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UPDATE 1-Tanzania debut Eurobond could be up to $1 bln
February 5, 2014 / 6:36 PM / 4 years ago

UPDATE 1-Tanzania debut Eurobond could be up to $1 bln

(Adds current account deficit details, background)

NAIVASHA, Kenya, Feb 5 (Reuters) - Tanzania’s debut Eurobond could be up to $1 billion and is likely to be issued in the second half of 2014, Tanzania’s Central Bank Governor Benno Ndulu said on Wednesday.

Tanzanian officials want to build new roads, railways, ports and to tap the country’s vast natural gas and coal reserves to end chronic energy shortages.

Ndulu said the government has yet to decide the size of the bond but expects it to be between $500 million and $1 billion. “Anything up to a billion should make sense,” he told Reuters on the sidelines of a mobile money telephony conference in Kenya.

Ndulu added the previous plan to issue the bond in the 2013/2014 financial year ending June will be difficult to pull off and therefore it would be “more realistic (to assume it will be issued) during the first quarter of the new financial year”.

The economy is seen expanding at around 7 percent over the next few years and the government has stepped up borrowing to fund the country’s growing infrastructure needs.

Ndulu said Tanzania is also on course to rein in its large current account deficit, which the International Monetary Fund put at 13.5 percent in the fiscal year 2012/2013, some way above the government’s target of 5 percent or below.

“We are working hard to bring it down back to 5 percent this year and I think we may be able to do that,” Ndulu added. (Reporting by Drazen Jorgic; Editing by Sonya Hepinstall)

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