Business Times (Dar es Salaam)
Lupakisyo Peter
11 April 2003
THE spice industry should be recognized as a distinct sector with a high fast track export potential requiring only low levels of investment, says the Board of External Trade(BET).
A spices Export Development strategy prepared by BET of November 2002 came up with four strategic objectives to rescue the spice sector in the country.
Among them are the creation of an adequate institutional structure for sector leadership, increasing the capacity of the sector to meet technical requirements of the market and accelerated expansion of the industry.
Achieving recognition for the sector being the major strategic objective, BET discovered that this strategy is paramount because the perceived underlying problem would appear to be the awareness and recognition of the spice industry as a significant sector with a tremendous export potential.
To improve the spice sector, BET tends to create and establish an appropriate institutional frame work for the sector to enable it realise its full potential. It takes full advantage of the private and public sector smart partnership.
According to BET, this strategy can only work out if there would be establishment of the Tanzania Spice Producers and Exporters Association (TSPEA) and designation of the research and development responsibility to existing research institutions particularly to support small holder producers.
Under increasing the capacity to meet the technical requirement of the market, the board suggested that Tanzania has to improve its reputation by being a quality supplier in world markets. This is because the country has a good opportunity of capturing markets within Africa and overseas.
BET mentioned some markets that Tanzania can benefit from as the regional markets. These are the East African Community (EAC), Southern Africa Development Community (SADC) and Common Market for Eastern and Southern Africa (COMESA).
Furthermore, in the expanding European Union, Tanzania has tariff free market entry under the Everything But Arms (EBA) arrangement and the huge US market preferential treatment under the African Growth and Opportunity Act(AGOA) which Tanzania has now fully ratified.
To acquire success in the strategic objectives, the board is expected to involve the ministry of Agriculture and Food Security and Tanzania Investment Centre in order to mobilize and encourage both foreign and local investment.
Until now, the spice industry presents a major opportunity for Tanzania to exploit and reap economic benefits in the relatively short term with only a nominal input of resources and attention.
Among opportunities the sector development has are the thousands of small farmers that are already knowledgeable about spices. Thus training would not start from scratch.
Others are the exchange rate and trade regimes that are liberalised. There is a growing market for derived products such as extracts and oleoresins.
The world market for spices and herbs is valued at over USD 2.3 billion. From 1995 to 1999 imports averaged 500,000 tonnes growing at an average of 8.5 percent a year.
Contrary to the opportunities, the sector faces some threats like Tanzania spices not being branded. Further the majority of the products have no system for demonstrating trace - ability and the poor image of Tanzania as a source of supply needs urgent reversal.
Major exporters of pepper in the world are India, Indonesia and Malaysia. These have formed a pepper community to promote, coordinate and harmonise activities of their pepper industries.
The aim is to maximize their economic benefits. Hence Tanzania must act promptly to ensure its reputation as a supplier under AGOA.
Currently Tanzania has been producing a lot of spices. These include cardamom, ginger, turmeric, cinnamon, garlic, black pepper, cloves, chilli, onions, vanilla, cumin, coriander, paprika, mustard, spring onions and nutmeg.
Production of spices in Tanzania is mainly carried out in areas with tropical and subtropical climate. Normally no chemical fertilizers are used in growing them.
Available data of the spice industry sector indicate that overall the sector has been growing by more than ten percent per annum in value terms since 1997. The actual export value grew from US$ 1,148,000 in 1997 to US$ 11,000,000 in 2001.
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