21 May 2014

Tanzania: Grand Industrial Plan Unveiled

Dodoma — HIGHER investment costs will not hold back government's efforts in putting up new economic projects crucial for economic growth.

The Minister for Industry and Trade, Dr Abdallah Kigoda, said this in the National Assembly while tabling the ministry's 2014/2015 budget estimates.

Dr Kigoda noted, for example, that development of Special Economic Zones and Economic Processing Zones has been very expensive while its outcome in economic growth and employment creation has been significant.

The minister noted further that the Kurasini China-Tanzania Logistics Centre and Mini-Tiger Plan 2020 will cost 200bn/- but for investing that much, the country will be able to attract investments worth 17 trillion/-. The minister further noted that the government was committed to finding funds for compensation of residents at Kurasini as well as Bagamoyo, Ruvuma, Mtwara and Tanga where such investments are due to take place.

He added that the government, through the Economic Processing Zone Authority (EPZA) and local government authorities has put aside investment areas in 20 regions while efforts were underway to put in place such other areas in the newly-established regions of Simiyu, Geita, Katavi and Njombe.

He said that in 2013/2014, a total of 31 companies have been awarded licences to construct industries under EPZA, out of which eight have started production.

"The companies in question are expected to invest 458 million US dollars and employ 10,276 people. This investment increases the number of companies that have invested under EPZA to 98, with the total investment now amounting to 1.5bn/- and 27,000 direct employment opportunities," the minister told the House.

Dr Kigoda noted that preliminary work on Bagamoyo SEZ, which is located on an area covering 9,000 hectares, has begun, adding that 6,500 hectares will be developed by EPZA, which has already completed its plan and already 28 companies have been awarded licences for the construction of industries.

"Talks are underway between the Prime Minister's Office and the CMHI (China Merchants Holdings International) for investment in the Portside Industrials Zone in the 2500 hectares within Bagamoyo SEZ," he said.

The Chairman of Parliamentary Committee on Finance, Industry and Trade, Mr Luhanga Mpina, questioned small budget for the ministry in which 112.5bn/- has been set aside for the ministry's budget in the financial year 2014/2015, which includes 33.6bn/- for recurrent expenditure and 78.8bn/- for the development votes too little to meet the ministry's programmes.

"The government has set aside 60.4bn/- to pay compensations in the EPZ and SEZ investment areas, which have been evaluated instead of 117.5bn/-, in this there is a shortage of 54.13bn/-. The committee is questioning government's priorities in this," he noted.

He, therefore, urged the government to increase the budget for compensation to ensure that Bagamoyo SEZ gets 41.4bn/-, Tanga (1.2bn/- ), Songea (3.2bn/-) and Kigoma (1.5bn/-), adding that 53.4 billion/- set aside for the compensation at the China- Tanzania Logistics Centre's and 7bn/- for Bagamoyo SEZ should be paid in the first quota.

Mr Mpina also urged the government to allow the Tanzania Bureau of Standards (TBS) to start employing new staff to reduce the shortage of 517 workers.

"In the financial year 2014/15, the government should allow TBS to employ at least 200 new staff and in the financial year 2015/16 the government should allow TBS to employ 317 others.

Also, the government should set aside 3bn/- for the construction of modern laboratories for the TBS to improve its standards," he said.

The Shadow Minister for Industry and Trade, Mr David Kafulila, said that the country's economic trend was not promising, calling for more efforts to achieve vision 2025. "With only 10 years remaining to 2025, there was a target of achieving industrial production worth 16 billion US dollars.

That is to say that by now we should have reached at least 9.6 billion US dollar or 15tri/- but we are somewhere at 3tri/-. This trend is unsatisfactory and we should put much more effort," he advised.

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