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Call to speed up industrialization

Call to speed up industrialization

Analysts consider the industrial sector as the rolling stock of economic growth and development, employment generation and poverty reduction. 

Recent performance suggests that enhancing the pace of structural change, diversification and increasing international competitiveness of the economy remain the key challenges for sustainable growth.

As one of the developing nations, Tanzania is struggling to build and establish sustainable industrial sector that could become the engine for economic growth.

The newly appointed Minister for Industry, Trade and Marketing Dr Abdallah Kigoda said during the familiarisation meeting that the importance of the industrial sector in speeding up economic growth with tangible impact on poverty eradication was obvious.

He said industrialisation could be an instrument for job creation, full utilisation of the country’s natural resources, agriculture and value addition to farm produce in order to fetch premium prices in both domestic and foreign markets.

Dr Kigoda used the occasion to announce his priorities at the ministry, to which he was no stranger, saying he was determined to revive privatised industries which have been idle for years.  Dr Kigoda was Minister for industries before in 1997.

He said their initial task will be to revamp the agro based industries to benefit farmers, create more employment and enhance contribution to economic growth. “We want to conduct diagnostic approach to give life back to defunct factories so that they become operational in a short period of time,” he said.

He cited the textile and Cashewnut industries, which had either stopped production altogether or operating at very low capacity. That would entail establishing factors behind the failure of privatised industries in a bid to come up with a lasting solution that would enable them to once again contribute to the economy. 

It is a matter of fact that there were enormous challenges related to poor infrastructure, erratic power supply and inflation, which the government is relentlessly addressing. The revival plan would involve the application of strategic plans used in other successful privatised firms like Tanzania Breweries Limited (TBL) and Tanzania Cigarette Company (TCC). 

“These are some of the success stories of privatisation policy which is being criticised,” he noted. The government will consider the tax regime to ensure that it was not burdensome to local and foreign investors. “It is an important step in reducing the cost of doing business in the country,” he said.

The minister underscored the significance of Small Medium Enterprises (SMEs) in order to yield multiple impacts onto the economy. The focus will be put on empowering SMEs, the crucial instruments in fighting poverty.  Training and funding will be among other strategies to empower SMEs.

For smooth implementation, the government will continue negotiating with lending facilities to ensure they provide affordable loans. The Industry, Trade and Marketing Permanent Secretary Ms Joyce Mapunjo said recently that the master plan which foresees improvement in co-ordination of all stakeholders involved directly in the industrial sector was in place.

For example, other sectors for supporting industrialisation included railways, agriculture and mining while technology, research, innovation and education were catalytic inputs to attain higher levels of development.

The Director for Industry Development Ms Eline Sikazwe said one of the government’s roles was to formulate policies, strategies and conducive environment for investment but the private sector remains the main actor in building competitive and sustainable industrial sector. 

Equally, she said development partners and other non-state actors’ contribution was important in the realisation of the Sustainable Industrial Development Policy (SIDP) objectives. “We need participatory approach with all stakeholders especially from the private sector in implementing the strategic policies,” she added.

The Advisor for Industrial Development Mr Yoshiyasu Mizuno said the Integrated Industrial Development Strategy (IIDS) 2025 targets to accelerate the sector’s growth to 13 per cent by 2015 and up to 15 per cent thereafter. Also he said to increase manufacturing value addition from 1.8 billion US dollars (about 2.8bn/-) to 16.8 US dollars (about 26.8bn/-) in 2025 and to increase the sector’s contribution to Gross Domestic Product (GDP) from the current nine per cent to 23 per cent by 2025.

“Learning from the success of Asian countries, IIDS aims to further accelerate the growth by establishing the country’s own development process focusing on the geographical advantages like long coastal line and logistics corridors to landlocked countries and the abundant natural resources,” he said. 

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Author: SEBASTIAN MRINDOKO

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