DODOMA: AN Indonesia-based company has expressed interest in establishing a large fertiliser factory in Tanzania, a move that could ease the country’s financial burden of importing fertiliser.
This announcement was made in the National Assembly yesterday by the Minister of State in the President’s Office for Planning and Investment, Professor Kitila Mkumbo, during his debate on the 2024 implementation report of the Parliamentary Investment Committee (PIC), which was presented earlier in the morning.
Prof Mkumbo revealed that the government was currently spending over 1tri/- annually to import fertiliser.
In light of this, he noted that the government is taking several steps to ensure local production of fertiliser, with plans for surplus production to be exported.
While he did not provide specific details or the name of the company, Prof Mkumbo confirmed that the government had finalised negotiations with the Indonesian company, which has agreed to set up a modern fertiliser factory in southern Tanzania.
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“This factory will produce fertiliser using gas and once completed, Tanzania will no longer need to import fertiliser,” he said, insisting that the government’s goal is to attract more investors to the sector to not only meet local demand but also increase exports.
Earlier, while presenting the PIC report, the committee Chairperson, Augustine Vuma Holle, advised the government to revive fertiliser production through the Tanzania Fertiliser Company (TFC), which has remained inactive for years.
“Currently, we are spending large amount of foreign currency to import urea fertiliser. If TFC were operational, we would only need between 1 to 1.5 million US dollars to meet the country’s demand and even export surplus fertiliser,” Holle explained.
He pointed out that over a three-year period, from 2020 to 2023, Tanzania spent 1.007tri/- on imported fertiliser.
This money, he argued, could have been kept within the country if the government revived the TFC. In another development, the House expressed concern over the declining investment performance of the Public Service Social Security Fund (PSSSF).
According to the Chairperson of the Parliamentary Budget Committee, Oran Njeza, between 2021 and 2023, PSSSF disbursed pensions amounting to 4.34tri/-, while receiving returns of only 1.8tri/-.
The figures show that more money was paid out than the interest accrued from the total investment fund.
“The internationally acceptable sustainability rate for a pension fund is 60 per cent, with the lowest acceptable rate being 40 per cent.
However, PSSSF’s sustainability currently stands at only 36.4 per cent,” Njeza stated. The committee said that supervision of the PSSSF should be managed by the Bank of Tanzania (BoT) and the Prime Minister’s Office, Ministry of Labour, Employment, Youths and the Disabled.
The House unanimously agreed that the pension fund’s investments must be better managed to ensure that returns are proportional to the monthly contributions being made.
