Dar es Salaam. President John Magufuli has pointed out a number of key issues that are derailing efforts to improve the business environment in Tanzania, and vowed to address the challenges.
The Head of State slammed both state-owned institutions and the business community for creating an unfavorable business climate.
He said the existence of excessively complicated administrative procedures in government was one of the factors that discourage the sustainable growth of business activities.
Magufuli made the remarks while addressing businessmen and women from all districts and regions across the country during a meeting held at the State House on Friday, June 7, 2019.
“The current bureaucracy in the government makes it difficult for the business environment to improve in the country,” said the Head of State.
He further mentioned that the tax burden was another challenge particularly in the tourism sector and the President's Office, Regional Administration and Local Government.
He condemned the tendency of some local government authorities to introduce new taxes without prior consultations with the central government.
President Magufuli admitted that despite the government’s efforts to end corruption, there are still some government officials embracing it.
“I am aware there are some government officials at Tanzania Revenue Authority (TRA) and Tanzania Ports Authority (TPA) and other authorities who demand and receive bribes from traders,” the President said.
Meanwhile, the Head of State admitted that the government has for many years failed to put in place a proper mechanism to empower small-scale entrepreneurs, but he reassured them of his government’s commitment to empower the SMEs.
“The SMEs contribute revenue to the GDP. A failure to empower them does not only affect them but also denies the government sufficient revenues,” said Dr Magufuli.
Dr Magufuli further criticized the financial institutions for their failure to issue soft loans to low-profile business people in the country.
“Most of the loans are issued to big companies based in towns yet, there are business people in rural areas who also need capital,” he said.
He, therefore, instructed the relevant authorities to effectively address the challenge and make sure the loans also benefit the small-scale entrepreneurs in the country.
Further referring to the current business climate in Tanzania, Dr Magufuli accused some business people of tax evasion and corruption.
Magufuli also took on the Tanzania Private Sector Foundation (TPSF) for its failure to empower the private sector traders in the country.
“TPSF benefits only a group of individual traders in the country, but not all,” he said.
Dr Magufuli reiterated his government’s commitment to improving the business environment in the country, but he appealed for transparency and accountability.