Govt draws up strategy to fast track industrialisation agenda

28Nov 2017
The Guardian
Govt draws up strategy to fast track industrialisation agenda
  • • According to the Permanent Secretary in the Ministry of Industry, Trade and Investment, Prof Elisante Ole Gabriel, the recently crafted blueprint seeks to synchronize the various industrial plans and policies Tanzania has had for better results

The government has drafted a national strategy to help direct its efforts to make Tanzania an industrial economy by mid next decade, a senior technocrat in the Ministry of Industry, Trade and Investment has said.

The Permanent Secretary in the Ministry of Industry, Trade and Investment, Prof Elisante Ole Gabriel. File photo

According to Permanent Secretary Prof Elisante Ole Gabriel, the recently crafted blueprint is for fast tracking the industrialisation agenda of the fifth phase government. He recently told Smart Money that principally the new strategy seeks to synchronize the various industrial plans and policies Tanzania has had for better results.

Dubbed Strategy for Fast Tracking Industrialisation in Tanzania, the blueprint is a comprehensive industrial development game plan that addresses past mistakes and failures, builds on previous achievements and sets tangible targets based on clearly defined priorities.

“Tanzania already has an industrialization policy document in place and not only that but it also has many policies and strategies being implemented for driving the industrialisation agenda such as the Sustainable Industrial Development Policy that was developed in 1997 and the Integrated Industrial Development Strategy of 2011,” Prof Ole Gabriel said.

“We also have the Second Five-Year Development Plan, which is our major tool in the industrialization process but more importantly is the strategy that we have recently developed which is dubbed as Strategy for Fast Tracking Industrialisation in Tanzania,” he added noting that it combines almost all the policies and strategies Tanzania has had in the past.

Speaking on the sidelines of the 2nd East African Business and Entrepreneurship Conference and Exhibition, which was held in Dar es Salaam mid this month, Prof Ole Gabriel also said that the new blueprint categorizes the industrialisation agenda in terms of priorities, sectoral development and project implementation.

Themed “Accelerating Industrialisation, Innovation and Investment in the EAC region” the three-day event was organised by the East African Business Council.

Several stakeholders used the occasion to outline what Tanzania should do to fast track the industrialization agenda, retain investors and lure new ones, remain competitive and become an economic powerhouse in Africa. According to them, the government should ensure a consistent policy regime for that to happen and invest adequately to improve infrastructure and energy efficiency.

Equally important, they add, is readily availability of skilled manpower, creation of a conducive environment for investment, and boosting of agriculture productivity. The experts also want economic processing zones and special economic zones in the country to be strengthened and increased.

Anything short of that, they argue, the agenda of making Tanzania an industrial economy will falter. They believe that promotion of local manufactured goods and linking of the manufacturing sector to the East African market and the rest of the world would help in fast tracking industrialization in Tanzania.

Confederation of Tanzania Industries (CTI) Chairman Dr Samuel Nyantahe said key factors for Tanzania’s industrialization and socioeconomic transformation include a motivated business community and a business friendly government. According to him, resource mobilisation to propel industrial growth requires proper planning and allocation rather than distributing them to many activities and investing in consumption that has little economic value.

“Industrialization in Tanzania is impossible without commercialization of agriculture and agro industries because of the importance of the sector in terms of its contribution to GDP, the country’s foreign exchange earnings, its contribution to food security and therefore industrial labour costs, its contribution to job creation and its importance as both supplier and market for industrial production,” Dr Nyantahe told Smart Money during the 2nd East African Business and Entrepreneurship Conference and Exhibition.

“Financial considerations are paramount if industrialization is to be successful in Tanzania. The implementation of the industrialization programme needs financial resources and if not carefully planned there is likely to be a gap between the financial requirements and the available resources. There is therefore a need to establish a resource envelop which shows the resources requirement, available resources, resource gap and financing strategy” he added.

Dr Nyantahe affirmed that Tanzania’s industrialization dream cannot be realised without an industrial development bank, a national investment fund and a bank for general enterprises. He also said that it requires existence of a financial institution for farmers, which is already there in Tanzania Agricultural Development Bank that was established in 2015.

He asserted that smuggling of goods into the country should be curbed by all means in order to create a fairly competitive platform. CTI has been on the forefront in supporting the government’s industrialisation endeavour through various initiatives, including drafting position papers on what should be done to industrialise the economy.

For example, in May 2016, the lobby group prepared a paper that suggested key issues to be observed by the government in fast tracking industrialization in the country. According to Dr Nyantahe, some of the submitted recommendations have been embraced such as revival of the rail system and construction of roads.

“We recommended that Tanzania Port Authority (TPA) should use ICT in cargo clearing, called for expansion of berths at the port and procurement of loading and offloading equipment, which the government has to some extent done. We also advised that Tanesco’s capacity in supplying power has to be increased, especially in rural areas and so far the government has shown some interest on that area,” he noted adding that the issue of unpredictable policies and sufficient energy supply are still a big challenge.

In another interview, Prof Michael Ndanshau from the Department of Economics at the University of Dar es Salaam called for strengthening of Special Economic Zones and Economic Processing Zones as well as the increase in their number. He challenged the government to empower the Special Economic Processing Zones Authority so that investors wishing to invest in the country can be assured of enough industrial parks.

The don also decried unfair competition especially in the country’s manufacturing sector which he largely attributed to corruption. Prof Ndanshau lauded efforts being made by the government under President John Magufuli in fighting the vice.

According to him, more efforts are needed to protect local industries from unfair competition especially that coming from cheap imports that are smuggled into the country without being taxed.

Like most of his peers, Prof Ndanshau also said that for the industrialization agenda to be fully realised, the government should enhance power generation and ensure reliability of power supply. He recommended cutting of power tariffs for industrial users, reduction of charges for natural gas used for industrial power generation and speeding up of rural electrification to attract industrial investments.

On his part, the Executive Director of Tanzania Private Sector Foundation (TPSF), Godfrey Simbeye, said success of industrialization requires creation of a conducive business climate for the private sector to thrive. According to him, private sector investment is a pivotal aspect in building an industrial economy like the one Tanzania is aspiring for.

“Since we are the ones who will establish most of these industries, we need a predictable policy environment that is conducive to attract investors. Therefore, one of the roles of TPSF is to ensure the government set policies that support entrepreneurship,” Simbeye said.