Tanzania is at home with the Scania initiative

24Mar 2020
The Guardian
Tanzania is at home with the Scania initiative

Scania is a global company, offering sales and services in more than 100 countries. Scania is also a major Swedish manufacturer of commercial vehicles – specifically heavy trucks and buses. It also manufactures diesel engines for heavy vehicles as well as marine and general industrial applications.

Scania was formed in 1911. Today, Scania has production facilities in Sweden, France, the Netherlands, India, Argentina, Brazil, Poland, Russia and Finland In addition, there are assembly plants in ten countries in Africa, Asia and Europe. Scania's sales and service organisation and finance companies are worldwide. In 2012, the company employed approximately 42,100 people around the world.

The government has welcomed the Swedish truck conglomerate—Scania to establish a multi-million dollar assembly plant in Tanzania as the company takes advantage of Tanzania’s high-quality natural gas.

Minister of State in the Prime Minister's Office (Investment), Angellah Kairuki, confirmed in Dar es Salaam that she had recently talked with Scania managing director Lars Eklund on the issue.

We welcome that investment initiative from Scania. We expect the proposed plant will be a huge investment project, the kind of projects we need in East Africa. With this investment in the pipeline we hope the government, shall continue to improve the business environment in order to attract foreign investment inflows and consolidate the gains on our industrialisation agenda.

We commend the government’s positive on the Scania initiative because a successful multi-billion project of that nature would create jobs for Tanzanians, introduce new technologies and increase government revenues for our country’s socio-economic development in realizing the middle class economy come 2025.

The Tanzania Investment Centre (TIC) which was established in 1997 by the Tanzania Investment Act to be ‘the Primary Agency of the Government to coordinate, encourage, promote and facilitate investment in Tanzania and to advise the government on investment policy and related matters , we believe that the agency will creating and maintaining a positive climate for private sector and foreign investments in the country.

As we are told that the agency deals with all enterprises whose minimum capital investment is not less than US $ 500,000 if foreign owned or US $ 100,000 if locally owned. Enterprises engaged in mining and petroleum should follow the approval process contained in their respective laws. The agency is duty bound to assist all investors to obtain permits, authorisation as required by other laws to set up and operate investments in Tanzania accordingly.

Given that among other TIC’s functions include; providing advice to the government on investment related matters and stimulating local and foreign investments.

We also call upon the TIC support to the prospective investor in cooperation with the government as the ministry’s job is to expose investment opportunities and attractions so that we can achieve comfortably the country’s vision of making Tanzania a middle-income industrial country by 2025.

We are happy that Eklund has appreciated the conducive investment climate prevailing in Tanzania, but said besides the good investment environment, natural gas was an important raw material in running buses that use diesel or CNG gas.

The abundant natural gas found in Tanzania was one of the important considerations in making Scania arriveg at their decision decision because for a long time they had been using gas to run their buses. Tanzania has three categories of investors. Ordinary foreign investor is one who invests not less than 100,000 US dollars.

Category two accommodates an investor who brings into the country not less than 50,000,000 dollars and top-level investor invests not less than 300,000,000 dollars.

Sweden was not among the top ten investors in Tanzania in a period between 1990 and 2018. The group members are China, UK, USA, Mauritius, India, Australia, Kenya, Netherlands, Belgium and Egypt. The group has collectively 3,173 projects employing 549,770 people and the projects have a total value of 29,120.36 US million dollars.

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