EU provides €114 million in budgetary support

The European Union and the government of Tanzania signed on Tuesday an agreement that will see the EU provide €114 million (US $131 million) in budgetary support for the government’s work in basic education, primary health, rural roads, water, HIV/AIDS, agriculture and the judiciary over the next two years. The signing of the agreement marked a new stage of EU support to Tanzania, which in 2003 will total €140 million ($160.9 million) in EU aid, more than any other country in Africa. The East African nation is receiving the large amounts of aid because of its considerable poverty, large population and its successful macroeconomic and sectoral policy reforms, the EU said. "The [government's] current Poverty Reduction Strategy was adopted in 2000 and provides for increased funding in seven priority sectors which directly contribute to poverty reduction and impact greatly on the lives of the poor," the EU said. "The purpose of the new EU programme is to increase the government's capacity to undertake key expenditure in these areas," it added. The permanent secretary in the Ministry of Finance, Peniel Lyimo, said that education was an area that the government had tackled. Since launching its universal primary education initiative in 2001, he said, enrolment targets had been surpassed. The EU’s resident representative in Tanzania, William Hanna, said that donors were pleased with the progress that had been made and they were now "looking, with the government, at the question of quality, which is more difficult". HIV/AIDS initiatives would also benefit from a wider approach based on programmes, and not just projects, Hanna added. Lyimo said that despite making progress in immunisation campaigns, not enough progress was being made in the development of healthcare, due to the impact of HIV/AIDS. The EU also announced that a proportion of annual support would be triggered automatically if overall reviews of government policies and reforms were considered satisfactory. Lyimo said that the move towards budgetary support was important as the arrangement "minimises transaction costs and harmonises performance benchmarks and dialogue between parties".