Tanzania eyes AfCFTA zone as 7trn/- seeps into industries

07May 2022
Songa wa Songa
The Guardian
Tanzania eyes AfCFTA zone as 7trn/- seeps into industries

TANZANIA is investing upwards of $3bn (6.9trn/-) in strategic manufacturing aimed at making the country top supplier of industrial goods within the African Continental Free Trade Area (AfCFTA) before the end of the decade.

Dr Ashatu Kijaji, the minister for Investment, Industry and Trade.

Dr Ashatu Kijaji, the minister for Investment, Industry and Trade unveiled the plan in the National Assembly yesterday while tabling the ministry’s budget estimates for the 2022/23 financial year.

The country’s ambitious investment programme seeks to put up 500 new large industries, whose employment results are likely to be substantial even by 2025, bringing the total large industry projects to 541 including those lined up for implementation at present.

“The target is realistic and achievable going by investments being registered at the Tanzania Investment Centre (TIC) and Economic Processing Zones Authority (EPZA),” she said, noting that the government has embarked on setting up the Kwala Industrial Park which will hold 200 industries.

Their production lines include textiles, electronics, construction materials and pharmaceuticals, she stated, elaborating that the first phase is scheduled for 2024 and create 100,000 direct jobs and 300,000 indirect occupation outlets.

Investment in this area is estimated at $3bn (over 6.9trn/-), potentially making Tanzania the centre of industrial production within the region and the wider African free trade area, she declared.

Other industrial investments are set for the Nala special economic zone in Dodoma, a major industrial park in Mwanza, where the projects are being pursued by the government in collaboration with the private sector, she stated.

The minister described Tanzania as registering steady growth in industrial investment, spearheaded by the private sector especially at Economic Processing Zones (EPZ) and Special Economic Zones (SEZ), beefed up by properties held by individuals.

Characterizing industrial sector activity, he said most industries are ancillary, a total of 62,400 establishments forming 77.07 per cent of total industries, 17,267 small scale factories (21.33 per cent of outlays) 684 medium scale units (0.84 per cent), and 618 large factories (0.76 per cent of total units).

Out of the 618 large factories employing at least 100 people, 41 have the capacity to hire more than 500 workers. The investment plan now seeks to have 500 such factories targeting the AfCFTA zone, by 2025.

AfCFTA is a free trade area founded in 2018 with trade commencing in January 2021, following the African Continental Free Trade Agreement inked by 54 of the 55 African Union member states.

The free-trade area is among the largest in the world for participating countries, by World Trade Organization data cited by AfCFTA officials.The traditional Pan African hub of Accra serves as the AfCFTA Secretariat, commissioned and handed over to the AU by host president Nana Akufo-Addo on August 17, 2020.

Tanzania ratified AfCFTA on 9 September 2021, the 39th country in Africa to deposit its instrument of ratification, in the wake of vast policy changes initiated by the sixth phase government.