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Friday, February 8, 2008 : 1605 Hrs


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    Tanzania's Cabinet dissolved after PM, Energy Minister resign

    Dar Es Salaam (Tanzania) (AP): Tanzania's Prime Minister and two Cabinet Ministers have resigned over a corruption scandal involving a contract with a nonexistent firm supposed to be based in the United States, and the president dissolved the entire Cabinet as a result.

    The upset comes the week before US President George W Bush is to visit, considered a sign of approval for a government. More than half of Tanzania's budget comes from foreign aid.

    "I have written to the president to relieve me of my duties after serving the government for two years," Prime Minister Edward Lowassa told parliament on Thursday in Dodoma, 400 kilometres north of Dar es Salaam.

    Energy Minister Nazir Karamagi and East African Cooperation Minister Idrissa Msabaha, also resigned. Msabaha was energy minister at the time the government was negotiating a contract with Texas-based Richmond Development Corp. LLC.

    President Jakaya Kikwete dissolved his entire Cabinet, according to a government statement issued late Thursday.

    Lowassa's letter said that he was wrongly implicated and never was given a chance to explain.

    The resignations follow Wednesday's highly critical report by a parliamentary committee into a contract awarded to Richmond Development to supply emergency power about two years ago.

    A contract of USD 172.5 million was signed to supply the government with 100 megawatts of emergency power when drought hit Tanzania's hydroelectric dams. But generators arrived faulty and late, or not at all.


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