Dar es Salaam. CUF chairman Ibrahim Lipumba yesterday said agriculture should be the foundation of the country’s industrialisation drive.
Prof Lipumba, who is also a renowned economist, suggested increase supply of money, implementation of strategic projects after comprehensive feasibility studies, speedy servicing of suppliers debts and improvement of business and investment climate in order to increase money in circulation.
Prof Lipumba made the statement yesterday at Mwananchi Communications Limited (MCL) when speaking to journalists when he courtesy at the company headquarters.
He said agriculture should be the foundation of industrialization because it facilitated establishment of agro-processing, textile and leather factories just to mention a few.
“But, the country has been allocating below 3 percent in agriculture contrary to 10 percent agreed by the Southern African Development Community (Sadc) member states,” he said.
Budgets of the ministry of Agriculture shows that Tanzania allocated 0.93 percent and 0.76 percent in 2016/17 and 2017/18 fiscal years respectively.
The budget shows that 0.499 percent and 0.62 per cent was apportioned in 2018/19 and 2019/20 financial years respectively.
According to him, comprehensive feasibility studies was required before implementing the construction of the Mwalimu Nyerere Dam project and purchase of aircrafts for revival of Air Tanzania Company Limited (ATCL).
He said planes wasn’t a problem limiting tourists from visiting the country, rather he pointed out the poor developed infrastructures in the tourist’s attractions.
“We are therefore forced to use the small amount in the country’s budget despite an increase in tax revenue collections. This is after deducting 40 percent to service interest of loans secured by the government,” he said.
He said the 2015 Bank of Tanzania (BOT) report shows that money supply in the economy increased by 15 percent to 25 percent during former President Jakaya Kikwete’s administration.
“But, the amount has significantly gone down in the last four years. Statistics show that only, 4.9 percent was supplied in 2018 which is very low,” he said.
He said money supply was supposed to range between 15 to 18 percent whenever economy grew at 7 percent and 5 percent inflation rate.
He said, debts owed by suppliers and service providers should be paid on time to increase money circulation.
CTI members reported outstanding claims of VAT refunds amounting to more than Sh45 billion and the same amount for refundable import duty by May 2019.
The Professor who doubles as CUF national chairman said business and investment climate should be improved to attract more Foreign Domestic Investment (FDI).
According to him, Rwanda was ranking 27th in the World Banks (WB) Easy of Doing business report as Tanzania stood was ranked 141st.
Report also show that Tanzania was ranked 131 in 2015; 139 in 2016; 132 in 2017, 137 in 2018 and 141st position in 2019.
The country also has endorsed a blueprint for regulatory reforms to improve business environment in the country.