GREATER THAN THE SUM OF ITS PARTS
TBY talks to Libérat Mfumukeko, Secretary-General of the East African Community (EAC), on Tanzania's importance to the EAC, the major achievements of regional integration, and obstacles ahead of a monetary union.
BIOGRAPHY
Libérat Mfumukeko is a Burundian diplomat and civil servant. He was appointed to the position of Secretary-General of the EAC by the EAC Heads of State on March 2, 2016 for a five-year term.What are the mutual benefits of Tanzania's membership in the EAC?
The United Republic of Tanzania is one of the founding partner states of the EAC. Tanzania is also the home to a number of pioneer African nationalists and Pan-Africanists, foremost among whom is the late Mwalimu Julius Nyerere. Pan-Africanism is important in this context, because the EAC and other regional economic communities in Africa are all part of the African Union's overarching plan to form an African economic community by the year 2063. Tanzania, the second-largest economy in the region, has also played a crucial role in promoting political liberation and stability not just in East Africa but Africa as a whole. The EAC is, therefore, richer with Tanzania as a partner state.
What has been the impact, in real terms, thus far of the EAC's economic integration process, gaining momentum now for well over a decade?
In April 2016, the community attained international recognition as the fastest-growing regional economic community in Africa. This acclaim is a result of the major achievements in terms of the integration that the EAC has attained in the recent past. For example, the EAC is now implementing a single customs territory, which means goods are cleared only once at the entry point. This has resulted in the drastic reduction of the period taken to clear goods from over 20 days to three to four days on the central corridor; from 21 days to four days between Mombasa and Kampala; and from 18 days to six days to Kigali on the northern corridor. Also, of the 15 borders earmarked to operate as one-stop border posts, 11 have now been completed. Similarly, we are now in a common market, with free movement of people, goods, and capital. Laws have already been enacted in our partner states to ensure that citizens enjoy these freedoms, moving and trading freely.
What obstacles do you foresee along the way to achieving a monetary union between EAC member states?
A high degree of economic convergence is important for individual countries planning to form a monetary union. This aspect is also important for the stability of the monetary union once formed. The loss of national monetary and exchange rate policies by individual partner states after the formation of a monetary union, and the likely constraints on national fiscal policy in the single currency area underline the importance of starting from a position in which such a loss of national discretion in macroeconomic policy can easily be borne and will not outweigh the benefit of introducing a single currency. The major challenge on the road to a monetary union is the fact that the economies of the EAC partner states are too divergent to guarantee a stable monetary union. The macroeconomic numbers for countries like South Sudan and Burundi, for example, are extremely different compared to that of Kenya. In order to promote economic convergence, EAC partner states have agreed on a set of four primary convergence criteria that must be attained and maintained for at least three years before joining the monetary union: a ceiling on headline inflation of 8%, reserve cover of 4.5 months of import, ceiling on the overall deficit of 3% of GDP, including grants, and a ceiling on gross public debt of 50% of GDP in net present value terms. Another challenge is the slow progress that is being made in establishing the key institutions to support the monetary union. For example, according to the East African Monetary Union (EAMU) roadmap, the East African Monetary Institute was supposed to be established by December 2015. However, this was not possible, partly due to the lengthy process of decision making of the community as stipulated in the EAC Treaty and also because some sectoral councils do not meet as frequently as required. The secretariat is doing its best to ensure adherence to the calendar of meetings.
GREATER THAN THE SUM OF ITS PARTS
TABLE OF CONTENTS
Guest Speaker
Hon. Patricia Scotland, Secretary General, Commonwealth of Nations
TBY talks to Hon. Patricia Scotland, Secretary General of the Commonwealth of Nations, on the advantages of being a member of the Commonwealth, the need to celebrate diversity, and Tanzania's war against corruption.
read articleGuest Speaker
Libérat Mfumukeko, Secretary-General, East African Community (EAC)
TBY talks to Libérat Mfumukeko, Secretary-General of the East African Community (EAC), on Tanzania's importance to the EAC, the major achievements of regional integration, and obstacles ahead of a monetary union.
read articleInterview
Raymond P. Mbilinyi, Executive Secretary , Tanzania National Business Council (TNBC)
TBY talks to Raymond P. Mbilinyi, Executive Secretary of Tanzania National Business Council (TNBC), on its work to support the private sector in the country, tackling challenges in the economy, and clamping down on corruption.
read articleReview: Banking
The Quest for Depth
If Tanzania is to meet its 2025 vision of attaining middle-income status, it will need to corral its bank-centric financial and capital markets for greater depth by extending participation and rendering credit more accessible to SMEs, women, and the young to spur economic growth.
read articleInterview
Dr. Baghayo A. Saqware, Commissioner , Insurance, Tanzania Insurance Regulatory Authority (TIRA)
TBY talks to Dr. Baghayo A. Saqware, Commissioner of Insurance, Tanzania Insurance Regulatory Authority (TIRA), on achieving universal healthcare coverage, the brilliance of microinsurance, and how to partner with public and private entities to increase the industry's penetration.
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Legal Thunder
With the stepping down of Minister of Energy and Minerals Sospeter Muhongo in May 2017 over transparency issues and the introduction of three new laws that give the government the right to renegotiate or revoke existing mining and oil and gas rights, private players in the country are unsure of what future lies ahead. On the other hand, project-specific developments bode well for a sector in need of a breakthrough.
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Kapuulya Musomba, Managing Director, Tanzania Petroleum Development Company (TPDC)
TBY talks to Kapuulya Musomba, Acting Managing Director of Tanzania Petroleum Development Company (TPDC), on the planned expansion of the Mtwara-Dar es Salaam natural gas pipeline, entering northern industrial hubs, and empowering nascent industries.
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Marc Den Hartog, Managing Director, Shell/BG Tanzania
TBY talks to Marc Den Hartog, Managing Director of Shell/BG Tanzania, on the critical need for economies of scale, the importance of developing LNG for export, and why renewables must be taken into account in any long-term plan.
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Hon. Charles Mwijage, Minister, Industry, Trade and Investment
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.
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Discoveries of Magna-tude
Despite being the second most common element in the universe, helium is in short supply on earth. With global reserves of the gas steadily dwindling, and demand steadily increasing, the discovery of a whopping 1.53 billion cbm of helium in underground chambers in Tanzania could not have come at a better moment.
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Gilliard W. Ngewe, Director General, Surface and Marine Transport Regulatory Agency (SUMATRA)
TBY talks to Gilliard W. Ngewe, Director General of Surface and Marine Transport Regulatory Agency (SUMATRA), on transportation budget allocation and cross-sector dialog and partnerships.
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Jared H. Zerbe, CEO, Tanzania International Container Terminal Services Limited (TICTS)
TBY talks to Jared H. Zerbe, CEO of Tanzania International Container Terminal Services Limited (TICTS), on regional trade flows and Tanzania's potential to take a leading role in orchestrating cargo movement.
read articleFocus: Tanzania Strategic Cities Project (TSCP)
East Africa’s “Geneva”
If Rome wasn't built in a day, it is not surprising that Tanzania's project to revamp eight of its largest cities is entering its eighth year of implementation. A release of further funds from the World Bank has given the project a new lease of life.
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Lost in the Maize
Agriculture accounts for 30% of Tanzania's GDP, and the sector has experienced above-average output in recent years compared to the rest of the African continent. However, the sector's development is held back by poor rural farming practices and general infrastructure bottlenecks.
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Fred Kafeero, Tanzania Representative, Food and Agriculture Organization (FAO)
TBY talks to Fred Kafeero, Tanzania Representative of the Food and Agriculture Organization (FAO), on the organization's long-term support for Tanzania's development, recent initiatives in agriculture, and financing.
read articleFocus: 2020 Irrigation Target
Reap What You Sow
In 2006, the Tanzanian Ministry of Water and Irrigation set a target for Tanzania's agriculture sector: to irrigate 1 million ha of land by 2020. More than 10 years on and moving ever closer to the deadline, this target has not yet been met, though the first seeds are being sown.
read articleFocus: Southern Circuit Tourism
Hidden Gems
Tourism is frequently described as the jewel in Tanzania's economic crown. In 2016 alone, the industry contributed over USD2 billion in revenues. However, for at least three years, the government has expressed concern that tourism is not well distributed across the country.
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