Tanzania: US agency scraps $472.8m aid over Zanzibar poll issues

A U.S. aid agency has canceled $472.8 million of funding for Tanzania after disputed elections in Zanzibar citing that the process was “neither inclusive nor representative.”

The U.S. embassy in Tanzania said it is was “gravely alarmed” at the recent annulment of the Zanzibar presidential election.

Tanzania which relies on donor funds will now face economic difficulties at balancing its budget.

US agency freezes $473 million aid to Tanzania over Zanzibar election https://t.co/bGqlGlBiAl pic.twitter.com/NzLZ9RQf7Z

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“The budget for Tanzania is not self sustainable, its own resources are not sufficient to cover all the expenses so you find that most of the time you need also external financing in terms of loans or grants.”

“The Tanzanian Revenue Authority is able on average to collect 1 point something trillion per month, so it’s like saying the MCC is withholding the entire total revenue for the month in Tanzania,” added Muhajir.

The money was intended to be spent on improving the availability and reliability of electricity in rural areas. The government is now tasked with preparing a proper finance spending.

Tanzania won a five-year package of grants in 2008 worth $698 million from MCC, an independent US government foreign aid agency, but the award of a second round of grants has now been shelved.

“The government has already started preparing its own budget. It means that if this amount was part of the budget the government has to rethink where to find this amount of money, which is equivalent to our total monthly revenue collected by Tanzanian Revenue Authority,” said Muhajir.

The election was a re-run of previous polls held on Oct. 25 that were annulled by Zanzibar’s electoral authority on grounds of fraud. The opposition contested the decision to hold another vote, saying it had won the first one.