13 July 2017

Tanzania: Serious Staff Shortage Bites, Laments EPZA

A shortage of staff is hampering operations of the Export Processing Zones Authority (EPZA) with failure to release the 2016 report on the performance of companies operating under its zones being the latest impact.

EPZA director general Joseph Simbakalia told BusinessWeek that the authority was seriously understaffed.

According to him, it has 29 staff compared to 68 staff who are required.

"Our work is meant to physically go to the field so that the report can resonate with the reality... we don't wait for the companies to bring us with data," noted Mr Simbakalia.

"But unfortunately the shortage of the staff is delaying the speedy delivery of the report."

He was of the view that the government should have a special department to deal with assessment and preparation of report on the performance of the companies operating under the umbrella of EPZA.

The members of the department should be on the ground to enable the fast compilation of reports at the end of the year.

"My staff are indeed overstretched as they are busy with big projects like Bagamoyo port, Kurasini and Star City Economic Zone," noted Mr Simbakalia.

BusinessWeek survey has established the EPZA's latest report is that of 2015.

Its cumulative export earnings in the year climbed to $1.1billion (about Sh2.4 trillion), up from $800 million (about Sh1.7 trillion), a year before.

Of the earnings, agro-processing, assembly and engineering accounted for 18 and 31 per cent.

Textile and apparel and mineral processing contributed to 21 and 10 per cent correspondingly.

During the period under review, this paper has learnt that investment capital stagnated at $1.3 billion (Sh2.8 trillion).

During the period under review capital was invested by 160 licensed companies, which have been operating since 2007.

Locals and foreigners accounted for 44 and 42 per cents respectively.

Joint ventures contributed to 14 per cent.

Going by the EPZA's data, during the period under review, the investment opportunities, which were established to spur processing and manufacturing of products for local and export markets have created over 36,000 jobs for Tanzanians.

Apart from the earnings and jobs, the EPZA chief pointed out that foreign investors bring to the country capital, technology and expertise to boost industrialisation.

EPZ scheme provides for the establishment of export oriented investments within the designated zones with the views of creating international competitiveness for export led economic growth.

Mr Simbakalia said Special Economic Zone (SEZ) and EPZ priority sectors are agriculture and agro-industrial, manufacturing, commercial, tourism and forestry.

Others are textile and garments, agro-processing, leather processing and manufacture of leather products and banking and financial centers, among others.

Eligibility of EPZ, according to him include, export 80 per cent of goods produced and minimum annual exports of $500,000 (about Sh1.1 billion) and $100,000 (about Sh220 million) for foreign and local investors respectively.

The eligibility of SEZ, he added, includes minimum capital of $500,000 (Sh1.1 billion) and $100,000 (about 220 million) for foreign and local investors.

The companies operating under EPZA, enjoys corporate tax for 10 years, Value Added Tax on Utilities, withholding tax on rent, dividends and interest rates.

Other incentives are import duty on capital goods and raw materials.

They are also enjoying privileged procedures on visas, work permits, transfer of profits, dividends and royalties and best and fast facilitation services through a one-stop center.

The EPZA boss called on investors to invest heavily on modern technology so that they can produce products which meet international standards.

"Investors should pull up their socks if they are to produce products which meet international standards," noted Mr Simbakalia.

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