HEADS of poor performing public entities have to appraise their suitability as the government seeks return on its investments, Finance and Planning Minister Dr Phillip Mpango has reminded.
Speaking in Dar es Salaam yesterday, the minister raised concern over unsatisfactory performance of many state-owned enterprises, which have not paid dividend to the government, hinting that for the 2016/17 fiscal year, only four out of 34 government entities had issued dividend.
He said 20 out of 32 enterprises, which are jointly owned between investors and the government did not issued dividend to the government.
“For the heads of entities and their board of directors here, I would like to tell you in a harsh language that you must evaluate yourself,” Dr Mpango said at Uongozi Institute organised workshop on the role of state owned organisations in implementing the industrialisation agenda.
The government had as of June 30, 2017 invested 48.5tri/- on its enterprises, according to newly appointed Treasury Registrar (TR) Athumani Mbuttuka.
The minister said he has directed the TR to analyse and closely follow up on performance and leadership of all state owned enterprises to get rid of poorly performing entities as well as punishing the irresponsible individuals.
He has also ordered the TR to ensure that every parastatal required to contribute 15 per cent of its gross revenues to the consolidated fund does so.
Mr Mbuttuka said there are 270 public corporations and institutions in the country, with 232 of them wholly owned by the government.
The government has over 50 per cent stake in two corporations and 50 per cent share to four entities. It is a minority shareholder in 32 corporations.
The minister said massive investment in state owned enterprises implied that the government has great confidence in them.
The government was pleased with the contribution that some of SOEs were making to the industrial development efforts, with the minister citing pension funds, which have directly invested in the industrial sector.
He also praised Tanzania Roads Agency, Tanzania Railway Corporation, Tanzania National Electric Supply Company and Tanzania Ports Authority for their contribution in building the requisite infrastructure for industrialisation.
“I am also aware that some enterprises have invested in and support, in various ways, the industrial drive. I applaud them for the initiatives and ask them to keep up the good work,” he said.
He said industrialisation is on top of the government priorities in building a semi-industrial economy as envisioned in the national development vision of 2025 and second five-year development plan (2016/17– 2020/21), which put great emphasis on industrialisation as the tool for economic reforms.
Dr Mpango hinted that in between 2005 and 2015, the industrial sector contributed averagely nine per cent to the Gross National Product, adding that the sector’s contribution to foreign trade grew from 17 per cent in 2012 to 23 per cent in 2014, but fell to 19.1 per cent in 2015/16.
“This is a good contribution, but not enough…in our current plans, we want to ensure that the industrial contribution to the Gross National Product is over 10 per cent a year and about 30 per cent to foreign trade by 2020,” he said.