VIII. TRADE AND PROJECT FINANCING Trade and Project Financing is provided by the following financial institutions: Tanganyika Development and Fax: 255-51-46145 Finance Company Limited (TDFL) Tlx: 41153 DEVFIN-TZ P.O. Box 2478 Dar es Salaam, Tanzania (Project financing) Tanzania Investment Bank (TIB) Fax: 255-51-46235 P.O. Box 9373 Tlx: 41259 Dar es Salaam, Tanzania (Project financing) National Bank of Commerce (NBC) Fax: 255-51-46235 P.O. Box 1255 Tlx: 41581 NATCMD-TZ Dar es Salaam, Tanzania (Trade and project financing) Tanzania Capital Venture Company P.O. Box 2535 Dar es Salaam, Tanzania (Project financing) Private Banks: Meridian Biao Bank Tanzania Ltd. Fax: 255-51-44553 P.O. Box 72647 Dar es Salaam, Tanzania (Trade financing) Standard Chartered Bank Fax: 255-51-44594 P.O. Box 9011 Tlx: 41079 Dar es Salaam, Tanzania (Trade financing) Brief Description of Banking System After nearly 25 years of government monopoly, GOT passed legislation in August 1991 to allow for reintroduction of private banking systems. So far 5 private banks have been registered and Meridian Biao and Standard Charter are fully operational from August 1993. Two more private banks (Bank Asili and Kenya Commercial Bank) are expected to be fully operational by the end of the year. Foreign Exchange Controls Affecting Trading There are no foreign exchange controls affecting trading. Exporting and importing trade have been streamlined, import and export licenses have been abolished, exporters are now allowed to utilize all their export earnings while importers are assisted through Open General License (OGL), Import support and commodity import support provided by donor agencies. What is General Financing Availability While NBC, Meridian and Standard Chartered Banks would provide financial resources for exports, and donor agencies have provided funding for imports, availability of trading financing is compound by high interest rates and lower producer's prices. How to Finance Exports/Methods of Payment While NBC, Meridian Biao and Standard Chartered Banks provide export financing, problem of high interest has impeded export businesses. Normally, NBC., Meridian and Standard Chartered provides overdraft facilities to exporters to be repaid in 30,40,50,60 and 90 days and the interest rates (ranging from 13-30 percent) depends on the number of days and the extent of the risk involved. Types of Available Export Financing and Insurance Local banks provide overdraft facilities to local exporters which are repayable between 30 to 90 days. OPIC insurance is still available to Tanzania. EXIMBANK is however suspended in Tanzania. Local insurance company provides cover against loss, damage and destruction. It does not provide financing for exports or imports. Project Financing Available, Including Lending from Multilateral Institutions and Types of Projects Supported Project financing is available from TDFL, TIB, NBC, Tanzania Capital Venture, East African Development Bank, African Development Bank and International Finance Corporation: Multilateral Development Banks: 1. The International Bank for Reconstruction and Development (IBRD), a member of the World Bank group makes long-term loans at market- related rates primarily to developing nations. The International Development Agency (IDA), the soft loan window of the World Bank, lends to the poorest of the development countries. Both the IBRD and IDA work to promote broadly based economic growth and frequently focuses on structural adjustment, sectoral reform and individual project lending and operate under the same set of procurement guidelines. Typically the World Bank does not finance the entire cost of a project. Rather, it finances the components of a project purchased with foreign exchange, which on average is about 40 per cent of the total project cost. Each project may cover a wide variety of sectors and can involve anywhere from one to hundreds of separate contracts providing export business opportunities for suppliers worldwide. CONTACTS: U.S. Department of Commerce Liaison to the U.S. Executive Directors Office International Bank for Reconstruction and Development 1818 H. St., NW Washington D.C. 20433 Tele: (202) 458-0118 Fax: (202) 477-2967 Office of Multilateral Development Banks U.S. Foreign Commercial Service U.S. Department of Commerce Room H-1107 Washington D.C. 20230 Tele: (202) 482-3399 2. The African Development Bank (AFDB), headquartered in Abidjan, Cote d'Ivoire, is an international financial institution created by Africans in 1963 to promote the economic and social development of its member African countries. Founded with initial capital resources of USD 250 million, it has authorized capital today of over USD 22.3 billion. The bank belongs to the African Development Bank Group (ADBG) which also includes the African Development Fund (ADF) and the Nigerian Trust Fund (NTF). The AFDB makes loans to development projects in 51 countries in Africa. The ADB provides development financing on concessionary terms to the poorer African member countries. The NTF was established by the Government of Nigeria in 1976 to assist in the development efforts of the poorer ADB members. The ADFB has 21 non-regional members. The United States joined in 1982. CONTACTS: U.S. Department of Commerce Liaison Office to the U.S. Executive Directors Office African Development Bank Ave. Joseph Anoma 01 B.P. 1387 Abidjan 01, Cote D'Ivoire Tele: (225) 21-46-16 Fax: (225) 22-24-37 Office of Multilateral Development Banks U.S. & Foreign Commercial Service U.S. Department of Commerce Room H-1107 Washington, D.C. 20230 Tele: (202) 482-3399 Fax: (202) 273-0927 List of Banks with Correspondent U.S. Banking Arrangements: NBC appears to be the only Bank with correspondent arrangements with U.S. Banks. NBC has correspondent arrangements with Chase Manhattan Bank, Morgan Trust Guarantee and CITI Bank.