22.1.2020 klo 16:10
Interview with H.E. Dr. Willibrod Peter Slaa Ambassador of the United Republic of Tanzania in Stockholm
Economic outlook of Tanzania today – and what are the prospects for the country?
Tanzania is one of the African countries with fast growing economies. This is evidenced by the reports of World Bank and the African Development Bank.
The future is very promising. This can be seen by very vibrant economic activities particularly – infrastructure sector whereby the country’s regional capitals and district capitals are being connected by tarmac roads. Rural roads are being constructed to gravel level. Unfortunately, excessive rainfall since October 2019 washed away many bridges.
The 1500 km Standard-gauge railway (electric) that will link the country from dar to Mwanza on Lake Victory and across to Uganda, Rwanda, Burundi and Democratic Republic of the Congo is progressing very well. From Mwanza it takes only six hours to Dar by electric train (160km/h to start with for passengers’ trains and 120 km for goods train).
Inlands there is an ongoing construction of both passengers and goods boats to boost up intra and inter- lakes trade e.g. on Lake Victoria, Lake Nyasa and Lake Tanganyika. This opens up to the eight landlocked countries thus opening up to a huge market close to 450 million people. This is a huge economic potential, and in fact opening the doors to Africa Free Trade Area with a total population of close to 1.2 billion people. There can’t be an opportune time for investing in Tanzania which is expected to serve as a hub when all infrastructure projects are completed.
Tanzania is now focusing on industrialization, as no country has ever progressed with focus only on agriculture. Tanzania has from Independence been basically agriculture-based country. The policy is now to move from dependence to development assistance to industrialization and business promotion. This is specifically the case with our Nordic countries including Finland. Development co-operation will continue but in the long run business investments and trade are more sustainable as they are more people to people oriented.
Major investments in industries to happen, the government of Tanzania is building a major hydropower dam that is expected to produce 2,115 MW of electricity. This will bring the total installed capacity to over 3,500 that is double the current capacity. This will be enough for the SGR railway line and the industries under construction. The overall goal is to have in 10 years a total installed capacity of 20,000, which will be a combination of hydro, gas, wind and solar energy which are all abundant in the country. This is naturally a conducive environment for major investors as reliable power is a major handicap in most African countries.
The government is putting significant resources in education from free education up to secondary school level (gymnasium and college) and is also heavily funding university education in the form of education loans at university levels. At this particular time emphasis is on science subjects in order to create skilled base for industrialization as stated above.
District and regional hospitals are at different levels of construction as well a health centres and dispensaries up to village level as the current government realizes that you can’t have a well-functioning society unless you have a healthy population.
You may see how all these programs are well knit together to indicate the status of the economic growth of the country.
Which kinds of business opportunities are there for Finnish companies? Please, explain us also which kinds of investment opportunities there are for Finnish companies in Tanzania?
Finland has a very long-standing relations basically going back to pre-independence period. Since independence, Tanzania has very much enjoyed support of Finland through development cooperation, including support in the area of education (in particular adult education), afforestation program (a huge forestry program in Mufindi Njombe Area in the Southern Highlands of Tanzania, health program and electrification programs.
The government of Tanzania is now redirecting its partnership with the Nordic countries including Finland in the areas of business investments. The Finnish investors are now beginning to focus on Tanzania. The opportunities for investments are countless. To mention a few, are areas such as information technology, education programs, pharmaceutical industries, industries that add value to all types of agricultural products such as wheat, maize/corn, all types of tropical fruits, forestry products, paper industry, heavy industry such as production of all types of agricultal equipment and implements, and fish processing and all types of mineral processing plants. The sky is literally limit. We are in the process of putting together a business delegation to go Tanzania to meet with their colleagues the Tanzania business community.
To create conductive business environment, Tanzania has created a “ one stop centre” for business registration under Tanzania Investment Centre (TIC) accessible online; it has just published an investment Blueprint, and in February 2020 a number of legislative amends will be presented to Parliament thereby creating conducive business environment. It should be understood, that since independence of Tanzania has all through been a socialist country and in the late 1990s it adopted market economy, unfortunately without creating appropriate regulatory frameworks. That is the reason why a lot of legislative amendments are taking place so that the country may also benefit from the abundant resources.
If a Finnish company decides to invest in Tanzania, what are the most important issues this enterprise must take into its consideration to succeed in the market?
For a Finnish business to invest successfully or do successful business, these are few important steps to do:
- Just google: Tanzania/ Investment Centre and you will access Tanzania investment portal. It will direct you to various subheadings. Inform yourself properly. You can also access the portal from Embassy of the United Republic of Tanzania in Nordic Countries, Baltic States & Ukraine (Stockholm, Sweden)
- Before you start business start by educating how to start business in Tanzania. Please get all the relevant forms online. Fill all forms carefully and return them to get instructions from Tanzania Investment Centre on how to proceed. Please do note that for foreign investors it is mandatory capital investment of not less than $ 500,000. (Not cash but in the form of land – in case you will have to buy land, capital for investment and basically startup costs depend on the nature of the investment. You may need to register specifically with TIC to benefit specific TIC exemptions and benefits all accessible online)
- If you physically visit Tanzania, please do make sure you do not fall prey to bad middlemen (conmen). Rather get assistance from your local embassy office in Dar. They will give you objective assistance and support you while visiting but also travelling to Dar. Do call for assistance from our embassy in Stockholm and we shall provide you with the necessary support.
- Please note that the current government has a zero-corruption tolerance. Under the table deals are completely not tolerated (you may encounter some situations such as tips, bribe etc. as it is not 100% possible to wipe out corruption within a span of short time). Do not entertain any of these.
- Transparency is the only way to succeed. Follow the regulations, pay government taxes. When you have a proposal please see the appropriate government level to get a solution to your problem.
Which kind of assistance and which kinds of benefits there are in Tanzania for Finnish companies which would like to invest in Tanzania?
Once a company is registered with TIC and or the Economic Export Processing Zone (EPZ) you are entitled to the reliefs thereby offered. Tanzania and Finland have a business treaty and you are entitled to the reliefs protected by it. You may access it from the Norwegian Foreign Ministry.
Please, explain us how Tanzania has benefited from the free trade agreements?
Free trade agreements are beneficial to the parties. As per terms specified in the respective free trade agreements. Tanzania is currently a member of the EU/ ACP free trade agreement (including Finland), expiring 2020. A new agreement is currently under negotiations.
We know Tanzania as a great holiday destination for Finns. Please, tell us more about the tourist attractions and holiday resorts in your country.
Tanzania is a holiday destination for the Finns. This is based on the following:
- Tanzania is a home to the world-famous Serengeti National Park and the Ngorongoro Crater, one of the Seven Wonders of the World.
- Tanzania is a home to natural great white beaches of Zanzibar (an autonomous part of the United Republic of Tanzania).
- Tanzania is a home to snow-capped Mount Kilimanjaro, the world’s 6th highest mountain in the world and the roof top of Africa, being Africa’s highest mountain.
- Tanzania in total has 22 national parks, four new ones just recently created. All national parks have each unique characteristic such as the tree climbing trees of Lake Manyara National Park. All these together make Tanzania an unforgettable destination. Tanzania is a very peaceful, has a hospitable population and politically very stable.
All these factors, together with the long-standing relations between Finland and Tanzania, naturally makes Tanzania a great tourist destination to many Finns.
Contact person for questions:
Liaison Manager, International Affairs
Finland Chamber of Commerce