EVERY SECTOR ALONG FOR THE RIDE

Tanzania 2018 | INDUSTRY & MINING | INTERVIEW

TBY talks to Hon. Charles Mwijage, Minister of Industry, Trade and Investment, on how to reach middle-income status, employing the private sector toward this end, and what sets the country apart from the rest of East Africa.

Hon. Charles Mwijage
BIOGRAPHY
Hon. Charles Mwijage was born in 1960 and graduated from Salford University in the UK with a master’s in business administration. He is currently the Minister for Industry, Trade and Investment. He previously held positions at Chevron, Cyclone, Gasco, and the Tanzania Petroleum Development Corporation.

The government is entering its second year of its second Five-Year Development Plan (FYDPII). What is driving this?

The main goal of the plan is to enable Tanzania to become a medium-sized economy by 2025, underscored by industrial production. The government's decision was inspired by a desire to create integrated and sustainable development through all available resources and offer a wide range of sustainable opportunities and employment. It is also true that industrial economies need to be more effective in overseeing and implementing investors' interests, rehabilitating and protecting domestic industries, and combating the power of unfair competition in the market.

How important is the role of the private sector for attaining these industrialization goals?

In the construction of industrial economies, the private sector is crucial, and the government needs to ensure it encourages existing opportunities and investments in trade and marketing. It must provide space for public-private dialog. Furthermore, the private sector is instrumental in spurring improvements in production techniques, developing and harnessing modern technologies, and boosting human resource capacity with professionals across every sector. This stimulates progress for all. Thus, the government depends on the private sector to support policies, programs, strategies, laws, and regulations that protect the interests of the nation. We are also cooperating with the private sector to develop and strengthen research institutions such as the National Development Corporation (NDC) and the Export Processing Zones Authority (EPZA).

Have you seen an increase in industrial activity in the past 12 months?

Between 2016 and March 2017, the government successfully registered 242 different sector projects worth USD926,000. These are expected to provide up to 17,385 new jobs. Of these projects, 170 are industrial, 54 in construction, and 18 more in various fields across the board. In 2016, industrial production rose by 7.8%, compared to 6.5% in 2015. This growth was mainly due to an increase in the production of food, beverages, and tobacco products. The industrial sector's contribution to GDP was 5.1%, remaining fairly constant from 5.2% in 2015, though the industrial sector as a whole has generated 146,892 jobs, compared to 139,895 jobs in 2015. This was brought about by investments in the expansion and establishment of new industries.

How does Tanzania compare to its East African neighbors in terms of attractiveness for investors?

Our investment sector has continued to grow and is faring better than many other East African countries. The 2016 UNCTAD report shows that Tanzania attracted USD1.5 million in 2015. Similarly, the Quantum Global Investment report on 54 African countries ranked Tanzania ahead of Kenya and Uganda. Tanzania was number eight in terms of economic growth, financial flows, currency exchange, business environment, mass population, and technological and creative use in Africa. What's more, World Bank statistics show that total GDP growth has gone from 14.8% in 1997 to 31.3% in 2015, compared to the African average of 21-22% and the developing country average of 23-25%.

What is the status of the special investment projects outlined by the ministry?

We have seen an acceleration of internal investment from the Tanzanian Social Security Association (TSSA) as well as six social securities funds, which have been earmarked for 25 special investment projects in diverse sectors: textiles; commodities like tea, wine, and sugar; and metal molding. The PPF pension fund and the National Social Security Fund (NSSF) have joined forces to develop a sugarcane plant; the PPF has entered into a partnership with Karanga Prison for shoe fabrication; the LAPF pensions fund is investigating possibilities of investing in a tea fertilizer factory; and the GEPF pension fund has signed an investment agreement with the Dodoma wine factory, and invested in the construction of a metal molding machine at Kilimanjaro Machine Tools Corporation (KMTC) in Moshi. These projects are well on their way to being realized and, once complete, will contribute considerably to the manufacturing and value-adding arm of the state's industrialization strategy.