Dar es Salaam: The Tanzania Investment Centre (TIC) registered 600 projects worth $2.8 billion (about Sh4 trillion) in 2010. The projects created 70,000 jobs. That happened because the country improved its business environment and the world economy started expanding after the economic crisis. The centre plans to create even more investments in 2011. In 2009, TIC registered 579 projects worth $2.461 billion, creating 56,998 jobs.
'We have surpassed our target of registering 500 projects in 2010,' TIC executive director Emmanuel Ole Naiko, told BusinessWeek.
A reinstatement of tax breaks in importation of some capital goods has buoyed investors’ confidence. The government scrapped tax relief granted to goods classified for specific investments in June 2009. The duty breaks were reinstated in June 2010.
The government has also been tackling obstacles highlighted by the World Bank’s Doing Business Report and World Economic Forum’s Global Competitiveness Report. Having performed dismally in the World Bank’s Doing Business Reports, the government initiated a task force, comprising permanent secretaries of ministries that deal with business and investments.
The team, under the chairmanship of the permanent secretary in the Prime Minister’s Office, Mr Peniel Lyimo, compiled its report titled ‘Roadmap for improvement of Tanzania’s business environment’ late last year to guide the government on ways of addressing the country’s poor rankings in ‘doing business’ reports.
'We project to register at least 750 projects worth $3 billion in 2011 and create at least 85,000 jobs,' said Mr Ole Naiko.
Some companies which suspended their investment projects during the past two years due to the global financial and economic crisis may be considering returning to invest in Tanzania.
The mining sector lost investments over $3.6 billion during the past two years when US-based Century Aluminum postponed plans to build a $3.5 billion smelter, and Switzerland-based miner Xstrata Plc halted plans for a $165 million nickel mining and extraction plant.
Sources say the government is still discussing with the companies to get them back into the country. 'They still hold the licences and I’m sure they will invest, now that the storm looks over,' said a source.
Western media reported earlier this month that Xstrata was on track to spend $23 billion globally up until 2016 for expansion, with a focus on coal, copper and nickel projects.
Areas being given more priority include the company’s nickel pipeline, including Koniambo in New Caledonia, Kabanga in Tanzania and the 50 per cent capacity restart of the Falcondo operation in the Dominican Republic.
Tanzania’s gold production is also likely to rise substantially from the 50 tonnes in 2009 to 63 tonnes in 2015, according to the Texas-based consulting firm, Frost & Sullivan, Inc.
In its report, released October 2010, the firm based its assumption on Tanzania’s highly prospective geology, rising gold prices and increasing foreign direct investment.
Tourism attracted the highest number of investment projects in 2007 and 2008. In 2009, the sector was outshone by manufacturing.
TIC anticipates that commercial agriculture will also attract more investments because the government is carrying out the Kilimo Kwanza (Agriculture First) initiative. The government’s preferred investment areas include agriculture and agro-industries, extractive industries, infrastructure development and tourism.
