East African Cooperation minister Samuel Sitta has underscored the need for the government to review the current Capital Markets and Securities Act to enable Tanzanians to invest in the region’s partner states.
The Minister said it is irking to see Tanzanians barred from investing in other partner states while Kenyans, Rwandans, Burundians and Ugandans are freely investing in the bloc’s second largest economy.
He made the remarks in Dar es Salaam yesterday when launching the National Committee on Common Market Implementation Protocol.
The current Capital Markets and Securities Act was enacted in 1994.
The committee will, among other things, will oversee implementation of sectoral strategies, identify market challenges and advise the Tanzanian government on the best ways to tackle them.
The committee comprises members from different ministries, office of the Attorney General, Bank of Tanzania (BoT), Tanzania Revenue Authority (TRA) and the Immigration Department.
Other members are from the National Bureau of Statistics (NBS), Tanzania Private Sector Foundation (TPSF) and Tanzania Chamber of Commerce Industry and Agriculture (TCCIA).
“It is annoying to see Tanzanians prohibited to invest in the EAC partner states, while neighbouring Kenyan lead in investing in our country…the national committee should come up with a proposal to promote equity,” he noted.
According to him, Tanzanians are yet to benefit from the community because of several reasons, including absence of manufacturing industries to enable Tanzanians to sell value added products.
Giving examples, the minister said that fruits and maize from Tanzania are cheaply sold in Kenya and processed before they are labelled and exported to overseas markets.
He said to curb the situation, they have proposed for establishment of special markets at near the boarders so that foreigners can purchase Tanzanian goods through auctions instead of current practice where producers sell their produce at cheap prices.
Sitta said the markets will be constructed in the coming financial year. He said the government is also working on a plan to allow free immigration of people living near the boarders in order to strengthen relations among peoples in the region.
The plan, he said, will only be applicable for residents living within 30 kms from the boarders of each state.
Residents in the respective areas will be provided with temporary passports to allow the planned regular interactions, he said.
Presenting a paper on EAC integration in the context of the realities of globalisation and the economies of the bloc’s partner states during the EAC-Vision Group conference last year, former East African Community secretary general, Ambassador Juma Mwapachu underscored the need for the government to allow Tanzanians to purchase shares in private and public firms in the bloc’s partner states.
He said that was one of the surest ways of promoting and consolidating economic integration in the region.
There was no reason for the government, through the Bank of Tanzania, to bar nationals from investing in foreign stock exchange markets for the fear of capital flight.
He noted that the International Monetary Fund had indeed previously imposed such a condition over fears of capital flight, but now the barrier needlessly denies people investment opportunities.