Saturday, May 12, 2012

Tanzania to get $495,000,000 from donors for budget

* Donors to give Tanzania $495 mln for budget
* Warn future aid at risk from corruption
* Demand action on reports of funds misuse

Donors have pledged to increase aid to Tanzania to $495 million for its 2012/13 budget but warned future disbursements could depend on how it tackled corruption and misuse of public funds.

The east African nation of 42 million people is among the continent's biggest per capita aid recipients. Donors contributed almost 29 percent of its 2011/12 budget and they are an important source of hard currency.

"Clear results in the fight against corruption are crucial for economic and social development in Tanzania," a group of donors said in a statement on Thursday.

"Over the coming year continued and strong attention will be paid to the way public finances are spent by closely monitoring how the findings in the latest Controller and Auditor General's annual report are being acted upon."

The nation received $453 million of aid for its 2011/12 budget, but the government's medium-term goal is to cut donor dependency in its budget to just 10 percent.

Donors that provide general budget support to Tanzania include the African Development Bank, Canada, Denmark, the European Union, Finland, Germany, Ireland, Japan, Norway, Sweden, Britain and the World Bank.

They said more than half of the funds would be disbursed in the first quarter of the next financial year to boost government spending in development projects.

President Jakaya Kikwete sacked six senior ministers this month, including the finance minister, after a report by the government's chief auditor exposed widespread misuse of funds in ministries and public institutions. 

(Reporting by Fumbuka Ng'wanakilala; Editing by Duncan Miriri)

Source: Reuters

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