The Government of the United Republic of Tanzania and the Government of Sweden have today signed an Agreement to provide for additional Swedish contribution to Poverty Reduction Budget Support (PRBS) in 2005/06. The additional Sweden contribution for FY 2005/06 amount to Swedish Kronor 80,000,000 equivalent to about Tshs 12 billion making a total contribution of SEK 200 million. The additional contribution by Sweden entails a total contribution of SEK 430 million to the budget support over the period of 2003 – 2005, representing an increase of 23 percent to the total commitment of SEK 350 million in the 3-year agreement that will come to an end in December 2006, which is equivalent to an increase of 67 percent of the original commitment for FY 2005/06.
The main objective of budget support is to enable the Government to improve the supply and quality of services delivered to the nation thereby making an important contribution to economic growth both nationally and at local level. Sweden is among the first development partners to contribute to the Budget support since financial year 2001/02. Sweden support to Tanzania conforms to the principles contained in the Joint Assistance Strategy (JAS) currently under preparation and specifically to the Government of Tanzania’s preferred aid-modality i.e. general budget support which increases predictability of resources and enhances local ownership and accountability for the reduction of poverty and economic growth in line with the National Strategy for Growth and Poverty Reduction (NSGRP or MKUKUTA). Following this principle Sweden is firmly committed to reduce the number of sectors and projects they are directly active in thereby increase their budget support which is a more efficient way to contribute to Tanzania’s economic growth and poverty reduction.
The signing ceremony took place at the Ministry of Finance. The Government of the United Republic of Tanzania was represented by Mr. Peniel M. Lyimo, Permanent Secretary while the Government of Sweden was represented by H.E. Torvald Åkesson, Ambassador of Sweden to Tanzania.
Ministry of Finance Embassy of Sweden
Dar es Salaam23 September 2005