Dorothy Nakaweesi
23 September 2008
Tanzania is cautiously opening its doors to businesses from within the East Africa having been conservatively protective even as the rest of region moved into integration eight years ago.
The move is a far cry from three years ago when Tanzania reportedly expelled some six Kenyan journalists working in the country ostensibly for breaching labour laws.
The move is a welcome gesture that demonstrates the country's willingness to fully embrace the economic integration of the region where it has often been seen to be lukewarm. "Tanzania is ready to do business with you; our doors are wide open and we want to seriously trade and investment," Tanzania's East African Affairs Minister Mr Diodorus Kamala told Business Power recently in Kampala.
Kenya Commercial Bank, Simba Telecom, and Mukwano Group are some of the businesses that ventured into Tanzania a few years ago and failed to make any meaningful business because of restriction imposed on foreign businesses by Tanzania.
Early this year, when the Safaricom Initial Public Offer was launched across the region, Tanzania stopped its citizens from participating in the IPO of East Africa's most profitable company citing concerns on the exchange rate. It also launched the country's largest IPO in the National Micro Finance Bank but restricted it to only Tanzanian citizens.
Uganda and Kenyan-based businesses have already taken a greater leap in establishing a regional presence to underscore their readiness for the competition with such firms like retail trader Uchumi, Bidco, Sameer Agricultural and Livestock Ltd, Mukwano Industries, Simba Telecom and Zain among others.
But as the country finds itself lagging behind the rest of the region in trade terms, it is making a deliberate campaign to attract investments and trade opportunities from its neighbours. "Tanzania has been exporting and trading more with other countries outside EA but now it's high time we start doing business together as a region," Mr Kamala said.
"The East Africa Trade report of 2007 shows that trade between Tanzania and Uganda has been increasing overtime but we are not utilising fully the opportunities we have under the East African Customs Union," he said.
As per the 2007 records, Tanzania's imports from Uganda increased from $5.4 million (Shs8.9 billion) to $6.5 million (Shs10.7 billion) with cement taking the major shares of items imported.
Exports to Uganda from Tanzania recorded a marginal decline to $20.3 million (Shs33.4 billion) from $20.6 million (Shs33.9 billion) in 2006. There was an increase in re-exports to Uganda by 11.4 per cent from $23.1 million (Shs38.1 billion) in 2006 to $25.7 million (Shs42.4 billion) in 2007.
Mr Kamala said Tanzania wants to expand trading activities to the D.R. Congo, South Sudan, Rwanda and Burundi. He however said in order to accomplish the economic development of the region collective effort has to be enforced between the governments of the member states in collaboration with the private sector.
"If we create a consortium of investors who will exploit and develop the different fields the region, we will reduce on the over dependency on the importation of raw materials from outside the region and in this our people will retain the jobs and poverty will be reduced," he said. He expressed his disappointment over the huge bills East Africa member states spend on importing iron ore, for instance, yet Tanzania has huge deposits which are not untapped because there are no investors to exploit it.
Uganda's Investment Minister Ssemakula Kiwanuka decried the never ending challenge of infrastructure which is pushing regional development behind. "We cannot trade amongst ourselves because we are not linked. Even with the presence of Lake Victoria as a potential cheaper highway that links Uganda, Tanzania and Kenya, has not been exploited," he said.
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