By Business Insider Reporter
East Africa is entering a new phase of infrastructure expansion as Tanzania and Kenya step up negotiations with the African Development Bank (AfDB) and other financiers for billions of dollars in new loans targeting energy, transport and logistics.
The financing push, showcased at the African Investment Forum (AIF) in Rabat last week, underscores a renewed focus on unlocking long-delayed megaprojects that are central to the region’s economic transformation.
The AIF secured more than US$ 15.3 billion in investment interest for 39 bankable projects across the continent, but Tanzania and Kenya emerged among the biggest potential beneficiaries as they seek fresh capital to power grid expansion, railway construction and major road upgrades.
For Tanzania, the priority remains large-scale transport infrastructure. The government is pursuing additional AfDB financing for its flagship Standard Gauge Railway (SGR), part of a US$ 2.3 billion corridor linking the Port of Dar es Salaam to Mwanza on Lake Victoria – and eventually Rwanda, Burundi, Uganda and the eastern Democratic Republic of Congo.
The SGR is designed to transform Tanzania into a regional logistics powerhouse by opening new routes for minerals, agricultural exports and regional trade.
The AfDB has already signed a coordination agreement with Deutsche Bank and Société Générale to raise US$ 1.2 billion for the railway, and renewed financing would accelerate completion of the remaining sections.
Once operational, the SGR is expected to cut transport costs by up to 40 percent, slash travel times, expand cargo throughput at Dar es Salaam Port and attract private investment to manufacturing zones along the corridor.
Zanzibar is also seeking AfDB-backed loans to push ahead with a major transport overhaul, including new roads, climate-resilient urban transport solutions and expanded maritime services.
The US$ 260 million passenger ferry modernisation project – in early stages of review – aims to improve safety and integrate Zanzibar’s maritime system with mainland trade and tourism flows.
Kenya, meanwhile, is aggressively pursuing funding for its energy sector. The country is seeking US$ 150 million from the AfDB to expand its electricity grid and connect 1.5 million new households.
With demand rising sharply and current effective capacity of 3,082 MW under strain, Nairobi is targeting an additional 2,000 MW from geothermal and 1,000 MW from hydropower to stabilise supply for industrial growth.
Private developers are also courting investment. A Kenyan firm is in talks to secure US$ 80 million for a 150 MW project – part of a broader pipeline that will diversify the country’s generation mix, currently dominated by geothermal and hydro.
Kenya’s affordable housing programme is also searching for development financing, though details remain under wraps. If secured, the loans would support mass urban housing construction, boosting cement, steel, logistics and jobs in one of the region’s fastest-growing cities.
For both Tanzania and Kenya, the financing push reflects a wider recognition that infrastructure gaps remain the biggest barrier to investment, productivity and regional competitiveness.
The AIF highlighted a surge in interest for strategic projects – from Ethiopia’s new Bishoftu Airport to Zambia’s Lobito Corridor railway – demonstrating growing global appetite for bankable African infrastructure.
In Tanzania’s case, upgraded roads, ports and railways could unlock value far beyond transport.
The Dar–Mwanza SGR is poised to become a critical artery for minerals from DRC, Burundi and Rwanda; agricultural exports from the Lake Zone; and industrial goods from Dar es Salaam. The corridor would also solidify Tanzania’s position as the backbone of East Africa’s emerging mining supply chain.
Kenya’s energy investments, on the other hand, target a reliable and affordable electricity supply – a precondition for expanding manufacturing, digital services, green mobility and the country’s ambitious climate commitments.
The AfDB and its partners say they are prioritising projects with strong economic multipliers.
The Lauca–Kolwezi transmission line, for example, will power mining centres in DRC, while new energy-transmission credit guarantees backed by the DBSA and AfDB aim to raise US$ 300 million for regional power grids.
For East Africa, the stakes are high. With global financiers increasingly selective, countries able to present bankable, well-structured infrastructure projects stand the best chance of attracting sustained capital. Tanzania and Kenya now appear determined to position themselves as top destinations. If the loans advance as expected, the region could see the most significant wave of infrastructure investment in over a decade – laying the foundation for faster trade integration, manufacturing growth and long-term economic resilience.
