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Global recovery revs up domestic manufacturing
The value of goods manufactured in Tanzania rose by 8.6 percent to Sh13.74 trillion by the year ended June 30, according to the central bank. Photo Credit | Getty Images |iStockphoto
What you need to know:
- The value of goods manufactured in Tanzania rose to Sh13.74 trillion by the year ended June 30, 2023 from Sh12.65 trillion during the preceding year, driven by the global recovery from the Covid-19 pandemic
Dar es Salaam. The value of goods manufactured in Tanzania rose by 8.6 percent to Sh13.74 trillion by the year ended June 30, 2023, up from Sh12.65 trillion during the preceding year.
Beverages, wheat flour, cigarettes, mattresses, cement and ceramics played a key role in the growth, the Bank of Tanzania (BoT) says in its Consolidated Zonal Economic Report for June 2023.
It attributes the rise to, among other factors, improved availability of imported raw materials following the recovery of source markets from the devastating effects of the global Covid-19 pandemic.
“The improved industrial production was also attributed to conducive investment environment and increase in capacity utilisation by some manufacturing firms, including ceramic factories in Coast Region,” says the report.
Increased demand in the domestic market and other countries in the region, including Burundi, Rwanda, DR Congo, the Comoros, Malawi and Mozambique, was another factor.
Globally, manufacturing is expected to grow annually until at least 2025 despite geopolitical tensions and disruption of supply chains.
This is according to international auditing firm KPMG in its Global Manufacturing Prospects 2023 report.
Companies across the world are also grappling with fast-advancing technology and striving to meet targets on reducing carbon footprints.
A lecturer at the University of Dar es Salaam’s School of Economics, Dr Wilhelm Ngasamiaku, said improved industrial production had been influenced by increased economic activities such as construction and rise in exports and international trade in general.
“We can also see that the implementation of the government’s Blueprint for Regulatory Reforms has paid off as several non-tariff barriers were removed, thus boosting Tanzania’s share of international trade,” he said.
Dr Ngasamiaku added that the government should sustain the upward trend by further improving policies as well as the business environment and tax collection.
“This will increase the sector’s contribution to GDP and the economy as a whole,” he said.
Dr Daudi Ndaki of Mzumbe University said the country had been able to increase the number of manufacturers through infrastructure and human capital development and public-private partnerships.
“To ensure the sustainability of these industries, the government must continue to develop the infrastructure needed to transport products and provide reliable power supply, machinery and financing,” he said.
Dr Ndaki added that continued investment in education had provided the country with human capital with the requisite skills and expertise to operate enterprises across the board
