Tanzania: Dar Attracts 30trl- Projects in Three Years
By Special Correspondent, DAR ES SALAAM – INVESTORS’ confidence in Tanzania as an investment hub of choice is intensifying with latest figures showing that a total of 905 projects with a combined value of US $13.2 billion (about 30.4trl/-), were registered during the past three years.
Tanzania continues to be the leading destination for Foreign Direct Investments (FDIs) among member states of the East African Community (EAC), accounting for about 40 per cent of all the investments in the bloc that were received in 2017, according to the World Investment Report (WIR), 2018.
The annual report by the United Nations Conference on Trade and Development (UNCTAD), showed that Tanzania registered FDIs projects worth US $1.2 billion (about 2.7trl/-) last year, followed by Uganda which bagged US $700 million (about 1.6trl/-) while Kenya came third US $672 million (about 1.5trl/-).
And, speaking at a news conference in Dar es Salaam yesterday, the Executive Director of Tanzania Investment Centre (TIC), Mr Godfrey Mwambe, said the 905 projects were registered between 2015 and 2018.
Mr. Mwambe, who was briefing journalists on achievements registered during the past three years under President John Magufuli, attributed the new projects to increasingly confidence by foreign and local investors on Tanzania’s macroeconomic stability, good governance and favourable investment climate.
During the period under review, 319 of the projects were registered by foreigners, 307 were fronted by local investors while 277 investment projects were through partnerships between foreign and local investors.
China remains the leading country with registered investment projects in Tanzania with a total of 723 projects between 1990 and this year. Dar es Salaam is the leading recipient of the projects at 59 per cent.
The TIC boss explained further that the lion’s share of the registered projects during the past three years standing at 478, are proposals to establish industries in various parts of the country.
President Magufuli has on various occasions stressed on setting up of factories for value addition of locally produced raw materials, mostly agricultural produce, as the country strives to achieve the target of becoming a middle-income industrialized economy by the year 2025.
Apart from value addition, local processing of raw material will create direct and indirect job opportunities for Tanzanians and also enable the country acquire technology transfer which is crucial for sustainable industrial economy.
For a project to be registered by TIC, which offers a number of initiatives, it should be worth US $500,000 (about 1.150bn/-) for foreigners and US $100,000 (about 230m/-) for local investors.
As part of facilitating investments in Tanzania, TIC has set up a One Stop Facilitation Centre where responsible government institutions work under one-roof to provide required services.
The institutions include the Tanzania Bureau of Standards (TBS), Tanzania Revenue Authority (TRA), Business Registration and Licensing Authority (BRELA), the Immigration Department as well as the Labour Division in the Prime Minister’s Office.
Also on the list are National Environment Management Council (NEMC), Tanzania Food and Drugs Authority (TFDA), Occupational Safety and Health Authority (OSHA), National Identification Authority (NIDA) and Tanzania Electric Supply Company (TANESCO).
According to WIR 2018, which was launched at the World Investment Forum (WIF) in Geneva, Switzerland, both East Africa and the Horn of Africa, which have emerged as the fastest growing FDI destination on the continent, registered a total of US $7.6 billion in foreign investments last year.
Rwanda was in the fourth slot in the EAC with FDIs worth US $366 million followed by South Sudan at US $80 million as Burundi tailed the list with only US $300,000.
According to the WIR report, Tanzania’s strong FDIs inflow is backed by strong gold prices and a diversified productive structure, including expansion by Facebook, Uber and India’s Bharti Airtel.
The report showed further that globally, FDIs flow declined by 23 per cent in 2017 to US $1.43 trillion from US $1.87 trillion which was registered in 2016. On the other hand, the World Bank forecasts that economic growth in Tanzania would edge up to at least 6.8 per cent in 2018, as inflation eases.
According to the Bretton Woods institution’s Global Economic Prospect report launched early this year, the global economic growth will go up to 3.1 per cent in 2018.
The bank noted also that growth in Sub-Saharan Africa is projected to continue to rise to 3.2 per cent in 2018 and to 3.5 per cent in 2019, on the back of firming commodity prices and gradually strengthening domestic demand.
Latest report by the Bank of Tanzania (BoT) showed that economic activities continued to expand solidly in the third quarter of 2018. “Credit growth strengthened further in August, fuelled by a jump in personal loans and a significant acceleration in credit extension to the manufacturing sector.
“While exports remained broadly stable, imports expanded significantly having been boosted by surging purchases of capital goods from abroad due to soaring infrastructure spending,” the central bank said in the report.
The BoT was also buoyant that next year; the economy should continue to expand solidly, supported by sustained infrastructure spending and growth within the services sector on the back of growing tourist inflows.
