be prepared, and 
furnish to the Association not later than six months after the Closing 
Date, a report of such scope and in such detail as the Association shall 
reasonably request, on the execution of the Program, the performance by 
the Recipient and the Association of their respective obligations under 
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the Legal Agreements and the accomplishment of the purposes of the 
Financing. 
 
7. 
The following terms and definitions set forth in the Appendix are modified or 
deleted as follows, and the following new terms and definitions are added in 
alphabetical order to the Appendix as follows, with the terms being renumbered 
accordingly: 
 
(a) 
The definition of the term “Eligible Expenditure” is modified to read as 
follows:   
 
“‘Eligible Expenditure’ means any use to which the Financing is put in 
support of the Program, other than to finance expenditures excluded 
pursuant to the Financing Agreement.” 
 
(b) 
The term “Financial Statements” and its definition as set forth in the 
Appendix are deleted in their entirety. 
 
(c) 
The term “Project” is modified to read “Program” and its definition is 
modified to read as follows:  
 
“‘Program’ means the program referred to in the Financing Agreement in 
support of which the Financing is made.”  All references to “Project” 
throughout these General Conditions are deemed to be references to 
“Program”.