Finance and Economic Affairs minister Mustafa Mkulo has played down the Dutch Government's intention to suspend aid to Tanzania. A Dutch minister was infuriated by "mistreatment" of his countryman who is involved in a timber business and asked his Parliament to suspend aid.
Mr Mkulo toldo The Citizen yesterday it was unfortunate that the country was basing its case on events involving only one businessman.
He said the Government had formally been informed of the Netherlands' decision and that several consultation meetings were held on the issue with no amicable agreement.
Dutch Development minister Bert Koenders wrote to the Lower House in his country, explaining that Tanzania was an unreliable partner for foreign investors. The minister took the decision after an unnamed Dutch businessman lost his investment in Tanzania.
However, the letter neither names the businessman nor gives details of the case, but the minister said "enough is enough". The bilateral budget for Tanzania for 2009 is 81 million euros (Sh148.2 billion).
This consists of 30 million euros for general budget support, 21 million euros for health care (including the programme for combating HIV/Aids), 18 million euros for good governance (decentralisation), 10 million euros for drinking water and sanitation and 1.1 million euros for improving the business climate.
The Netherlands' aid in 2008 totalled 69.7 million euros (Sh127.5 billion according to current exchange rates). The aid was directed towards health care, local government and private sector development.
Mr Mkulo told The Citizen yesterday that there was a Dutch businessman who wanted to be given special treatment.
"The Dutch was engaged in logging business, he was conducting his business from Mkumbara. He was a private businessman but there was a lot of interventions by his embassy," Mr Mkulo said.
He said the businessman had sought to meet Prime Minister Mizengo Pinda in his quest to be given special treatment in his business. But he was asked to contact Natural Resources and Tourism minister Shamsa Mwangunga instead.
When the businessman met the minister, he was directed to conduct his business in accordance with the laws and regulations, but he refused and forwarded the matter to his embassy.
"But it is diplomatically understood across the world that there is no country which is allowed to intervene in internal affairs of another country.
If, for instance UK sets its own regulation to remove hawkers in London, Tanzania cannot intervene simply because Tanzania hawkers are going to be affected... it is against the Geneva Convention,"explained Mr Mkulo without naming the businessman.
He said he had met the Dutch envoy and discussed the matter without knowledge that the businessman had gone to the Prime Minister on the same matter. Mr Mkulo referred this paper to Ms Mwangunga for further clarification but her phone was switched off.
The permanent secretary in the Ministry of Tourism and Natural Resources, Dr Ladislaus Komba, said he was unaware of the issue. But Tanzania is not the only country which has suffered Dutch aid freeze.
Mr Koenders named other countries which will miss aid from the Netherlands as Bosnia-Herzegovina, Albania, Armenia and Macedonia because they were receiving more funds from other sources.
Also affected are Eritrea and Sri Lanka for political turmoil, while Cape Verde will also miss Dutch aid on the grounds that its economy was performing well, the minister said in his letter.
The Netherlands each year spends 0.8 per cent of its gross domestic product on fight ingpoverty with half of the aid going to Africa.
In 36 countries it supports, the money is spent on improving governance, human rights and business opportunities.
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Dear Sir, Madam,
Your article seems to suggest that the dutch government was persuaded by one - unnamed - businessman on false grounds to suspend government aid to Tanzania.
This seems very unlikely to me for a couple of reasons; first - as you righly mention in your article - the dutch have quite a record on foreign aid, it's one of the few country's that are keeping the old international standard of 0,7% of GDP for these purposes. The minister announced that he would suspend the general program directed at the Tanzanian budget deficit. The support schemes for welfare and healthcare were not mentioned.
Secondly it is highly improbable that one businessman is capable of influencing the dutch government. In a report on corruption the ministry of foreign aid ordered, the business climate in Tanzania is shown to deteriorate due to corruption. True or not it's a very dangerous sign for every economy.
It would therefore have been reassuring if the tanzanian government would have said that i would look deeper into the matter. The prompt reaction that the dutch government was misinformed or mislead by just one dissapointed businesman sadly enough gives me the feeling that the government of Tanzania is spoiling the good name Tanzania had/ has in the field of corruption in africa.
On top of that, i'm sorry to say, it would have been good journalism to investigate the matter or to get an official response from the dutch embassy in Dar es Salaam. Copying the statement of the - accused - Tanzanian government does not help to clarify the situation.
Quite so to the previous comment but then to be fair thearticle wasprinted in an IPP Media publication the CEO of which is Reginald Mengi brother Benjamin Mengi involvedwith the infamous Silverdale Case in Tanzania which is causing British M.P. Roger Gale to suspend British Aid to Tanzania. (see below).
I applaud the decision of the Dutch government to suspend aid to Tanzania.
The reality of the situation in Tanzania is simply that the rule of law does not exist with any consistency or in a manner that affords existing or potential investors in Tanzania with any tangible security for their investment. The message clearly is that if you want to invest in Tanzania be warned that the risks are high.
The Investment Guide to Tanzania produced in 2005 is a pristine publication produced with the clear intention of enticing foreign investment into the country. It sets out the opportunities and conditions prevailing in Tanzania for investors. It states that the rule of law is well established and the level of security relatively high. However, relative to what one has to ask. Wide spread corruption in the Police, Judiciary and Co-operative administrations (who in the main govern the agriculture sector by way of carving out sub-leases from head leases granted to them by the government) in Tanzania is perhaps the single most negative element fettering foreign investment and development in the country and adversely affecting the lives of Tanzanian citizens.
It is the issue of security in Tanzania that perhaps poses the most serious concern for the foreign investor in Tanzania together with, the overt and arbitrary use and abuse of the rule of law, judicial administrations and the Police. Many regional and district administrations are also corrupt and it would be foolish for any investor to overlook these very serious issues. Under no circumstances, can any investor (or citizen for that matter) presently rely on either the police or the judiciary for any consistent protection against harassment and abuse from those who seek to ignore Tanzanias investment policy and interfere with investors.
It is true, that Tanzania has a comprehensive Civil and Penal code. However, in more cases than is comfortable, these are not followed and justice is delivered on a wholly arbitrarily basis. The bottom line is, Tanzania cannot at this moment in time guarantee the personal safety of any investor or his investment. Is Tanzania therefore a bad place to invest? Well maybe not per se but for sure, the Investment Guide to Tanzania should carry a government health warning, caveat emptor, this is Africa!
British M.P. Roger Gale (is also calling for the suspension of aid to Tanzania again, for the abuse of investors Sarah Hermitage and Stewart Middleton and their Tanzanian staff who were forced from Tanzania in 2008 with the loss of their entire investment. The details of this case may be read at:-
http://www.theyworkforyou.com/whall/?id=2008-02-27b.272.0
The Tanzanian government should put away their begging bowl until they can appreciate and adhere to the reality and not simply the rhetoric of good governance!!!
While I agree with some of the comments above, I need to also point out that most of the foreign investors come to our countries expecting to be treated like kings. In most cases, they demand to meet the President of the country on very trivial and procedural matters. If they are denied meetings with the country President, or Prime Minister they start complaining of unfair treatment. What you people should remember is that most of those leaders in Africa have been to your countries, and even when on official business, have been treated like dirty right from the time they need to make migration clearance. I am an African. I have been a victim of such ill treatment a number of times in Europe and other countries. Regardless of what credentials I had or showed, regardless of the fact that it was just not possible to the least intelligent of your migration officers that I was one of those seeking to migrate to the country to seek economic opportunities, I was still treated as an unwanted visitor. I have to admit a number of times I wished I would have an opportunity to reciprocate your "hospitality". Those are the only times I have wished I were President of my country, just to command my ambassadors in your countries to document any incidents of mistreatment of my people and summon your ambassadors in my country to Statehouse every time one of my people was mistreated in your country until you learned something about treating people with respect, at least my people. Sometimes I despise my own fellow people, leaders, ambassadors for paying a blind eye to this. Many times I just wish I had the chance, just to give you a taste of your own medicine, investment promotion policy existing or not. What I am trying to say here is that there are so many government officials in Africa with personal grudges against you because of the way you treated them when they came to your countries. They will do all they can to facilitate things for you as an investor, within the government investment policy framework, but you should just forget thinking they will run an extra mile simply because you are coming in as a foreign investor. I have the same mentality, and this is thanks to the way you treat me when I visit your countries. We might need your investment, but you first need to learn how to treat people with respect, poor or rich, white or black. These are the people you will be dealing with on a day to day basis when you go to their countries, not the President or some lengthy document called national investment promotion framework. People in Africa do not have the same avenue of complaining to their Ministers or embassies when they are ill treated in your countries, they wait for their opportunities to reciprocate. They are patient and they can wait for years. When they get such opportunities, patriotism is the last thing they have in mind.