In June 2014, Chinese Vice President Mr. Li Yuanchao’s first visit to Tanzania provided many groundbreaking opportunities for both countries. One of them was literal.
Mr. Li dug in the foundation stone for Tanzania’s first energy efficient commercial complex - the Mwalimu Nyerere Foundation (MNF) Square. The complex, which will be built by Chinese real estate company CRJE Ltd., is China’s first commercial building project in East Africa. The ceremony was attended by Dan Kasirye, IFC’s Country Manager for Tanzania, Mr. Dai Hegen, Chairman of the China Railway Group and Mr. Shi Yuan, Chairman of CRJE.
MNF Square is adopting IFC’s green-building standards, which can help reduce the building’s energy consumption by 20 percent. Globally, buildings account for a quarter of all man-made carbon dioxide emissions worldwide. Investments in green buildings help fight climate change, especially in Africa, where demand for commercial real estate is booming.
IFC’s investment in CRJE Estate dates back to 2010 with a loan for the initial phase of this property project. It was IFC’s first for a Chinese company investing in Africa. The corporation later more than doubled the loan to $22 million to fund the new design for this multi-storey MNF Square, which will include 250 hotel rooms and 8,200 square meters of office and retail space.
CRJE Estate is a wholly owned subsidiary of China Railway Jianchang Engineering Co, one of the largest construction companies in Africa. The land for the site is owned by the MNF foundation, named after late Tanzanian President and visionary, Julius Nyerere.
The project comes at an apt moment for Tanzania. The country’s economy has been expanding steadily, with growth touching 7 percent last year. As more foreign investors eye Tanzania, and local companies expand; MNF Square will meet the demand for hotel, office and retail space. The complex will also create linkages with local suppliers and producers, and offers an urban foothold for smaller businesses outside Dar es Salaam.
Mr. Dai Hegen, President of the China Railway Group said; "China Railway will make MNF square a first-class project in management, quality, efficiency, technology and experience. We will continue to support CRJE, our local company, to further expand their business in Tanzania, so as to create a better future for the friendship between China and Tanzania."
“Supporting South-South businesses and cooperation in Africa is one of IFC’s strategic priorities,” said Oumar Seydi, IFC Director of Eastern and Southern Africa. “The MNF square project demonstrates that Chinese developers and investors can be a vital force for Africa’s development by building infrastructure, boosting trade, and creating jobs,”
Overall, IFC's China to Africa business grew 17 times from $28 million before 2004 to around $500 million in the last four years. In addition to direct investments, IFC mobilized $72 million and $60 million from Chinese banks for telecom projects in Ghana and Nigeria respectively. IFC has also supported around $400 million in trade between China and Africa through its Global Trade Finance Program since 2006.
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