Tanzania’s National Social Security Fund plans to pump millions of dollars into key infrastructure projects as it seeks to raise funds to meet growing pension obligations.

The projects include highways, bridges and power generation — to be implemented and managed through special purpose vehicle (SPVs).

The fund also plans to assume either full control of the companies it has shares in or will partly own them through joint ventures, as it seeks to enhance members’ wealth.

NSSF director general, Ramadhan Dau said the fund is considering offering its share of ownership in these projects to its members through private placement.

Power plant

It is understood that the fund, with an investment portfolio value of $627 million, is targeting the Kigamboni commercial bridge in which it will invest $130 million, and the Mkuranga power generating plant that is expected to produce 150MW at a cost of $162 million.

The fund also plans to invest in the construction of the 100 kilometre Dar es Salaam-chalinze dual carriage road and is in the process of acquiring the Kiwira Coal Mine in Mbeya, jointly with other investors.

The mine is expected to generate nearly 300MW in the near future. NSSF bought the mine after the state failed to repay a $31 million outstanding debt.

Katani deal

The EastAfrican has learnt that NSSF recently sealed a deal with Katani Ltd, where it offered long-term credit to the tune of $10 million for the expansion of the Hale Sisal Energy plant — the first in the world — and hydropower project at Ngombezi that will generate 15 megawatts of electricity.

“Studies show there’s great potential in the plant, which could employ over one million people — who could in turn boost the fund’s membership,” said Mr Dau.

“In order to create liquidity, the companies will be listed on the Dar es Salaam Stock Exchange once they meet the regulatory requirements,” Dr Dau said.

Daniel Mghwira, market analyst with Miradi associates in Tanzania said the NSSF is assuming a broader role in Tanzania’s overall development as well as helping drive the growth of the country’s economy.

“If you look at the NSSF’s envisaged investment you will realise that this expansion suggests the fund is ready to move beyond its original mandate as a ‘strategic reserve’ to becoming a more proactive player in economic growth,” Mr Mghwira said.