The financing agreement, backed by institutions from Sweden, Italy and Poland, will support construction of two major sections of the railway network — the Makutupora–Tabora stretch and the Tabora–Isaka line — as Tanzania pushes ahead with one of Africa’s largest infrastructure projects.

The railway forms part of the broader Central Corridor trade route that connects the Port of Dar es Salaam with inland markets including Democratic Republic of the Congo, Burundi, Rwanda and Uganda.

Speaking during the signing ceremony in Dodoma, Tanzania’s Minister for Transport, Makame Mbarawa, described the agreement as a major step toward strengthening regional economic integration and modernising transport infrastructure in East Africa.

“Tanzania is implementing one of the region’s most strategic infrastructure investments,” Mbarawa said, adding that more than 2,100 kilometres of railway are currently under construction out of a planned 4,752-kilometre network.

The project is part of a growing wave of railway modernisation efforts across Africa, where governments are investing heavily in rail infrastructure to reduce transport costs, improve regional connectivity and shift cargo movement from roads to lower-emission rail systems.

Tanzania says the completed sections of the railway are already producing economic and environmental gains. The operational Dar es Salaam–Dodoma route has transported nearly six million passengers and around 120,000 tonnes of cargo, according to government figures.

Authorities say the shift from road freight to electrified rail transport has reduced fuel consumption by an estimated 17 million litres while cutting carbon emissions by more than 50 percent.

The electrified railway, designed for speeds of up to 160 kilometres per hour, is expected to significantly reduce cargo transit times between the Port of Dar es Salaam and inland markets, strengthening Tanzania’s position in regional trade competition against rival transport corridors in East Africa.

Finance Minister Khamis Mussa Omar said the railway would stimulate growth beyond the transport sector, creating opportunities in agriculture, mining, logistics and tourism across the 12 regions the line traverses.

“SGR is not only for Tanzania but for the entire region,” Omar said. “This integration will stimulate broader economic growth.”

Tanzania is also working with the World Bank to identify investment and economic opportunities emerging along the railway corridor, government officials said.

The financing deal also highlights growing European involvement in African infrastructure development at a time when global powers are competing for influence in strategic trade and transport projects across the continent.

Sweden’s ambassador to Tanzania, Charlotta Ozaki Macias, said Swedish-linked companies have already secured contracts tied to railway signalling systems and advanced rail technologies worth hundreds of millions of dollars.

She said the railway would contribute to climate goals by reducing road congestion, lowering emissions and improving transport safety.

Tanzania’s SGR project aims to replace the country’s ageing metre-gauge railway system inherited from the colonial era. Once completed, the network is expected to connect the Indian Ocean port of Dar es Salaam to Mwanza on the shores of Lake Victoria, with future links extending into neighbouring countries.

Analysts say the project could reshape trade flows across East and Central Africa by improving access for landlocked economies to international shipping routes through Tanzania’s ports.

Notes to Editors

· The Standard Gauge Railway (SGR) is a flagship infrastructure project being implemented by the Government of Tanzania to modernise rail transport and strengthen regional trade connectivity.

· The project is coordinated through the Tanzania Railways Corporation, which oversees development and operations of the national railway network.

· The newly secured financing package of approximately $1.28 billion will fund construction of key sections between Makutupora–Tabora and Tabora–Isaka, expanding the central railway corridor.

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