Embezzled aid call-back from Tanzania

The Netherlands is demanding that Tanzania pay back € 25,000 that had been part of a grant, but was misused in the east African nation. Financieel Dagblad reports today that civil servants used the money to “purchase expensive vehicles and for excessive per diems”. The Foreign Ministry has confirmed the claim.

The Netherlands is not the only donor country demanding money back; Belgium, Finland, Sweden, Ireland, Germany and Japan are also filing for refund; € 255,000 in total. Between 2009 and 2012 the countries had donated money for a program aimed at institutional improvements of the service provided by the Tanzanian Government; the Netherlands contributed €30.5 million to the program that was scheduled to run until June next year.

The “mismanagement and possible embezzlement” were unearthed when one of the donor countries carried out a regular an inquiry. Foreign Affairs said the Tanzanian Government has since suspended several civil servants; the government has also taken measures “to improve its financial management.” The initial project will likely not be resumed however.

Foreign Affairs said that the Netherlands will be terminating the bilateral development relationship with Tanzania this year. The Ministry insisted that this has nothing to do with the embezzlement. “The decision to end the 40-year-old assistance relationship is the result of the belief that some development countries could benefit more from trade than development aid,” Financieel Dagblad quoted the Ministry. The Netherlands is a major investor in Tanzania, only second to the UK.