The lead story in the Business Section of yesterday’s issue of this paper revolved around an appeal to the government to appreciate the fact that, while not yet all that developed, Tanzania’s manufacturing sector has great potential to attract large-scale foreign direct investment.
The call was based on findings of a recent study jointly conducted by the Industries and Trade ministry, National Bureau of Statistics and Confederation of Tanzania Industries of the performance of the sector between June 2008 and May 2009, with a view to help it do better.
As rightly noted in the report, most businesses owned and run by Tanzanian nationals are just too small-scale and weak in terms of both financing and expertise to graduate into bigger and more vibrant and successful enterprises.
However, all is not lost, at least in that they have great capacity to lure giant foreign investments in favourable social, political, economic and other conditions. Usually, partly owing to legal requirements, the result is stronger and more sustainable joint ventures bringing together local and foreign players.
Tanzania has relatively long experience dealing with arrangement in all manner of sectors, with the government standing by in part to ensure that no operations are in contravention of the laws of the land and care for the need to promote accountability and quality performance generally.
It is on record that laudable efforts have also been to ensure that opening the doors to foreign investors does not compromise good governance in the sense of public institutions conducting their affairs and manage public resources with their eyes on the need to safeguard and promote basic human rights.
This trend has had remarkable benefits to the nation and Tanzanians ought to feel obliged to build on it because, however true it may be that business is the engine that drives job creation and makes the economy tick, development means a lot more than economic vitality.
It is this that makes us hail the government for drawing up economic development plans part of whose thrust is on making Tanzania more investor-friendly and generally supporting local and foreign businesses based in the country but without falling into the danger of being excessively generous in the process.
We know it is hard to survive, much less know strong and meaningful social development, without noticeable growth in employment opportunities, decent wages and a brisk business sector – which, after all, are often cited as the most important attributes of a vibrant economy. But we should not aim for this goal regards of the potential costs.
This speaks in defence of the need for government and other stakeholders to come to the aid of local businesses, including small and medium enterprises, which form part of the backbone of all levels of development.
A weak manufacturing sector is a recipe for a failed economy, and this is unacceptable because it is suicidal. We all need to heed the observations in the study by the Industries and Trade ministry, NBS and CTI and take appropriate measures before it’s too late.