VP: Take up green bond initiative for water sector

23Feb 2024
The Guardian Reporter
News
The Guardian
VP: Take up green bond initiative for water sector

VICE President Dr Philip Mpango has directed the Regional Administration and Local Governments ministry in the President’s Office (PO-RALG) and the Treasury Registrar to formulate a strategy to enable public corporations to use bonds in generating funds to facilitate quick implementation

of development projects.

 

He issued instructions during the opening of the window for the sale of green bonds to generate funds to implement water projects, held in Tanga yesterday.

He said the green bond window is a motivation to other local government authorities to use it in generating funds for implementing various projects, countrywide.

He asked the management of the Tanga Urban Water Supply and Sewerage Authority (TUWASA) to properly manage the funds which will be generated through the bonds.

“Discipline in the management of the funds will facilitate fast return of the money invested by investors in the bonds,” he stated, affirming that the government will not hesitate to take actions against any malpractices.

He advised planning early by opening a special fund to collect refunds little by little in order to eliminate challenges during payment since the refund of the money becomes a lump sum at the maturity of the bonds.

The Capital and Securities Markets Authority (CSMA) in collaboration with the Planning and Investment ministry in the President's Office, and the Water ministry need to set up an early warning instrument to monitor the scheme and identify risks that may arise.

The VP commended the TUWASA board of directors for their boldness to come up with an alternative way to get funds for the implementation of development projects.

If successful, the bond will help increase water production from 42m to 60m liters, thus expanding supply of the precious liquid in the city from 96 percent to even 100 percent by June 2025.

He said the bond will also help improve the water supply network in Muheza and Pangani towns from the current 70 percent to 95 percent by June 2025.

The project will benefit a total of 458,365 residents in Tanga city as well as Pangani and Muheza towns while also getting enough to serve 74,124 residents in Mkinga district, he stated.

Water minister Jumaa Aweso said the ministry shall work to ensure that the new bond brings positive outcomes in the sector, urging stakeholders in the sector to help the ministry to set up the bond system in water projects and thus bring positive outcomes to the society.

Hamad Chande, the Treasury deputy minister, said the strategy is aimed to enable the government to finance water projects for many years, especially those with capacity to yield revenues.

A total of 53.12bn/- is expected to be invested in the Tanga-Uwasa Green Bond for the improvement of water infrastructure to facilitate production of enough water, officials noted.

 

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