Strengthening the business environment in Tanzania
A conducive business environment is a prerequisite for economic growth and poverty reduction. Creating and maintaining a business climate that stimulates inclusive and sustainable private sector development must be at the core of any effort to spur the growth of sustainable, vibrant and competitive socio-economic sectors.
Highlighting the importance of foreign investments, the Dutch investors alone contributes approx. EUR 28 million annually to the Tanzania economy. Statistically, Tanzania Investment Center (TIC) cite 170 registered projects valued at $41.63 billion from the Netherlands, projected to create 15,329 jobs in Tanzania.
To date several large Dutch corporates are operating in Tanzania, like Philips, Heineken, Asilia Lodges, KLM, Rijk Zwaan, East West Seeds and Enza Zaden as well as many other locally established horticultural, tourism and hospitality companies. Most Dutch companies have made substantial and long-term investments in Tanzania. These investments have played a significant role in accelerating Tanzania’s progress towards sustainable development as an engine of economic growth and employment.
Dutch-Tanzania Business Dialogue
In a wake of this, the Embassy organized a Dutch-Tanzania business dialogue in Arusha on 9 June 2022, bringing together public actors and Dutch businesses to find a win-win solution on addressing private sector bottlenecks.
The dialogue is part of series of strategic dialogues with Tanzania authorities to unlock sectoral challenges, building from the two previous business dialogues on tourism and agriculture held in 2021.
The Director of Investment from the Ministry of Industry and Trade, Mr. Aristides Mbwasi was the guest speaker, along with representatives from public institutes, namely; Tanzania Investment Center (TIC), Tanzania Revenue Authority (TRA), the National Environment Management Council (NEMC) and Export Processing Zone Authority (EPZA) had the privilege to engage with the business to deliberate on practical solutions.
Challenges on doing business in Tanzania
Doing business in Tanzania is challenging yet rewarding, the current Tanzania pro-business approach focuses on regaining investors trust in the country and bring back investors who shifted their businesses to other countries due to a less conducive business environment in the past years.
The wheel of change seems to be moving now, while there are still more rooms for improving the business climate. Some of key challenges addressed by the companies to mention a few;
- lengthy process of securing the environmental impact assessment (EIA),
- delays in Value Added Tax (VAT) refunds,
- access to finance for startup agribusinesses,
- lengthy and cumbersome process of acquiring land land titling.
Businesses also recommended a single permit for investor with multiple investments and consider setting up land banks for agricultural investments at proximity area with required infrastructures e.g., Roads, power, drainage systems.
Commitment from the Government of Tanzania
Closing the event, Mr. Aristides Mbwasi promised to continue working on issues raised and highlighted commitment from the Government of Tanzania to improving the business environment and investment climate by taking regulatory, legal and institutional reforms to ease the cost of doing business and to increase efficiency and productivity of the private sector.
Some of reforms mentioned includes harmonization of activities of regulators such as between Food and Drug Authority (TFDA) and the Tanzania Bureau of Standards (TBS) which gave birth to Tanzania Medicine and Medical Devices Authority (TMDA) , establishing Tanzania Electronic Investment Window (TeIW) to be used to provide integrated services to investors and transparency. TeIW will bring under one window several government regulatory bodies.
The Embassy is looking back on a successful event and looking forward to the future. We are eager to continue to provide a platform for public institutions and the private sector to meet and make changes to improve the Tanzania business climate, which will bring positive impact the Tanzanian economy.
More information
For more information about the article contact the Embassy via dar-ea@minbuza.nl and dar-lnv@minbuza.nl .
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