CROSS ROADS : Why TZ must push for agro-based industries

What you need to know:

  • This is despite the average of 7 per cent growth annually making Tanzania “one of the fastest growing economies in sub-Saharan Africa.”

Increasing investments in the agricultural value chain could be the most viable way to create wealth for the majority of Tanzanians. Time and again, experts have warned that the impressive economic growth registered in the last two decades or so has not been inclusive.

This is despite the average of 7 per cent growth annually making Tanzania “one of the fastest growing economies in sub-Saharan Africa.”

The government seems to be concerned about inclusive growth and no wonder on May 4, 2016, the Bank of Tanzania (BoT) hosted Prof Stefan Dercon (chief economist, DFID), to give a presentation titled “Inclusive Growth in Tanzania: Lessons from Elsewhere.”

The don hailed the country’s gains in reducing poverty but noted the “difficulty of designing industrial policies successfully and the importance of cultivating an effective state that fosters economic growth and structural transformation.”

In other words, the failure of industrial policies could be one factor that has made inclusive growth elusive. Methinks that agriculture-based industries would create many jobs along the whole value chain, and make all the difference.

That is why I was impressed when President John Magufuli inaugurated a $120 million (Sh250 billion) fruit processing factory on the outskirts of Dar es Salaam, which is owned by a local business mogul.

Reports indicate that the new plant has the capacity to process 350 tonnes of fruits and vegetables daily. If the plant will be utilised well, it means hundreds of farmers will have a market for their produce.

According to a report released early last week by the National Bureau of Statistics (NBS), titled Census of Industrial Products (CIP) 2013, Tanzania had 47,921 small scale industries and 1,322 large scale ones. By 2014, industries surged to 50,656. Despite the impressive growth, the number of locally manufactured goods that we purchase in the country remains low.

In most parts of the country, both urban and rural areas, shops predominantly sell imported goods. We have local brands like Azam, Mohamed Enterprises that sell soft drinks, but it is a shame we also have lots of imported confectioneries (biscuits, sweets,).

At the launch of CIP, Industry, Trade and Investments minister Charles Mwijage made it clear that cheap and substandard imports were hurting local industries. He warned tough action against such imports.

While every successive government has promised more industries so as to create adequate jobs for Tanzanians, we have got nothing much to talk home about. Mwalimu Julius Nyerere tried a lot, and we had huge factories dotting the country, but most run bankrupt because of incompetence and misappropriations.

We need a very bold industrial policy that will encourage development of manufacturing plants all over the country, especially for agriculture-based products. The huge gas, mining, infrastructure project, although have great impact on national economy, they may not lead to inclusive growth. But as a matter of urgency, projects that empower farmers (who are the majority), and to create jobs for our increasing population, huge agro-based industries are a must.

Through industries, so long as they provide assured markets for farmers, this country will change for good. The minister of Lands, Water, Energy and Environment in Zanzibar, Ms Salama Talib, has assured that the Isles is looking for solutions to address challenges hampering development of local industries.

She spoke of creating an enabling environment for businesses to flourish. To get this right, we need an industrial policy that works. We must take into account the failures of the past industrialisation drive.

I am very convinced that in agriculture-based industries we have a competitive edge over many other African nations. We have the land and manpower. The choice to have the natured mired in peasantry agriculture rather than venture into commercial agriculture/processing is in our hands.

Saumu Jumanne is an assistant lecturer, Dar es Salaam University College of Education (DUCE)