Tanzania A country on the march - New Africannewafricanmagazine.com/archive/images/pdfs/Tanzania/tanzania... · beyond the Kenya border. The volcanoes, all but one, ... grassland

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TanzaniaA countryon the march

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Formerly colonial “German East Africa” and later British-controlled Tanganyika, and centuries earlier part of the remarkable Land of Zinj,

Tanzania’s coastal strip, known since Biblical times to sailors and merchants from lands as distant and diverse as Arabia, Persia, India and China, was mentioned in the Periplus of the Erythrean Sea, a maritime guide written in the time of Alexander the Great.

This sweltering coast had, and still has, charms which more than compensate for its discomforts. It gave rise to the little-known but significant Swahili civilisation which flowered in the clear light of Africa while Europe stumbled out of the Dark Ages. It gave rise also to the tainted but influential Omani sultanate, era of slaves and spices, exploitation and exploration, commerce and concubines.

But more than three-and-a-half million years ago, before Sultan Said the Great fell in love with Zanzibar, another man-like being was also falling in love, with a female of his own kind in the area now known as Tanzania.

Not quite Adam and Eve, not quite the Garden of Eden (though Eden could hardly have been more picturesque or the serpent better represented), they presumably partook of the forbidden fruit and produced a child. Had genetic circumstances been slightly different, they might also have produced the human race.

Whatever the case, this tiny family (in both senses of the word, as the adults were less than one-and-a-half metres tall), left an impression upon what is now Tanzania. The footprints of these hominds were preserved in volcanic ash which powdered the plains to windward of the erupting volcano Satiman, which present-day tourists pass on their way from Ngorongoro to the Serengeti.

These footprints in the compacted ash of time have been buried to preserve them until such time as they can be re-excavated

and safely displayed. The site, “Laetoli” (the Masai name for the spiky blood red lily which blooms there after the rains) have reverted to bush.

But a little way to the north, at Olduvai (named after the wild sisal which grows there), more varied and visible evidence of Tanzania’s prehistoric past is displayed in a small museum, and conducted tours of parts of Olduvai Gorge itself are available, bringing tourists (almost) face to face with their ancestors.

The Serengeti plains, through which the Olduvai George cuts its famous gash, were strewn with volcanic ash, which gives the short grasses there a nutritious sweetness, seductive enough in the rains to draw more than two million animals over 100 miles, from the far corners of the Serengeti and beyond the Kenya border.

The volcanoes, all but one, “Ol Doinyo Lengai” (the Masai Mountain of God), are now dead or dormant. But they have lost little of their grandeur. They have shaped Tanzania’s northern panoramas, from the Serengeti through the Ngorongoro Highlands to the greatest and most beautiful volcano of them all, Kilimanjaro.

And the plains themselves, their grasses succoured by rich volcanic soils, are edged by the long-flowing curves of a landscape plastered smooth by lava. This northern frontier is the Africa of books and films and fantasies.

Here and there in this vast expanse of grassland and bush and mighty volcanic mountains live a fascinating people,

June 2006 New AfricAN n 47

Tanzania takes the breath awayBigger than France and Germany combined, and almost four times larger than the UK, Tanzania has a history as long and as fascinating as its physical assets are wild and wonderful, reports Graham Mercer

Far left: Tanzania’s stunning Ngorongoro Crater, part of the Great Rift Valley

“This norThern fronTier is The AfricA of books And films And fAnTAsies”

pastorialists and cultivators and even hunter-gatherers, half as old as time. Here lions are still occasionally speared to death by warriors without wars, the dangerous buffalo is still brought down by little men with immensely powerful bows, their arrows tipped with a deadly poison, and the scrawny hump-backed cow is worshipped by the pastoralists with an almost Hindu reverence.

The northern marches were also split asunder by violence, when the earth, from the Mediterranean to the Zambezi, dropped along a massive fault to form the Great Rift Valley. In Tanzania, the Rift, especially around “Ol Doinyo Lengai”, still smouldering sullen, is spectacular, its pyramid peaks and forbidding cliffs contrasting with the feminine curves of the valley floor.

To the east of the Rift, a brief outbreak of isolated volcanoes, including the 4,566 metres (14,950 feet) Mount Meru, that towers above the northern town of Arusha, culminates in “Ol Doinyo Ebor”, as it is known in Masai (the White Mountain), the highest mountain in Africa, highest free-standing mountain on Earth, Kilimanjaro, at 5,896 metres (19,340 feet) dominates the region, physically and metaphorically.

Across the narrow “Kilimanjaro Gap”, through which the British forces pursued the strategically retreating Germans and their African askaris during World War I, lie very different mountains. Much lower in height but much older in time, the North and South Pare, and the Usambaras to the southeast, are Africa’s answer to the Galapagos: islands in the clouds.

The Pare and Usambaras are part of a broken and similarly exciting series of ranges known as the “Eastern Arc” which curve down from the Taita Hills in southern Kenya to Tanzania’s southern highlands.

The southeastern half of Tanzania, into which these ranges eventually sweep, is quite different from the volcanic north with its spectacular mountains, great open plains, and attractive Acacia commiphora woodland. The south is characterised by claustrophobic miles of deciduous miombo forests, relieved by serpentine brown rivers, refreshing highland ranges or patches of cultivation. It is here, in these apparent wastelands, that some of the world’s most

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Tanzania ProfileTanzania gained independence from Britain as Tanganyika on 9 December 1961, and became a republic in 1962.Zanzibar, the twin-island nation off Tanganyika, became independent in December 1963, and a republic on 12 January 1964.

After protracted negotiations, the two sovereign countries – Tanganyika and Zanzibar – joined ranks and formed the United Republic of Tanzania on 26 April 1964.

Multiparty elections, held on 14 December 2005, brought President Jakaya Kikwete to power for his first five-year term. The constitution allows him to run for a second term.

Tanzania has 18 registered political parties, the largest being the ruling Chama Cha Mapinduzi (CCM) which has been ruling since indepen-dence; the Civic United Front and the Chama Cha Demokrasia na Maendeler (CHADEMA).

Political capital: Dodoma (where the 323-member parliament sits).

Business capital: Dar es Salaam (which hosts the State House, and offices of parliamen-tary committees).

Location: In East Africa The two islands of Zanzibar – Pemba and Unjuga – lie off the eastern coast in the Indian Ocean, 30km from the mainland.

Size: Mainland: 883,600sq km (larger than Nigeria)

Zanzibar: 2,500sq km.Population (2005): Mainland 36 million Zanzibar 1 million National 37 million

currency: Tanzania shillingsrate: Tshs2,400 = £1

Tshs1,250 = US$1 Major islands:Tanzania mainland: Ukerewe, 647sq km Mafia, 518sq kmZanzibar major islands:Unguja, 1,666sq km Pemba, 988sq km

Major lakes:Lake Victoria in the north, 34,900sq km (Tanzania has 41% share, the rest is shared by Kenya and Uganda). Lake Tanganyika in the west, 13,400sq km (Tanzania shares with DRCongo). Lake Nyasa in the south, 5,600sq km (Tanzania shares with Malawi). Lake Rukwa, 2,800sq km. Lake Eyasi, 1,000sq km.

Highest peaks:Tanzania has 32 mountains, all over 2,000 metres above sea level, the 10 highest being: Mount Kilimanjaro, 5,895 metres Mount Meru, 4,566 metresLoo Malasin, 3,648 metresOldeani, 3,188 metresLemagruti, 3,132 metres

Monduli, 3,000 metresMtorwi, 2,961 metresMount Rungwe, 2960 metresGelar Peak, 2,942 metresChaluhangi, 2, 933 metres

road network (as at December 2005):Trunk roads: 3,914km paved, 6,021km unpavedRegional roads: 328km paved, 18,630km unpavedDistrict roads: 30km paved, 19,970km unpavedFeeder roads: 27,550km unpavedUrban roads: 470km paved, 1,980km unpaved

National Parks:Serengeti, 14,750sq kmRuaha, 13,000sq kmNgorongoro, 8,320sq kmMikumi, 3,230sq kmTarangire, 2,600sq kmKatuvi, 2,252sq kmSandani, 1,100sq kmUdzungwa, 1,000sq kmKilimanjaro, 750sq kmRubondo, 460sq kmKituo, 442sq kmMahale, 410sq kmLake Manyara, 325sq kmArusha, 117sq kmGombe Stream, 52sq km

rainfall:Tanzania is divided into two rainfall patterns – one-season and two-season rainfall regimes. The one-season occurs from November/December to April over the southern, southwestern, central and western areas of the country. The two-season (long rains) regime occurs between March and May (mainly short rains) between September and December over the coast north of Mafia and its hinterland, north-eastern highlands, Lake Victoria basin and the islands of Unguja and Pemba.

48 n New AfricAN June 2006

magnificent and least publicised national parks are situated.

The vast Selous Game Reserve is contiguous with Mikumi National Park, the two forming a sanctuary more than 50,000sq km in extent, and, separated from this immensity of big game country only by a dirt track and a narrow strip of cultivation, is Udzungwa Mountains National Park, part of the Eastern Arc and as unique as the Usambaras.

Beyond the mountains to the west, beyond the hauntingly wild Ruaha George and the Iringa Plateau, lies Ruaha National Park, with the eponymous river, massive bull elephants and superbly understated scenery.

And there is Lake Nyasa (sometimes known – especially if you are Malawian – as Lake Malawi) to the south. It is overlooked by the steep western cliffs of the Livingstone Mountains, a strikingly successful marriage of land and water.

Nyasa is the southernmost of the great lakes which Tanzania shares with its neighbours. To the northwest is Lake Tanganyika, the longest and deepest lake in Africa, and as rich in aquatic endemics as the Eastern Arc is rich in terrestrial plants and animals.

To the northeast of Lake Tanganyika lies Africa’s largest body of inland water, Lake Victoria (41% of which is in Tanzania). It is hard to believe that little more than a

century ago, this region was a major staging post for ivory and slave-trading caravans, and for Western explorers.

At Ujiji, on the northeast shores of Lake Tanganyika, Henry Morton Stanley (the British journalist turned explorer) had shaken hands with David Livingstone, hiding his nervousness by making his famous and fatuous presumption: “Dr Livingstone, I presume”. And it was from Ujiji that Livingstone, soon afterwards, set off on his last safari. He died in the night, as he knelt by his bed in prayer, in a village to the south of Lake Tanganyika, among the swamps which had sucked away his vitality.

Livingstone, a missionary/explorer, had been wearing his secular hat at the time, his mission more in the cause of glory than of God. He was seeking not salvation but the source of the Nile. Sadly, it had already been found, almost 1,000 miles to the north, by John Hanning Speke (another British explorer). Speke’s claim had been disputed, leading (indirectly but almost certainly) to his accidental or suicidal death in an English field, and to Livingstone’s last prayer among the swamps of Africa.

Everyone had acknowledged Speke’s discovery (for the outside world) of the lake he named in honour of his queen – Victoria. Only he had known, intuitively, that he had also set eyes upon the source of the Nile. Even today, the great lakes are rarely visited – relatively speaking – by outsiders.

Although the days of the “long walks” are over, the region is one of Tanzania’s loveliest. West Lake Province, on the western shores of Lake Victoria, is quite different from the rest of Tanzania. Even its bird life is typically West – rather than East – African.

And on the eastern shores of Lake Tanganyika are some very important national parks – Gombe Stream and Mahale Mountains, both home to our nearest and much-endangered relative, the chimpanzee; and Katavi Plains, one of the most remote national parks in East Africa.

Lake Victoria even has a wildlife sanctuary within its boundaries, for Rubondo Island National Park, as the name reveals, is surrounded by the waters of the lake in its southwestern corner. It is not always easy to reach but no one who makes the effort regrets it, for Rubondo is delightful as well as unique.

Tanzania has other delightful islands far to the east, where the Indian Ocean swells disintegrate into pure white foam on the coral breaches of Zanzibar, Pemba, Mafia and their outlying islets. Few places on Earth have names that seduce the imagination as Zanzibar does.

This historic island, the stepping stone to the interior for traders, travellers, missionaries and explorers, has a history stained with blood and broken by violence. These days tourists, not slaves, are brought by the boatload to Zanzibar,

“The peace that prevails among and between Tanzania’s ethnic groups and communities is due to political planning as well as goodwill.” A traditional welcome in Masailand for President Kikwete

48 n New AfricAN June 2006 June 2006 New AfricAN n 49

50 n New AfricAN May 2006

but the spices which helped to make the fertile green island rich and famous still grow in profusion. Always a land of contrasts, its main port, Zanzibar Town, would still be recognisable to Burton and Speke, Livingstone and Stanley. Behind its celebrated waterfront, with its Sultan’s Palace, House of Wonders and Arab fort, the town’s confusion of narrow streets and alleys, secluded from the direct rays of the sun by high-walled buildings, entice visitors to lose themselves in what seems to be a filmset for an Arabian Nights fantasy – with a cosmopolitan cast of thousands.

Just across the island on the eastern coast, history gives way to hedonism as tourists discover that pleasure can be synonymous with peace of mind. And peace of mind, along these near-deserted white beaches, is as plentiful as palm trees. Pemba Island, the true “Isle of Cloves” away to the north, has idyllic coves and coral strands of its own; virtual secrets made of sand.

South of Zanzibar is Mafia, another diver’s paradise. Mafia, like Zanzibar and Pemba, is rich in underwater life and has long been known for its deepsea fishing.

Across the Pemba Channel to the west, the coastline of mainland Tanzania stretches north towards Kenya and south to Mozambique. Apart from Dar es Salaam, the “Haven of Peace”, the sumptuous green commercial capital of the country (the political capital is Dodoma), and the small, sleepy ports of Tanga to the north and Lindi and Mwara in the far south, the coast has no major cities or even towns. There are villages and cultivation, however, along most of its length.

Dar es Salaam (two decades of assiduous tree planting has turned it into a gorgeous city) is actually Arabic for “House of Peace”, but “Haven” seems appropriate. The city’s architecture is as interesting as that of Zanzibar, reflecting the city’s short but cosmopolitan history. Modern buildings are rapidly replacing or overpowering Dar es Salaam’s more elegant heritage, but the city remains refreshingly green, and its location, half encircled as it is by a sweepingly picturesque seafront, makes Dar (as it is affectionately called) one of the most beautiful cities in Africa.

Dar’s other most appealing characteristic

is its village-like cosiness and laid-back tropical coastal charm. It is a largely friendly meeting place of the nations, where drivers still hold up the traffic to continue a conversation, and where expatriates from all over the world can barely walk the length of a block without bumping into someone they know. True, it can be a most exasperating and tiring place to visit or in which to live, but it retains an endearing appeal. Many who know it well regard it with a genuine and lasting affection.

Elsewhere, Old Bagamoyo (from where the current president, Jakaya Kikwete hails has scarcely changed since Henry Morton Stanley strode in from his epic west-east crossing of the continent, accompanied by Emin Pasha, the eccentric intellectual whom Stanley claimed to have “rescued” en route.

All said and done, among the ashes of circumstance burn embers of the human spirit – of dignity, tolerance (both racial and religious), a desire for knowledge and, not least, an amazing readiness to laugh and joke; a wonderful sense of humour despite everything. And much else, including an overlying national predisposition towards peace.

They are united, much more than peoples in other African countries, by something more positive than poverty, something more calculated than historic accident. The peace that prevails among and between Tanzania’s ethnic groups and communities is due to political planning as well as goodwill, enshrined, by the Father of the Nation, the late Mwalimu Julius Nyerere, in his famous Arusha Declaration, and upheld by his successors.

The people are also united by national pride – the eyes of the poorest peasant will often shine with genuine delight to see a photograph, a film or a book which reflects the beauty and the enchantment of his or her country. With justification, for that country is, for all its problems and shortcomings, one of the most exciting places on Earth: the “Real Africa”. g NA

This article was taken from Graham Mercer’s wonderful coffee table book, Tanzania, African Eden, a book highly recommended by New African to its worldwide readers.

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“dAr remAins refreshingly green, And iTs locATion, hAlf encircled by A sweepingly picTuresque seAfronT, mAkes iT one of The mosT beAuTiful ciTies in AfricA”

Tourism minister, Prof Jumane Abdallah Maghembe presides over a huge tourism potential

We have a common goal of improving the competitiveness of our economy and eventually achieve

better life for all Tanzanians. Most of the reforms we have made have produced positive results. The financial sector reforms are now firmly entrenched. Currently there are 33 mostly private banks and financial institutions operat-ing in the country, in addition to many private forex bureaus and insurance companies.

Last year, our economy grew by 5.8% compared with 6.8% in 2005. The slowdown in 2006 was due to the effects of drought and the energy crisis. The drought, experienced during the whole of 2005 and the first quarter of 2006, affected food produc-tion and power generation.

These developments together with the persistent rise in oil prices exerted upward pressure on inflation which rose to an aver-age of 6.2% in 2006, up from 4% in 2005. The foreign exchange reserve position, however, remains fairly good.

The food crisis is now over as a result of good rains received in 2006. This year, the weather condition looks promising. The pros-pects for 2007 are, therefore, good and GDP is projected to grow at around 7%. Inflation is expected to be at around 5%.

The government has reaffirmed its com-mitment to stay the course of reforms, to con-tinually improve the banking and business environment, and to promote private sector development.

To achieve these objectives, the govern-ment has since 2002 been undertaking major

reforms aimed at strengthening the business environment with particular focus on reducing the cost of doing business. The Business Envi-ronment Strengthening for Tanzania (BEST) programme is the instrument for achieving these objectives.

Specifically, this is a programme for eliminating legal, regulatory, administrative and institutional impediments that inhibit the development of a competitive private sector in the country.

In further pursuit of this noble objective, the Business Activities Registration Act (BARA) was passed by parliament in January this year. The Act aims at reducing regulation and cost of compliance to the minimum.

The overall objective is to reduce the cost of starting up business. Measures are afoot to streamline and harmonise the business licens-ing regime to ensure that regulatory licensing covers only businesses that have to be regu-lated by statute.

The land laws have been amended to accommodate the provision of mortgages in

order to reduce risk to lenders and make bor-rowing easier for business. I am glad that the Tanzania Bankers Association was involved in the review of the Land Act.

We are now working on expanding the scope of land reforms with a view to develop-ing an efficient registration system for land titles. This will also involve strengthening the land information system and improving the survey and mapping infrastructure across the country.

New resources are also being marshalled to strengthen further the Land and Commer-cial Divisions of the High Court and the estab-lishment of a National Identification System (National ID).

Labour laws are also undergoing reforms to address the concerns of stakeholders, including the banking fraternity. The under-lying objective is to promote a better and effi-cient labour market and labour relations.

The government has recently taken delib-erate measures to deal with the problem of efficiency of the judicial and legal system

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Tanzania The economy goes marching onPresident Jakaya Kikwete met members of the Tanzania Bankers Association on 3 April and gave them a report on the state of the economy. “The prospects for 2007 are good and GDP is projected to grow at around 7% and inflation at around 5%,” he told them. Here are excerpts.

“TogeTher we cAn meeT The chAllenge of building A sTronger economy for The benefiT of us All. iT cAn be done, plAy your pArT”


which has been a source of great concern. We have increased the number of judges and magistrates while at the same time addressing the infrastructural problems inherent in the judicial and the legal system as a whole.

Regarding the ongoing investment drive, our objective is to see increased investment and business in manufacturing, agriculture, tourism, energy, infrastructure, information and communication technology, export trade and human resource development. To this end, I have made investment promotion a major item on my development agenda.

Now, let us have a look at the other side of the coin – how has the banking system per-formed and what do we expect of it? I note with satisfaction that there has been a marked improvement in the diversity and quality of operations and services in the banking sec-tor in the recent past. For that, I commend you all.

We count on the financial sector to play a key role in consolidating our economic gains. For, we cannot make significant progress in

Tanzania’s growth drive unless the financial sector moves with us.

First, there is need to address public complaints on the banking sector. There are complaints that banks and financial institu-tions in the country are not aggressive enough in looking for alternative investment vehicles. They behave so poorly because they earn high returns by just investing in government secu-rities and Central Bank liquidity papers. The large profits declared by banks and financial institutions somehow confirm this statement. I am informed that, the ratio of credit to cus-tomers’ deposits is about only 45%. This means that 55% of deposits is invested in

government securities, liquidity papers of the Central Bank of Tanzania and in other assets.

Secondly, we need to find a solution to the present huge spread between lending and deposit rates. While inflation has fallen from 30% in 1995 to around 6% at present, the lending rates have dur-

ing the same period declined more slowly from 37% to an average of 17% currently.

Apart from high lending rates, borrowers are also charged loan administration fees rang-ing from one to two per cent. Conversely, I am informed that most banks are offering a mere one to two per cent interest on deposits which is negative in real terms when assessed against the inflation rate of 6%. I know bank-ers have a long list of reasons to justify the substantial interest spread, but honestly, a spread of 15% can hardly be justified.

The banking fraternity should do more to reduce the cost of credit in the economy. In this regard, the banks ought to bring down the cost of credit to reasonable levels so as to expand their clientele to include businesses engaged in production, for these are the busi-nesses which are currently unable to climb the ladder with the banks. This includes the development of loans products for the agri-cultural sector.

Thirdly, I am informed that some banks have floated and others are considering floating bond products of long-term nature in a move to address the lack of long-term financing. I have also taken note of the fact that a few banks have ventured into mortgage financing. I commend them for the move. For it is impossible for the majority of Tanzanians to build houses from their own savings alone. Remember, shelter is one of the three basic needs of humankind. The government is com-

mitted to facilitate a process that will enable most Tanzanians to own their own houses.

I have heard that the banking sector prides itself on a network of 294 branches and agencies, and 176 Automated Teller Machines. Unfortunately, most of these are concentrated in urban areas, leaving the bigger portion of our vast country without financial services. I suggest that the banks revisit their policies on branch expansion programmes. We want all Tanzanians to have easy access to banking services.

This is the only way we can truly incul-cate a savings culture in our society and build confidence in financial intermediation. For, there is still too much money circulating out-side the banking system, a situation which is not healthy for our economy. I am confident that the banks can assist in the provision of financial services in the rural economy with-out necessarily compromising their returns on investment.

The National Economic Empowerment and Job Creation programme has dominated the news recently. This programme was intro-duced by the government this fiscal year with a view to providing soft loans to individual entrepreneurs, economic groups and financial intermediaries. The programme is to be imple-mented in two phases. Phase One involving the two big banks, namely CRDB and NMB, and the second phase would involve small banks and other financial intermediaries that would be interested.

I would like to take this opportunity to reiterate that the money under this pro-gramme is not free money. It is money meant to facilitate the provision of loans to targeted groups under certain terms and conditions.

In this regard, the banks and financial institutions are expected to apply their normal lending principles and procedures when pro-cessing applications from would-be borrowers, but, of course, taking into account the require-ments for the provision of soft loans and the fact that many of the clients in this category are not familiar with banking rules.

For the programme to succeed and be sustainable, loans should be repaid. I, there-fore, call upon banks to join hands with the government to ensure that the programme succeeds. I believe that by working together – the government and the banking sector – we can meet the challenge of building a stronger national economy for the benefit of us all. It can be done, play your part. g NA

President Jakaya Kikwete rallies the troops

52 n New AfricAN June 2006 June 2006 New AfricAN n 53

There is a cardinal rule in govern-ment circles in Tanzania: “You joke with investment promotion and you have no job to come to tomorrow.” Investment and

investors (both local and foreign) have a special place in Tanzania. And their number one champion is none other than President Jakaya Kikwete himself.

“There is no doubt that investment engen-ders economic growth, creates jobs and raises people’s incomes, hence it reduces poverty,” the president told the Tanzania Bankers Asso-ciation at its annual dinner in Dar es Salaam on 3 April this year.

“It is with this realisation,” the president continued, “that my government is quite keen on developing sustainable partnership with the financial sector and the private sector as a whole, in order to create a conducive invest-ment climate in Tanzania. To this end, I have made investment promotion a major item on my development agenda.”

The president continued: “We have agreed in government that we should give prominence to eight sectors and sub-sectors in our investment drive and overall growth strat-egy. These include manufacturing, agriculture, tourism, energy, infrastructure, information and communication technology (ICT), export trade and human resource development.

“Our objective is to see increased invest-ment and business in these sectors. We are ready to go to great lengths to ensure that these aspirations are attained, for, I believe that if we succeed in these areas, we will make a big leap forward in the development of our economy. I, therefore, look forward to the con-tinued support and cooperation of the bank-ing sector to enable us to succeed in these endeavours.”

At the heart of the government’s invest-ment promotion drive is the Tanzania Invest-ment Centre (TIC) headed by the affable Emmanuel ole Naiko as executive director. The TIC is the government’s promotional agency charged with two main tasks: to promote

investment opportunities to foreign investors and to develop local investors to be partici-pants in the economy. Additionally, it has the subsidiary task of portraying a positive image for the country.

The TIC performs these tasks by, first, facilitating the entry of investors into the economy and making them happy to stay.

“When investors come here,” says the TIC executive director, “we help them to settle, and after they had settled, we give them ‘after-care services’.”

This is done through small groups of offi-cials at the TIC who are charged with looking

after a given investor or group of investors. “For example,” says Emmanuel ole Naiko, “if an investor comes in and says I want to settle in Area A, we facilitate him through our one-shop centre, and after he is settled, we regu-larly visit him – first after six months to check if he has any problems, say, with the city coun-cil or the local people. It is our responsibility to resolve such problems.”

The one-shop centre has become the core of the TIC’s operations. Before its establish-ment in 2000, an investor had to go to vari-ous ministries to get the paperwork done, with all the bureaucracy involved. Now all the relevant ministries, agencies and institutions that deal with investors and business start-ups, have their senior officers based at the TIC and operating under the direction of the TIC executive director. Thus, investors can now obtain all the relevant start-up documents and facilities from the TIC’s one-shop centre – anything from land, business licences, immi-gration papers, etc.

“So, all that an investor now does is to

deposit his papers here and we do the rest for him,” says Naiko. “We will say, ‘please come back after 14 days to collect your papers’, and after 14 days he comes and his papers are ready. During those 14 days, the investor could be doing something else. He doesn’t need to be chasing papers. We do all that for him, so that he won’t be exposed to the dangers of bureaucracy. We don’t even charge a fee for facilitation, but only for registration.”

In March this year, the TIC was given the annual WAIPA award jointly with Portugal and South Korea after being adjudged among 260 investment promotion agencies worldwide to

be generators of best practices in the field. The three countries were recognised for their excellence in aftercare services to companies that have established in their jurisdictions. The award was jointly given by WAIPA (World Asso-ciation of Investment Promotion Agencies) and UNCTAD after a survey of 260 agencies worldwide. The survey looked at the way the agencies had been set up, the legislation they operated on, their mandates, their networking with other government institutions and inves-tors (ie, how free they were with investors and how the investors feel about the agencies and their usefulness to them, etc).

The 260 agencies were whittled down to 20, then after scrutinising them, the best 10 were picked, and then from the 10, they looked for the best three who were given the first category. Tanzania, Portugal and South Korea came joint top.

“Portugal and South Korea are pretty big players in the investment field, which shows that we have done very, very well,” said a very happy Ole Naiko. “In fact, I didn’t expect us to

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Tanzania An investor’s havenIf you are looking for a place to do business, Tanzania is one such place you can’t afford to overlook. It is a country where investors are made to feel at home. Baffour Ankomah reports.

“The number of invesTors coming inTo TAnzAniA since 2000 hAs been increAsing sTeAdily AT The rATe of 100 projecTs per yeAr”



win, so I didn’t even go to Geneva myself to pick up the trophy. I had just returned from abroad with the president, so I just sent my director of research to represent us.”

Also prominent in the government’s investment promotion drive is the National Investment Steering Committee (NISC) chaired by the prime minister. The NISC also helps investors by resolving cross-sector issues that one ministry cannot deal with. Ole Naiko also doubles as the secretary of the committee. The attorney general and the governor of the Central Bank are also members.

The NISC and the TIC hold regular dia-logue with the private sector through the Tanzanian National Business Council (TNBC) where the government and the private sector meet. The TNBC is the umbrella body of the private sector in the country.

Through such dialogue, 11 obstacles that militated against business have been identified and dealt with. One was the Land Act of 1999 which was not conducive to the banks and foreign investors. The Act was duly amended

as well as sections of the labour laws which were not investor-friendly. “We looked at tax issues, we looked at the business environment in general, we looked at the judicial system, we looked at the economic reforms and so on,” says Naiko. “So we have been working very, very closely with the private sector, so much so that some people in government have mistakenly labelled the TIC as a private sector organisation. Sometimes when I travel with the president, some of my colleagues in government treat me as a private sector man even though I am a government employee. It is because sometimes I go out of my way and speak on behalf of the private sector.”

Because of the new investor-friendly environment in the country, the number of investors coming into Tanzania since 2000 has been increasing steadily at the rate of 100 projects per year. Last year, the number hit an al-time high when 679 new projects were registered.

“And the mixture of projects is what really pleases us most,” says a proud Ole Naiko.

“Investors (both local and foreign) are invest-ing in various sectors. So far, 25% of them have been foreign, 45% local, and 30% joint ventures.”

To harness its resources and services, the TIC deals only with local investors whose projects are worth US$100,000 or more, and foreign investors US$300,000 or more.

“President Kikwete is very keen on joint ventures between locals and foreigners. So what we do at the TIC is to identify and develop local entrepreneurs and people with business talent for bankable projects and joint ventures with foreign investors,” says Naiko.

MiningSo far Tanzania has been very successful in attracting investors in mining. It is now the third largest producer of gold in Africa, after South Africa and Ghana. “We started getting investors into the mining sector in 1998, after enacting a new mining code,” explains the TIC boss. “Before then, we had a mining code that was very, very restrictive, especially to

Above: Emmanuel ole Naiko (left), executive director of the Tanzania Investment Centre (TIC), receives the WAIPA award given to the TIC in recognition of its good work


foreigners. Before the new code was enacted, we sat down with foreign investors and talked about what they wanted. We also looked at the global situation, and adopted the best practice then available. Today, if you look at the min-ing industry in Tanzania, there are over 3,000 companies prospecting all over the country – in gold, tin, coal, all types of minerals.”

The government also encourages compa-nies operating in the country to be listed not only on the stock exchanges of the world, but also on the Dar es Salaam Stock Exchange so that Tanzanians can buy shares from there.

The other sector in which Tanzania has done well is manufacturing, principally because the country has privatised its loss-making parastatals. However, agro-industry still lags behind.

“We are still a raw-produce economy, because we are not adding value to our agri-cultural produce before export,” says Ole Naiko. “For example, we produce a lot of cashew nuts from the south of Tanzania, but 98% of this production is exported raw. This is terrible. So we are trying to encourage inves-tors to come here and add value to the cashew nuts before export. We’ve done some value-addition to coffee and tea, but not very much.”

Regarding textiles, Naiko says: “It is an extremely competitive industry and what we want to do now is to invite people to look at this part of production. We are producing cot-ton here, which is good but not very much. But we started in a wrong way, we started with fabric only. We did not concentrate in other areas, for example, the production of yarn. That is why we want people to come here and invest in that part of production.”

TourismCompared to its potential and resources, espe-cially in ecotourism, Tanzania has not done well in this area. For example, it doesn’t have enough hotels.

“If you go to the national parks, for instance the famous Serengeti, which is our pride, you find that the bed capacity is about 900 or so,” says Ole Naiko. “If you go to the other side of the national park which is in Kenya – the Masai Mara, a small portion abutting the Serengeti plains they have over 8,000 beds. When we went to Japan last year, their tour operators told our president: ‘We would like to come to Tanzania, but you’ve got a shortage of beds.’

“The truth is that we have not developed tourism in terms of hotels,” Naiko continues. “Our beaches are not developed, we’ve not developed our historical sites, we’ve not developed city tourism; if you come to Dar es Salaam, I cannot take you to such and such a place, but they do it in Cape Town in South Africa, they will take you to the Table Moun-tain, or to the Ostriches, for example.

“So we are encouraging investors to come

to these areas of our tourism industry. We want tourists to see animals in Dar es Salaam or good historical sites and enjoy the good beaches we have. Some people go to Zanzi-bar just to sunbathe on the beach, that is very good, but why can’t they do the same on the mainland with an 800km coastline? We still have a lot to do in tourism.”

The country hopes to attract at least one million tourists a year and be able to accom-modate them all in beautiful hotels. “We can take a leaf from Mauritius where tourism is exclusive and expensive. Otherwise, you can go to Mombasa in Kenya and find a lot of beach tourism. There, you can learn what not to do. In Mauritius, you find what to do. You go to Thailand, you see what to do and what not to do. So there are many examples for us to choose from.”

TelecomsAmong the other sectors that have grown fast over the last few years is telecoms. From a single state-owned provider, the Tanzanian Telecommunications Corporation, that ser-viced 150,000 fixed line subscribers in 1998, the telecom sector has six million subscribers today of both fixed and mobile lines.

“And I can’t catch up with the numbers, because they are coming up with new prod-ucts every day,” says Ole Naiko. “Right now if I am in London or New York, I can communicate with my mother in the village. But before then, it was a privilege to have a telephone. Today it is no longer a privilege.”

The rapid growth of the telecoms sector is ascribed to the “enabling environment” put in place by the government which encouraged

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“The counTry hopes To ATTrAcT AT leAsT one million TourisTs A yeAr”


Zanzibar’s splendid coastline has much to offer the visitor

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private operators such as Vodafone, Celtel, Tigo and others to come in.

roadsAccording to Naiko, the other area where the country is weak is infrastructure. “We’ve got a good network of 85,000km of roads, but we’ve not put in place legislation for the private sec-tor to come in and operate toll roads like in South Africa where 68% of roads are private roads. The same happens in China and USA, so we want investors to come and look into the opportunity of developing roads.”

financeAnother sector that is growing slowly is the financial sector, although the number of pri-vate banks and financial institutions has been increasing appreciably in the last few years. According to Naiko, the country needs devel-opment banks that lend for the long term. He also wants them to diversify their products by bringing in lease financing. Elsewhere, he would want to see the huge reserves of pen-sion funds now sitting idle to be used for the betterment of the country.

Skills“Another area is capital and skills develop-ment,” Ole Naiko says. “We don’t have spe-cialised schools of higher learning that train high-flying managers and technicians. If you take mining, for example, the industry does

not have enough qualified technicians. So we are encouraging investors to come and estab-lish this type of schools.”

As happens everywhere, not every Tanza-nian is happy with what local critics have called the “foreignisation of the economy”. There have been criticisms by some Tanzanians who claim that under the former president, William Mkapa, the country went through a period of “foreignisation” when plum national assets were sold off to foreigners, particularly white South African companies, during the country’s privatisation drive.

“This is nonsense,” says Ole Naiko. “I heard, and still hear, these criticisms from people who did not know what was going on.” In this, Naiko is supported by the minister for planning, economy and empowerment, Dr Juma Ngasongwa, who confirms that when it comes to investment in Tanzania, South Africa comes a poor seventh. “The number one investor in Tanzania is the UK, followed by Kenya, India, China, and either Germany or Holland. South Africa is in fact seventh.”

Which is why the TIC boss wants the

critics to be realistic. “For those of us who were involved,” Naiko says, “what we wit-nessed during the socialist days when we believed that all the industries must be ours (belonging to the state), we watched in hor-ror as the industries completely collapsed. We couldn’t continue with the loss-making corporations, so we had to privatise. And the privatisation was done on the back of an act of parliament and after long discussions and debates by the public.

“So I laugh when I hear criticisms about the ‘foreignisation’ of our economy. These crit-icisms were, and still are, made by people who enjoy making criticisms for the sake of it. They are not realistic. For example, when the New Africa Hotel in the heart of Dar es Salaam was privatised, the government kept 23% of the shares without putting in a nickel. And those shares were later sold to Tanzanians.

“The same happened to Tanzania Brewer-ies and the Tanzania Cigarette Company. The shares kept by the government enabled many Tanzanians, including myself, to buy shares in Tanzanian Breweries which was bought by

“we Aim To empower more TAnzAniAns To enTer The privATe secTor. we wAnT everybody To be on boArd”


A mosquito net factory in Arusha. "We want investors in textiles," says the TIC boss

Emmanuel ole Naiko, executive

director of the Tanzania

Investment Centre (TIC) receives

South African Breweries. The government retained a certain percentage of shares which it later sold to Tanzanian citizens, and I think that is the way it should be.”

Naiko continued: “During the social-ist era, pubic servants and members of the ruling party were not allowed to do business or own shares in capitalist firms, which were not there anyway. So where were we going to get Tanzanians with the money to buy the state corporations which were collapsing? Did we have to wait until Tanzanians got rich enough and bought the corporations?

“Doing business today is not a question of ‘foreignisation’ or ‘localisation’. It is a global business. You look at the airline indus-try where mergers and acquisitions are the order of the day. But because of our socialist background as a country and people, we are always looking at ‘this is ours and must be kept as ours’.

“We used to have the National Milling Cor-poration which was in charge of milling all the grains in the country and selling some rice and so on. What did Tanzanians benefit when this company existed, when we used to queue for bread? It just does not make sense!

“Right now, when you look at the busi-nesses going on in Tanzania, even some of the so-called privatised companies, say the cigarettes company which was first taken over by a British company and later sold to the Japanese, the shares in that company have

now been sold to Tanzanians. So you need to allow whoever is able to rescue the situation to do so, but the important thing is to take pre-cautions that will enable the nation to benefit from such privatisation.”

In fact, President Kikwete’s government is keen to develop such partnerships, “not by way of legislation”, as Naiko puts it, “but by creating an environment that enables both foreigners and locals to buy into such busi-nesses. Having said that,” he continued, “there are certain strategic companies in Tanzania which will never be privatised. For example, the port, the railways and the national airline, they will just be on concession and will not go into anybody’s hands. They will be ours.”

Private sectorTanzania’s private sector came into being only after the enactment of the first investment code in 1990 which allowed individuals and companies to participate in the economy. Even the 1990 code had segregations that set apart areas for locals only – such as barbers shops, saloons, taxis and so on.

Other areas were only open to public corporations, banks, insurance companies, etc. “Thus, the private sector trickled in slowly,” Naiko remembers. “Foreign inves-tors came slowly because things were bad before 1995 when the bureaucracy, then still entrenching, became too cumbersome to deal with. So in 1996 we got a new invest-

ment code and things took on a new life. Since then, the private sector has been very dynamic, it is developing very fast, but as usual not as fast as we want. That is why we continue to have dialogue with the pri-vate sector through the Tanzanian National Business Council. We aim to empower more

Tanzanians to enter the private sector. We want to capture everybody. We want every-body to be on board.”

The futureAccording to the TIC boss, the flow of invest-ments into the country will increase consid-erably in the next few years. “The future is bright,” he says. “First of all, we have the high-est level of support from the president himself and the government in general. And that is critical. If you want to embark on any invest-ment promotion, you must have government support, and we have it in abundance here.

“When WAIPA gave TIC the award this year, they looked at the depth of the agency’s connections with the government and its other institutions. For us, we are lucky that the president himself is the number one invest-ment promoter and facilitator. He does not take kindly to anybody who mishandles inves-tors. Because he believes that investment is one of the main tools which will help us reduce poverty by creating jobs.

“So we have political support. The prime minister too is committed to investment pro-motion. So the top two people in the country are firmly on our side, totally committed to investment promotion.

“So far, the flow of investment has kept me very busy, so much so that I hardly see my family these days. It’s tough. But what pleases me is that we have a good and dedicated team at the TIC to help the investors who are com-ing. It is a win-win situation.” g NA

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“The top two people in the country are firmly on our side, totally committed to investment promotion” – President Kikwete (left) and Prime Minister Edward Lowassa

“iT is now The Third lArgesT producer of gold in AfricA, AfTer souTh AfricA And ghAnA”


Tanzania has been focusing on growth as a key element in the fight against poverty. The National Strategy for Growth and Reduction of Poverty

(NSGRP, also called Mkukuta in Swahili) is divided into three clusters. The first addresses the acceleration of economic growth and reduction of income poverty. The second is about improving the quality of life and social wellbeing of Tanzanians (ie, the provision of education, portable water, health facilities, rural roads, electricity, etc). The third addresses good governance and accountability in tune with the country’s democratic traditions.

According to the minister for planning, economy and empowerment, Dr Juma Alifa Ngasongwa, Tanzania has been lucky that its domestic resources have been increasing over the years. “We’ve made tremendous progress in revenue collection. In 1995, local revenue collection was Tshs25bn, but by December 2006, it was Tshs259bn, so you can see tremendous growth in that area.

He continued: “We have also made good progress in the last five years in terms of GDP, averaging almost 6.2% growth, although last year we went a bit down partly because of the drought which hit us towards the end of 2005 and spilled over to the beginning of 2006. This caused food short-ages and, therefore, food prices went up.”

Because of the heavy dependence on hydro-power generation, the drought also meant that the country faced huge shortages of electricity as it closed down two power sta-tions within six months. Together, the two sta-tions produce more than 50% of electricity in the country. Other smaller power stations were also shut down because the water sys-tem came from the same catchment area.

Although there was load shedding, it

affected mainly domestic and office users rather than industrial users as the govern-ment gave them priority in accessing electric-ity, and also because the industries had their own back-up arrangements.

The government has now put in place a national power master-plan at whose core is the diversification of power supply. “Not only are we going to focus on hydro-generated electricity but also on coal-to-electricity gen-eration since we have huge deposits of coal in the country,” says Dr Ngasongwa. “We also have huge deposits of gas, so gas is going to play a more substantial role in power genera-

tion.” A Canadian company is currently building a new gas plant in the south of the country which will provide elec-tricity for three regions in the area.

“In terms of diversification,” Dr Ngasongwa explains, “we are look-ing at solar, wind, etc. Overall, we now

appreciate the need to diversify our energy sources.”

A huge country with large patches of dry regions in between,

Tanzania needs water for domes-tic consumption and industrial and agricultural use. “We need water for Dar es Salaam whose water system was installed several decades ago, and which can no longer support the fast growing city popula-tion of over three million peo-ple,” says Dr Ngasongwa.

“The demand for water in the capital city is therefore

huge, especially now that the number of industries in the city is increasing, particularly the textile sector that needs a lot of water to function properly.

“So we are updating the Dar es Salaam water system at the source of supply at the Ruvu River (both upper and lower Ruvu River systems). We are also planning to build a dam upstream of the Ruvu River so that during the rainy season, we

can get more water and store it for use during the dry seasons.”

water from Lake VictoriaThankfully, Tanzania can now take water from Lake Victoria (of which it controls 41%, the rest is shared by Kenya and Uganda) after protracted negotiations with Egypt over the use of the Nile waters.

Africa’s longest and most famous river

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The way forward“The future is bright for Tanzania but we need to work hard,” says Dr Juma Alifa Ngasongwa, Tanzania’s minister for planning, economy and empowerment. He talked to Baffour Ankomah.

“we Are looking AT solAr, wind, eTc. we AppreciATe The need To diversify our energy sources”

Above: Dr Juma Ngasongwa (left) welcomes Jeffrey Sachs to Tanzania. Sachs is the director of the UN Millennium Project and special advisor to Kofi Annan, the former UN secretary general


takes its source from Lake Victoria and a bad agreement signed between Britain and Egypt in the colonial era deprived the East African countries through whose territories the Nile passes on its long voyage to Egypt and the Mediterranean Sea, the use of the Nile waters.

“There was a bit of uneasiness from Egypt which did not want us to use water from Lake Victoria,” says Dr Ngasongwa. “There is now an understanding that we can take water from Lake Victoria, given the fact that Tanzania controls 41% of the lake. It is ironic that our two regions bordering the lake (Mwanza and Shinga) also happen to be some of the driest areas of the country. So we have put up a huge pipeline from the lake to draw water to towns in that area and a number of villages on the way. The cost is huge, but we should be able to finish the proj-ect in the next financial year. It will provide water for over six million people in that part of the country.”

There are other water programmes underway for different regions of the country. Tanzania was the first colony in East Africa to gain independence, but unfortunately as a “trusteeship”, not a colony or protectorate of the British, London didn’t do much to develop the country compared to, say, Kenya and Uganda which the British considered as their own colonies. Tanzania, therefore, has to do it all by itself since attaining independence.

According to the planning minister,

Mkukuta is the plan to carry the country for-ward in its pursuit of faster economic growth and reduction of poverty. “In our understand-ing, there is income poverty and there is non-income poverty,” says Dr Ngasongwa. “Non-income poverty means you don’t have good schools or sufficient schools or good health facilities, and so on. This accentuates the pov-erty level in the country.

“So, the approach to fight poverty is to ensure fast economic growth by developing the productive sectors. Agriculture is number one for Tanzania because the majority of our people are engaged in it. But also we need to develop industry, that’s why we have a policy under the export processing zones legisla-tion aimed at fast-tracking industrialisation in Tanzania. We have another programme which also aims at fast-tracking development in rural areas – in industry, in agriculture, in fisheries.”

Dr Ngasongwa continues: “Now there is a new fashion of developing bio-fuels. We want to go into that as well. We have some compa-

nies that have shown interest in that area to produce bio-diesel or ethanol which can be used not only locally but also for export.

“We also intend to use the experience of the Asian countries to fast-track development by adopting an export-led industrialisation process, so that we can earn foreign exchange and increase employment for our people while utilising our national resources through pro-cessing or adding value domestically.”

So far, the country has invested so much hope in Mkukuta, the national strategy for growth and poverty reduction. It is a home-based plan adopted after a lot of consulta-tion between the government and the private sector. Launched in 2005, it is a five-year plan which will end in 2010.

It is part of the National Development Vision 2025, which envisages Tanzania becom-ing a middle-income country by 2025. Thus Mkukuta is seen as a vehicle that will enable the country to achieve the 2025 vision.

“We also have a 20-year plan called the ‘Tanzanian Mini-Tiger Plan’ modelled on the Asian tigers,” says Dr Ngasongwa. “The aim is to make Tanzania an export-led industrialised nation in 20 years’ time.

“The future is bright for Tanzania but we need to work hard and to use science and technology in the production processes. I don’t think it is intelligent to work hard without using new knowledge. We have to build a knowledge society. ICT is very paramount.” g NA

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A fish market on Lake Victoria. The approach to fighting income-poverty

is to ensure fast economic growth by developing the productive sectors

“The Aim is To mAke TAnzAniA An exporT-led indusTriAlised nATion in 20 yeArs’ Time”


The International School Moshi (ISM) in the Kilimanjaro region of Tanzania is attempting through its Student Scholarship Programme to address the issue

of how the country trains its future leaders today. With generous support from Barrick Gold Tanzania (Bulyanhulu Gold Mine), KLM Royal Dutch Airlines and parents’ tuition fees, ISM has offered nine scholarship students from across Tanzania the opportunity to study for their International Baccalaureate Diploma. Scholarships cover all costs associated with the students’ study, including tuition, boarding and extra-curricular activities.

Through a partnership with TanEdu, a Tanzanian NGO providing educational information and services, ISM is able to offer scholarship places to students who have excelled in the national Form Four examinations. One of those students, Stephen Lwendo, who took up a scholarship place at ISM in 2004, gained 42 out of a possible 45 points in his International Baccalaureate Diploma last year and is now studying engineering at Harvard University on a full scholarship.

“Currently in Tanzania, natural leaders

do emerge but mostly through personal struggle and determination,” says the ISM’s development officer, Anne Wilshin. “So how do you enable those talented young people, standing on the bottom rung of the socioeconomic ladder and struggling just to meet their own basic needs, to excel academically and become this country’s future leaders? At International School Moshi we are trying to answer this question by offering scholarship places to students whose parents cannot afford to educate them beyond primary school.

“One of our current scholarship students is the first person from his community to attend secondary school in 15 years. Mhula takes a 28-hour bus journey to reach our school from his village, where his parents are subsistence rice farmers. He is academically gifted and totally committed to helping his local community. How would Tanzania be able to use his talents in the future without initiatives like this?

“Investing in education across Tanzania is extremely important – and at the same time, Tanzania needs home-grown leaders now to guide the country’s development efforts. Our scholarship programme is

helping those future leaders to develop their academic potential, global perspective and sense of personal direction.”

Although the scholarship programme has only been running since 2003, the ISM is confident that those graduates currently studying in the USA will return to Tanzania after finishing their degrees.

Ms Wilshin says: “Tanzania has a very good track record of students returning here after completing their education – people really do want to come back and make a difference. Through the International Baccalaureate curriculum that we teach, we encourage our students to learn from different perspectives and to bring that learning back to their own community. Our scholarship students want to repay the investment they feel people have made in them.” g NA

(For more information on International School Moshi’s Scholarship Programme, see p68.)

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investing in tomorrow’s leaders todayHow do you prepare talented young people to become Tanzania’s future leaders?

Nicholaus Mollel (left) and Stephen Lwendo who won International School Moshi scholarships last year are currently studying at Amherst and Harvard (USA) respectively


Baffour: Can you give us a brief history of Celtel Tanzania?Bashar Arafeh: Celtel Tanzania was launched in November 2001 and was the fifth entrant into a highly competitive cellular market in Tanzania. Over the last five years, Celtel has grown to become the network coverage leader in the country. Celtel Tanzania Ltd is part of the MTC group which operates as Celtel in Africa. MTC group is the fifth largest mobile operator in the world in terms of geographic footprint

– serving in markets with a total population of 470 million people.

The MTC group has a presence in 15 African countries: Tanzania, Kenya, Nigeria, Uganda, Zambia, Malawi, Congo Brazzaville, Gabon, Sierra Leone, Chad, DRCongo, Burkina Faso, Niger, Madagascar and (Mobitel in) Sudan. The MTC group also operates in five Middle Eastern countries: Kuwait, Bahrain, Jordan, Iraq and Lebanon. MTC has just won a licence in Saudi Arabia. This will increase our size to 21 countries.

Baffour: What is the competition like, and the percentage of your market share?Arafeh: There are many players in the telecoms sector in Tanzania and as such it is a very competitive market. Celtel has around 40% market share.Baffour: What new products have you introduced, and what is in the pipeline?Arafeh: Celtel offers a wide range of communication solutions for its customers. It was the first to launch the borderless network for its customers in East Africa – One Network. This service enables our customers to use the same SIM card in all three countries of East Africa at host country tariffs, and top up airtime using host country vouchers, among other benefits. Celtel was also the first to launch GPRS/EDGE which enables customers to have access to multimedia message service, internet and Celtel portal anywhere in Tanzania.

For the time being, the main obstacle in the uptake of GPRS/EDGE is coverage and adoption, not speed. Providing that market conditions allow for this, and as we grow this base of users, we will also continue to further invest in the technology with a view to launching an enhanced version of 3G.Baffour: Do you get any protection from the government against foreign competitors who want to come into the market?Arafeh: No, we don’t get any protection from the government. As you may be aware, all the three major players in the cellular industry have local and foreign shareholding. We certainly understand that the government has an obligation to provide a conducive environment for us to do business. We are encouraged by all the efforts that the government is putting in to ensure that we continue to thrive as a sector in parallel with the provision of services to currently underserved areas.Baffour: Are you happy with the tax regime in the country?Arafeh: We offer a service – communication – that is today a vital need and not a luxury.

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Telecoms celtel Tanzaniasets the paceTanzania has a vibrant cellular market, and one of the three major players is Celtel. Bashar Arafeh, managing director of Celtel Tanzania, talked to Baffour Ankomah.

“The Telecoms secTor in TAnzAniA is very vibrAnT... There Are mAny plAyers And As such iT is A very compeTiTive mArkeT”



The telecoms sector in Tanzania is very vibrant. We understand that the government has revenue concerns and that taxation is the major source of this revenue.

Tanzania has one of the highest taxation levels on the mobile services sector in Africa, and we are in constant dialogue with the government as to how best we can all achieve our aims. We need to continue rolling out our services to areas where people have the least ability to pay and where the requisite infrastructure for us to do business may not exist.Baffour: What are the current – and future – challenges in terms of growth?Arafeh: As I said before, we need to continue with our aggressive network rollout drive so as to ensure that our customers all over Tanzania have improved access to communication services. We, however, take cognisance of the fact that in some of these areas we will have to fund the setting up of basic infrastructure. We will, therefore, see a decline in ARPus (average revenue per user) as we mine deeper into these areas. We have no doubt that we will be able to come up with adequate communication solutions for these areas depending on their consumer profiles, ie, community phones, low cost handsets, etc.Baffour: What is your policy on Corporate Social Responsibility?Arafeh: Celtel believes in supporting the community and does so mainly through supporting education with its “Build our Nation” programme which aims to provide teaching aids to secondary schools. The programme was launched in May 2004 and by the end of 2007, will have spent over US$400,000 to support 306 secondary schools in the country.

Celtel also undertakes the Celtel Scholars Programme annually which gives university education scholarships and working experience with Celtel for some of Tanzania’s brightest students. Celtel has most recently launched the “Celtel Africa Challenge” (www.celtelafricachallenge.com) which is a television quiz show that brings together some of the brightest university students from Tanzania, Uganda and Kenya vying for over US$300,000 worth of prizes for the students and their respective universities.

Celtel is also an active sponsor of major music events (Kilimusic awards, Fiesta) and conducts the biggest promotions in the country, offering millions of Tanzanian shillings to its customers annually (Win your dream/ home/farm). g NA

Left: Bashar Arafeh, MD, Celtel Tanzania: “We offer a service – communication – that is today a vital need and not a luxury”

BARRICK GOLD TANZANIA

Partnering with communities

Creating jobs

Investing in Tanzania

Building skills

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Agriculture Still waiting investorsThere is every incentive to double agricultural production in Tanzania. “We are, thus, looking for investors who can bring in good seeds and also irrigation, because our agriculture is very much rain-dependent.”

The government of Tanzania has adopted an Agricultural Sector Development Strategy (ASDS) which sets the framework for achieving the sector’s objectives

and targets. Agriculture remains the largest sector in the economy and hence its performance has a significant effect on output and corresponding income and poverty levels.

The sector accounts for about half of GDP and exports, and its importance is amplified through backward and forward linkage effects. Sale of agricultural products accounts for about 70% of rural household incomes.

Over the 1990s, average agricultural growth was 3.6%, which was higher than in the 1970s and 1980s when annual agricultural growth averaged 2.9% and 2.1% respectively. In 2004, agriculture grew by 6%.

In the 1990s, agricultural exports grew at an annual rate of over 7% per year, although this rate has slowed down in recent years due to declining world market prices.

Food crop production has also grown at a rate of 3% which is about the rate of population growth and accounts for about 65% of agricultural GDP, with cash crops accounting for only about 10%. National data show significant progress towards the objective of a sustained 5% growth rate.

Higher and sustained agricultural growth is needed to meet the government’s National Strategy for Growth and Reduction of Poverty (NSGRP also called Mkukuta in Swahili), and the UN Millennium Development Goals of halving poverty and food insecurity by 2015. There are four main reasons for this:

About 80% of the poor live in rural

areas and agriculture accounts for 75% of rural household incomes, hence significant reductions in overall poverty levels, particularly rural poverty, will require raising agricultural incomes.

Agriculture accounts for about 46.2% of Tanzania’s GDP (2004 figure) and for about 50% of exports. Agricultural growth has a larger direct impact on GDP growth than comparable growth in other sectors.

Agriculture stimulates economic growth indirectly through larger consumption linkages with the rest of the economy than other sectors. For example, Tshs1,000 of new household income from export crop sales can lead to an addition of Tshs2,000 in local employment in the production of non-tradables.

Meeting the country’s food security needs in both rural and the expanding urban areas requires higher agricultural growth contributing to higher incomes and lowering food prices.

At an aggregate level, agriculture has performed relatively well over the late 1990s and early 2000s. The recent improvements

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“eighTy per cenT of TAnzAniA’s AgriculTurAl exporT revenues come from five crops”

Eighty per cent of Tanzania’s agricultural export revenues come from five crops: coffee, cashew nuts, cotton, tea and tobacco


Will you invest in a young African leader?

www.ismoshi.org

If you or your company are interested in investing in some of Tanzania’s most talented young people, please email [email protected] for an information pack.

Currently receives generous support from Barrick Gold Corporation Tanzania (Bulyanhulu Gold Mine) and KLM Royal Dutch Airlines.

The International School Moshi Scholarship Programme: Covers the full cost of tuition and boarding for gifted Tanzanian young people as they study for their two-year International Baccalaureate Diploma

Selects from the most academically talented young people in the country through our partnership with the NGO, TanEdu

Prepares Tanzanian young people for further study at some of the world’s top universities, currently Harvard, Duke and Amherst

Is the only school scholarship programme in Tanzania to prepare teenagers for future senior leadership positions in East Africa

“There is a crisis of leadership in Africa. The result is continued poverty for millions of men, women and children.” The Africa Leadership Initiative

“I believe that when you help someone out, you also instill in him a sense of responsibility and, if he gets a chance to share what he has, he’ll do it willingly.” Nicholaus Mollel, Scholarship Student at International School Moshi, now studying at Amherst University


www.ismoshi.org









How do you prepare talented young people to become Tanzania’s future leaders?

This is the question that International School Moshi in the Kilimanjaro region of Tanzania is attempting to answer through its Student Scholarship Programme.With generous support from Barrick Gold Corporation Tanzania (Bulyanhulu Gold Mine), KLM Royal Dutch Airlines and parents’ tuition fees, International School Moshi has offered nine scholarship students from across Tanzania the opportunity to study for their International Baccalaureate Diploma.Scholarships cover all costs associated with the students’ study, including tuition, boarding and co-curricular activities.

Through a partnership with TanEdu, a Tanzanian NGO providing educational information and services, International School Moshi is able to offer scholarship places to students who have excelled in the national Form Four examinations.One of those students, Stephen Lwendo, who took up a scholarship place at International School Moshi in 2004, gained 42 out of a possible 45 points in his International Baccalaureate Diploma last year and is now studying engineering at Harvard University on a full scholarship.

“Currently in Tanzania, natural leaders do emerge but mostly through personal struggle and determination,” says International School Moshi’s Development Officer, Anne Wilshin.“So how do you enable those talented young people, standing on the bottom rung of the socioeconomic ladder and struggling just to meet their own basic needs, to excel academically and become this country’s future leaders? At International School Moshi we are trying to answer this question by offering scholarship places to students whose parents cannot afford to educate them beyond primary school.One of our current scholarship students is the first person from his community to attend secondary school in fifteen years. Mhula takes a twenty-eight hour bus journey to reach our school from his village, where his parents are subsistence rice farmers. He is academically gifted and totally committed to helping his local community.How would Tanzania be able to use his talents in the future without initiatives like this?Investing in education across Tanzania is extremely important – and at the same time, Tanzania needs home-grown leaders now to guide the country’s development efforts.Our scholarship programme is helping those future leaders to develop their academic potential, global perspective and sense of personal direction.”

Although the scholarship programme has only been running since 2003, International School Moshi is confident that those graduates currently studying in the USA will return to Tanzania after finishing their degrees. Boniventura Mwapule, an International School Moshi scholarship student now at Duke University, plans to return home to work on economic policy, and agrees that “Tanzania needs people like me to come back and help.” Ms. Wilshin adds, “Tanzania has a very good track record of students returning here after completing their education – people really do want to come back and make a difference. Through the International Baccalaureate curriculum that we teach, we encourage our students to learn from different perspectives and to bring that learning back to their own community.Our scholarship students want to repay the investment they feel people have made in them – and if their track record is anything to go by, I imagine they will even exceed their own high expectations.”Watch this space.

For more information on International School Moshi’s Scholarship Programme, see their advert on p.64.


www.ismoshi.org










are attributed to improved farmer incentives with marketing liberalisation in the mid-1990s, particularly for export crops resulting in farmers receiving a higher share of the world price, and technological change, particularly for traditional food crops which account for three-quarters of agricultural GDP.

Agricultural export revenue increased rapidly from 1990 to 1999, but then weakened, particularly for coffee and cotton, with declining world prices.

Eighty per cent of Tanzania’s agricultural export revenues come from five crops: coffee, cashew nuts, cotton, tea and tobacco, with traditional cash crops accounting for about 10% of agricultural GDP. In recent years, there has also been significant growth in horticultural exports, particularly cut flowers and vegetables.

The main goal of the government’s agricultural programme (the ASDS) is to give farmers better access to, and use of, agricultural knowledge, technologies, marketing systems and infrastructure – all of which contribute to higher productivity, profitability and farm incomes. ASDS also aims to promote private investment based on an improved regulatory and policy

environment. The programme has a 15-year horizon and is national in scope. But it will be phased in a flexible manner to allow all local government authorities time to adjust to the new funding mechanisms and to manage the proposed reforms.

The programme is costed for seven years from 2006/7 to 2012/13. The seven-year period is divided into a three-year first phase (which started in the first quarter of 2006) and a four-year second phase. A review of the programme’s performance will be undertaken at the end of the first phase.

So far, the programme’s performance has received mixed reactions. Emmanuel ole Naiko, the executive director of the Tanzanian Investment Centre (TIC), the agency that promotes investment opportunities in the country, thinks there is room for improvement as agriculture has so far attracted less than 5% of the total investors coming into the country.

“There is no reason why Tanzania should not be a net exporter of agricultural products,” the TIC boss says, emphasising that agriculture “is pulling the rest of the economy down. That’s why sometimes when you speak to the World Bank and so on, they talk about the low taxation ratio and

revenue collection in the country. Revenue collection is low because we’ve got a large number of people in agriculture who don’t pay taxes. Agriculture’s contribution to the tax basket is very, very low.”

To solve the problem, the government, according to Naiko, wants to modernise agriculture by encouraging the development of large commercial farms.

“If you look at cotton production, for example” Naiko says, “our average yield per hectare is 600 kilos. You go to Zimbabwe, with all the troubles they have had, they still produce 1,200 kilos per hectare – twice as much as we are doing. You go to Australia, it is 4,000 kilos per hectare.

“So in Tanzania, there is every incentive to double our production. We are, thus, looking for investors who can bring in good seeds and also irrigation, because our agriculture is very much rain-dependent.” g NA

Foreign aid still constitutes 40% of Tanzania’s “development” budget which goes into the building of the general infrastructure as opposed to the “recurrent” budget

which finances government procurement, payment of salaries, and other day-to-day expenditure.

According to the finance minister, Zakia Hamdani Meghji, the recurrent budget is now 100% financed by Tanzania. “Previously we even used to depend on donor money to pay salaries. Fortunately we don’t do that anymore,” the finance minister told New African. “We definitely need donor funding even now, but we are trying to scale

it down. Tanzania now owns the development agenda, and we are more focused. All the support from abroad is now geared towards the national poverty reduction programme called Mkukuta in Swahili.”

According to her, the economic growth and stability of the last few years, and the improved revenue collection and enhanced foreign direct investment since President Kikwete’s government came into office, have made it possible for the country to now finance the recurrent budget on its own.

She says that when the new government came into office, it set itself a target of Tshs157bn tax collection per month. It was later revised to Tshs200bn a month, but in

February this year it collected Tshs259bn. “We have widened the tax base,” she says, “and what really pleases me is that the compliance rate has increased considerably. People and businesses are now happy to honour their tax responsibilities. It is important that we become self-sufficient in the development budget. And we are on course.”

She adds that today, instead of the 80 large taxpayers in the country who used to be seen as the cash-cow, the number is now 160. And as the economy grows, import cover has increased from two months to six months of foreign currency. It used to be eight months import cover until last year’s drought and power cuts caused problems for the economy. “Despite these short-term problems,” she says, “we are achieving our micro-economic targets. Inflation used to be high, but it is now down to 4.9%.”

Debt cancellation (especially from the IMF) has also made an impact on the economy. Money released from debt cancellation has gone into the provision of energy and food, but other debt cancellation funds from the World Bank and the African Development Bank are yet to be received, due to long-drawn procedures of the two banks.

On the domestic front, laws strengthening the fight against corruption have been tightened and a new anti-corruption bill going through parliament will give extra bite to the battle. The media have also helped in exposing corruption.

The government has also increased salaries (the minimum wage is now Tshs84,000 a month, it was Tshs44,000 in 2005, and increased to Tshs65,000 when Kikwete’s government came to power in December 2005). Though the IMF and World Bank were not too happy with the increases, the government felt it had to do so to retain skilled people in the country, instead of seeing them migrate to greener pastures.

“So far,” says the minister, “we are very happy with the performance of the private sector. It is the engine of growth; we are working closely together, and they are complying with their tax responsibilities.” g NA

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finance minister ‘we are on course’In the past, Tanzania was heavily dependent on donor funding to run its affairs, even to pay government salaries. Now no more, thanks to the determination of President Kikwete’s government to be self-sufficient. Baffour Ankomah reports.


Finance Minister Zakia Hamdani Meghji: “We have widened the tax base… . It is important that we become self-sufficient in the development budget”

Golden Tulip – The place to be

The Golden Tulip Dar es Salaam is situated in the tranquil green area of the Msasani Peninsula. The seaside location gives guests a fantastic view of the

Indian Ocean. The architecture is inspired by the Arabic influences of the Swahili Coast and provides a luxurious atmosphere.

The entrance hall is spectacular with its stately pillars, rotunda and grand dome. The hotel offers a wide variety of business and leisure facilities. Its modern banquet rooms are perfect venues for meetings, seminars, cocktail parties, dinners and other business functions for up to 500 people.

The fine dining restaurant “Sanaa” (Swahili word for art) is situated on the first floor and offers modern fusion cuisine.

The Infinity pool helps guests to relax amidst the fantastic Indian Ocean horizon all around. It is the largest and most exclusive swimming pool in the whole of Dar es Salaam. The pool surface majestically

blends in with the horizon of the Indian Ocean. Massage, manicure and pedicure are available by the poolside every weekend. Various conference packages are available to suit the needs of guests. Arrangements for small groups and special demands are also available. Special indoor and outdoor venues are available for high level meetings, cocktails and dinners.

In total, the hotel has 84 well-appointed full-sized rooms of 38 square metres each, four executive suites, two diplomatic suites and one Presidential Suite. All rooms and suites have sea views with private balcony and offer all the comfort any guest would expect. Many African presidents, attending conferences and summits in Dar es Salaam, have stayed at the hotel. All rooms are air-conditioned and have satellite television, data ports, large writing desks, safe, direct dial international telephone, internet connection, and tea/coffee making facilities.

The hotel has the largest Presidential

Suite in Tanzania (260 square metres of comfort, overlooking the Indian Ocean and the skyline of Dar es Salaam). This famous suite has hosted heads of state, celebrities, newlyweds, and guests who appreciate comfort, quality, discretion and security.

The hotel also offers two Diplomatic Suites, both 125 square metres in size. These suites offer the perfect accommodation for the well-seasoned traveller and have a full ocean view and balcony. Each suite consists of a bedroom with bathroom/jacuzzi and a living room combined with a fully equipped kitchen, dining area and guest bathroom.

The hotel also has four Executive Suites, each 60 square metres in space which offer the ideal accommodation for the traveller in need of a living room and a comfortable bedroom. A private terrace on the ocean side adjoining the garden offers a relaxed environment for any length of stay, and visitors can be received through a separate entrance. g NA


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The green revolution takes rootProf Mark Mwandosya, Tanzania’s environment minister, talks to Baffour Ankomah about the quiet green revolution going on in the country which has seen 100 million trees planted in the p ast four years.

Baffour Ankomah: What’s your green policy like?Prof Mark Mwandosya: I like your term ‘green policy’; we call it ‘environment policy’. But it is a green policy all the same. And let me start with a disclaimer: Things are not as beautiful as you think. I don’t want to give ourselves too much credit, because we may relax and believe that everything is fine. If you travel to the interior of the country, you will find that a large part is dry land and semi-desert. The biggest challenge for us is to control that situation. The lush green you see in Dar es Salaam and along the coast is because of the humid conditions of the Indian Ocean affecting the vegetation. That’s why Dar es Salaam is green almost throughout the year.

But let me talk about the national environment policy. In the 1990s, everybody was doing his own thing, so we decided as a nation to focus our efforts under a national environment policy to act as a guide about the challenges, and what we should do and who should do it.

So we promulgated that policy through a participatory process, starting from the grassroots, talking to people about what they thought were the challenges and what they were going to do about it. It was a national consensus. We then moved a stage further in 2004 and came up with an all-embracing law, called the National Environment Management Law. Every aspect of national development has some kind of element related to the environment – be it water, health, agriculture, mining, you name it. So we wanted a law which would be an umbrella law that assigned responsibilities to every sector of national life.

Last year we came up with a landmark strategy which was a departure from everything we were doing before, by focusing on the conservation of land and water sources. If you had come last year, you would have found Dar es Salaam very dry. It had been so for two or three years. The nation was facing a very critical time.Baffour: Was it because of the drought?Mwandosya: It was because of the drought leading to severe power rationing which has contributed to economic problems in terms

of a drop in our GNP growth. But we’ve had a lot of rains this year and things have changed. We have now defined 12 challenges in the national strategy for the conservation of land and the protection of water sources, including the invasion of water sources by livestock herders.

It sounds a bit draconian but we had to literally move thousands of herds of cattle particularly from wetlands, and in one important basin in the country, we had to move in excess of one million herds of cattle and resettle them elsewhere. The results have been very dramatic. All of a sudden, the water level of this protected wetland has gone up, so the wildlife has returned, and we see a dramatic change in the discharges from this wetland. It has been a major success. Of course, it was costly but we have succeeded.

Another challenge was in the way people cultivated, particularly the peasants who farmed as near as possible, almost encroaching on water sources, and also cultivating at the top of mountain ranges, the springs which are the sources of water. We also did something drastic about this and defined the altitude at which farmers couldn’t cultivate in the highlands, and also the distance beyond which they couldn’t

cultivate along river banks. We then tackled the big problem of trees, because as I said earlier much of the country has little tree cover, particularly the central parts. First of all, we increased our efforts in tree planting, the creation of tree nurseries, and encouraged people to plant trees. We emphasised not only planting but making sure that the young trees survived and were protected. We then brought in competition among villages, schools, districts, etc, to encourage them to look after the trees.

We also tackled tree felling. If you go to many construction sites, particularly in Dar es Salaam, many contractors use wooden poles to support their scaffolding. And these are young trees that they have cut to hold the scaffolding. So we are working with the architects’ and engineers’ associations and building contractors to change that mode of construction. We want them to use steel poles, and if they should use wooden poles at all, they must come from tree plantations because that is renewable in a sense.

We also know that we can’t succeed if we don’t work with the people. So awareness creation has been the centrepiece of our strategy. To me, the most important part of my work is working with the people, creating awareness, talking to them, using the media, planting trees and being in the forests with them. Baffour: So how many trees have you planted so far?Mwandosya: Countrywide, we have planted 100 million trees in the last four years. Last year we upped the ante, and decided that every district will have to plant a minimum 1.5 million trees and make sure that the trees survive. And we have 134 districts. Our district and provincial commissioners are overseeing this programme.

But there is something more: The president has said that tree planting and tree survival are too important to leave to the system and hope they will work. So he has instituted a prize, the “presidential prize for tree planting, tree protection, and the conservation of water sources”. There will be competition among the districts and hopefully we want to go right down to the villages. The target is a minimum

Environment minister, Mark Mwandosya: “If you don’t plant trees, I don’t come to your function”



of 1.5 million trees planted, survived and protected every year. We will give special attention to those who plant indigenous trees as opposed to exotic trees or invasive species.

We are doing this for the first time. The prize was instituted last year, but our year starts from July to June, so the president will give the best prize annually on 5 June, which marks World Environment Day. The president will also give a prize to the mining industry, to encourage competition, awareness and a sense of responsibility for environmental protection by the mining companies.Baffour: I also hear every New Year’s Day is tree planting day in Tanzania?Mwandosya: It is called “tree planting day” but we always remind people that if the president plants a tree on 1 January, he signals tree planting as an activity for that year. So people should not think that “well we planted the trees on 1 January so we go to sleep for the rest of the year”. No, I remind them that it is not a “tree planting day”, it is the beginning of the “tree planting season” wherever you are.

Yes, tree planting has changed the face of Dar es Salaam. You see a lot of nurseries along the roads, and wherever there are nurseries, the place is green because nursery owners actually plant the different

seedlings to show to their customers what trees they have on offer. And we have thousands of them in the city, helping to make the city look green. It is remarkable. I really have great respect for the nursery owners.Baffour: I am told that in the past Dar es Salaam wasn’t this green.Mwandosya: I would say it happened over the last 10 to 15 years. Baffour: And I hear it was one of your former prime ministers who really pushed tree planting as a big-time activity.Mwandosya: Well, if we are to apportion credit, I will say one of the greatest environmentalists who ever lived in Tanzania was Mwalimu Nyerere, our first president. His speeches on the environment were remarkable, and he himself had great interest in plants. He was fantastic. The other day I played back one of his speeches on the environment, and I said, “Oh, I don’t need to say anything, I just have to switch on this speech and sit back.”Baffour: But you said 10 to 15 years ago, Dar es Salaam was not this green. Doesn’t

it mean that, although Mwalimu Nyerere may have given great speeches on the environment, not much was achieved practically under his long reign?Mwandosya: Well, let me qualify the statement “10 to 15 years ago”. In terms of size and population, everything in Dar es Salaam has grown, including entrepreneurship which has evolved among the young people who have now established tree nurseries along the roads. But Mwalimu was the driving force. The speech that I listened to two days ago, he gave it in Dodoma in 1996, at the national seminar on the environment. He used to give those speeches all the time. Perhaps what we see now is the result of what he was talking about.

So whatever I do, if I am invited to a function in Dar es Salaam or in a village, I make sure that tree planting is on the agenda or I don’t come. Now they know that the event could be unrelated to trees, but it must include tree planting as an activity. In fact, it has become instinctive – “If you don’t plant trees, I don’t come to your function”. g NA

Trees have changed the face of Dar es Salaam

“counTrywide we hAve plAnTed 100 million Trees in The lAsT four yeArs”


Documents

Tanzania A country on the march - New Africannewafricanmagazine.com/archive/images/pdfs/Tanzania/tanzania... · beyond the Kenya border. The volcanoes, all but one, ... grassland