Dar es Salaam — Tanzania’s economy has been growing at a satisfactory rate but the country must promote several areas for the growth to have an impact on poverty reduction endeavours amid global uncertainties, the United Nations has said.

In its Development Assistance Plan 2016 -2021 Report – which was launched in Dar es Salaam recently – the United Nations calls upon Tanzania to ensure that it puts emphasis on growth of areas that will have a a quick impact on the population.

The areas include tourism, agriculture and in building productivity of the micro, small and medium enterprises.

“The country must provide openings for upgrading the tourist sector and branding the country as destination of choice with focus on promoting natural beauty, historical and cultural heritage of Tanzania mainland and Zanzibar,” reads a statement in the report.

Tanzania, the UN says, must take advantage of the high rates of return on investment in social sectors by addressing challenges of equity, quality and scale. That can be done by investing in building productivity of the micro, small and medium enterprises (MSMEs).

The MSMEs must be helped through increased access to finance, business development services and training.

“Similarly, the country must invest in productivity to provide measures for agriculture and development of agro-industries which have enormous potential given that 80 per cent of agricultural exports were currently not being processed in the country,” the report reads.

Most of the coffee beens come to the world market from African countries like Ivory Coast, but few companies roast and package them locally.

However, things started to change slowly and some of the Robusta variety is now being processed for local consumption.

“International brands are coming to Ivory Coast. They have understood and realised the potential of this market because we are having a dynamic boom in our economy which attracts a lot of people,” says Fabieenne Dervain of Couleur Cafe Abidjan.

Dervain is selling quality Ivorian coffee processed in Abidjan to wealthy Ivorians. She believes that if it is prepared and blended correctly, it is far superior to any other variety of coffee. It is also more affordable.

Bakayako Lamine, an Ivorian coffee brewer, says: “[Ours is] a type of coffee that is a bit bitter and coarse and yet so flavourful. It’s good.”

Famous coffee brands are also increasingly mixing Ivorian coffee with the more expensive and harder to find Arabica variety.

Arabica is considered to be smoother with complex flavours, but it is a more fragile plant. Robusta makes up about 30 percent of global coffee production.

The government mulls coming up with a new law and regulations that will compel privatised firms to enlist at the Dar es Salaam Stock Exchange (DSE) if they fail to do so voluntarily.

The move aims at encouraging transparency and good corporate governance; hence making tax administration task easier while enabling citizens to participate in economic activities. For instance, some of the listed companies feature in the 15 largest taxpayers and quality employment provision list; namely TBL, TCC, NMB, CRDB Bank, Simba Cement, Twiga Cement and TOL Gases.

The Minister for Finance and Planning, Dr Philip Mpango, said the same mechanism (mutual talks) used to list seven privatised firms at the DSE would be applied to other firms that had not been listed. “If the mutual talks fail, then the government will push them to offload some of their shares at the DSE,” Dr Mpango said during the official self-listing of DSE shares at the bourse.

He noted that although the government had stakes in some of the privatised companies, it will offload them strategically to avoid harming their operations. “We do not only want Tanzanians to buy shares in those companies and boost their welfare but we also need to openly see the companies’ operations and proper determination of (our) taxes,” Dr Mpango said.

Earlier, DSE Chief Executive Officer (CEO) Mr Moremi Marwa said more than 400 state-owned enterprises (SOEs) had been privatised in the last two decade out of which only seven made their way through the capital market.

“We only wish if at least 10 per cent of the privatised companies were privatised through the exchange — we would have over 50 companies. The impact (of listing 50 firms) to our capital market and economy would have been significant,” Mr Marwa argued.

The CEO stated that learning through previous experience, “it is advisable that future privatisations are conducted through the capital market.” Capital Markets and Securities Authority (CMSA) CEO Ms Nasama Massinda said they were very pleased by the government’s move to require the telecoms sector to offload 25 per cent of their share by listing at DSE.

DSE yesterday self-listed after a successful initial public offer that saw it was oversubscribed by 377 per cent. The shares rally in the first day from 500/- at IPO to 800/- in just 20 minutes of listing. It is believed that the more attractive DSE becomes, the more enterprises and investors would come up to use the local capital market to support the industrialisation drive.

The new 18 per cent Value Added Tax (VAT) on tourism services would not harm the growth of the sector as it was carefully researched before it was introduced, a government minister has said.

The Minister for Agriculture, Livestock and Fisheries, Dr Charles Tizeba, said in Dar es Salaam yesterday that key stakeholders in the sector were consulted before the new tax was introduced and were satisfied that it would not cripple the sector which is leading in foreign exchange earnings in Tanzania.
Speaking during the inauguration of the Swissport cargo terminal, the minister appealed to members of public people to stop giving misleading information concerning the new tax measure because it may send wrong message to tourism stakeholders.
“The government is aware of the competitive environment among the East African Community member states and the country’s weaknesses and strengths in the sector, thus this matter should not be used to mislead people because it may send wrong signal to the stakeholders,” said Dr Tizeba, who was representing Minister for Works, Transport and Communication.
Mr Tizeba further explained that Tanzania’s tourism was different from other countries such as South Africa, Zimbabwe and Kenya noting that “while Kenya is leading in number of tourists visiting the country, Tanzania earnings from the sector were high compared to Kenya. He observed that, before the Finance Act was endorsed by Members of Parliament, key players were involved in every aspect as in budget preparation passed through various stages.
Expounding, Mr Tizeba said that the introduction of 18 per cent VAT on tourism was carefully researched and highly debated in the Parliament before being endorsed thus allaying fear expressed by some stakeholders that it would lower the number of tourists and negatively impact on aviation industry. In his remarks, Swissport Tanzania Plc Chief Executive Officer Mr Gaudence Temu informed the Minister that the industry key players were of the views that the newly introduced VAT on tourism services was likely to have negative impact on both tourism and aviation sector.

“This is because the tax is an additional cost given that it was not factored in tour packages some of which had already been sold one year ago,” Mr Temu said. He added that the tax was also going to erode the country’s competitiveness against its neighbours who have scrapped VAT on tourism services.

Describing the state-of- the-art Air-cargo import warehouse, he said it is one of its kind in Africa with fully secured environment, access control through turnstiles and biometric locks. The cargo facility has locations provided for handling special cargo such as room for live animals 17sqm, Morgue capable to store up to 4 bodies, vulnerable items storage room 64sqm, valuable storage room of 40sqm, radioactive room 12sqm and dangerous goods room of 65sqm among others.
Mr Temu however noted that by having the cargo import terminal Swissport will have now met the International Civil Aviation Organisation (ICAO) requirement for segregation of import and export cargo.