WASHINGTON, July 5, 2007 — The World Bank Board of Executive Directors today approved an additional International Development Association (IDA) credit* of US$60 million for the Government of Tanzania to support the second phase of the Health Sector Development Project.

The additional funds will support Tanzania’s Second Health Sector Strategic Plan (HSSP) for an additional two years: 2007-2009. Through this project there will be increased funds for more efficient delivery of essential health services and staffing at district level.

Out of the total additional financing, $35 million will be disbursed through a pooled fund, which finances the annual work plan and budget of the Ministry of Health and Social Welfare, and the Comprehensive Council Health Plans of 121 districts. Nine Development Partners, including the World Bank, United Nations Fund for Population Activities, Canada, Denmark, Ireland, Germany, the Netherlands, Norway and Switzerland will contribute to this “health basket fund” in order to reduce transaction costs and strengthen government systems. The remaining $25 million will support the Government of Tanzania’s innovative public-private partnership for increasing the use of insecticide treated bed-nets to prevent malaria.

“The main objective of the additional financing is to assist the Government of Tanzania in continuing to improve the quality of health services and the management of resources allocated to the health sector through strengthening health sector policy and strategy, and through building  institutional capacity,” said Julie McLaughlin, Lead Health Specialist of the World Bank in Tanzania.

The additional financing is consistent with IDA’s Country Assistance Strategy 2007-2010 which commits to harmonized aid modalities and recognizes the impact achieved through sector-wide approaches and budget support in the health sector 2000-2006 when child mortality was reduced by 24%.

“IDA funds are employed to finance activities under the health sector’s Medium-Term Expenditure Framework (MTEF) which defines objectives, strategies and associated expenditures for each year. This approach improves ownership, sustainability and implementation capacity, while reducing transaction costs,” said McLaughlin, citing reproductive and child health, malaria and HIV/AIDS as services which receive substantial funding from the pooled fund.

The Government of Tanzania in 2000, with support of IDA and other development partners, embarked on a long-term health sector development program aimed at improving access, utilization, quality and financing of health services through increased efficiency and effectiveness in use and allocation of resources.

“The World Bank Group is proud to be part of the harmonized support to Tanzania’s efforts aimed at improving its health sector. The additional financing has come at the right time when the Government needs resources necessary for achieving Poverty Eradication (MKUKUTA) and Millennium Development Goals. It is our hope that the additional financing will be used for the intended purpose of attaining sustainable improvements in the health status of the people of Tanzania,” said Judy O’Connor, Country Director for Tanzania and Uganda. 

*The credit is on standard International Development Association (IDA) terms, with a commitment fee of 0.5 percent and a service charge of 0.75 percent. The period of maturity is 40 years, including a 10-year period of grace