East African Business Week (Kampala)
Edris Kisambira
22 October 2007
Kampala — Tanzania outperformed her East African Community (EAC) member states in attracting Foreign Direct Investment (FDI) courtesy of its booming mining sector.
Figures from the latest World Investment Report 2007, which tracks the 2006 performance indicate that Tanzania managed FDI amounting to US$377 million, 25% higher than Uganda because of huge inflows into the mining sector.
Regionally, Uganda came in second with FDI values of US$307 million, a 19% growth if compared to 2005 figures. Burundi did so well with estimates putting inflows at $290 million while Rwanda estimates put it at $15 million.
Kenya's inflows were much lower at $51 million but the plus is Kenya registered FDI outflows valued at $24 million with none of the other EAC members registering any outflows.
Out of the $36 billion (a new record level) that Africa attracted in terms of FDI as a continent, East Africa accounted for a paltry $1.04 billion.
However, the report put both Uganda and Tanzania among the top 10 major recipients of FDI in Africa. In declining order they include Sudan, Equatorial Guinea, Chad, Tanzania, Ethiopia, Zambia, Uganda, Burundi, Madagascar and Mali.
The report notes that of the $36 billion worth of FDI inflows, more than half of those investments have gone into the extractive industries.
The report also noted that Transnational Corporations (TNCs) in the telecommunications sector have also started to invest in least developed countries (LDCs) with Uganda having licensed two new players.
Uganda's 19% jump in FDI inflows from $257 million in 2005 to $307 million in 2006 was partly a result of investments from Australia in the oil industry. ther notable sources of FDI for Uganda were recorded from Egypt, India, Kenya, South Africa and the United States
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