Kurasini project set to commerce afresh

Dar es Salaam. The government is starting afresh on its planned Kurasini trade and logistics centre project after stalling for eight years, The Citizen can report.

The project is the brainchild of the Sino-Africa Cooperation meeting held in Cairo in 2009, and was earlier planned to be a trade hub and a distribution point of Chinese gsoods to East and Central African markets.

However, the would-be Sino-Tanzania Logistics Centre was fine-tuned recently to conform to Tanzania’s priorities.

The focus is now to make it a hub for adding value to Tanzania’s strategic agricultural products before they are exported.

Three weeks ago, Industry and Trade Minister Kitila Mkumbo told The Citizen that the government was expected to award a tender for a feasibility study a fortnight ago that would state clearly how the projects should be run.

Again, he said, this month the government will announce an international tender calling for investors who are willing and able to run the project in partnership with the government.

“It is our intention that by the end of October we shall get a serious investor who will partner with the government to invest at the Kurasini project,” Prof Mkumbo said by telephone.

“We have a number of investors who have shown interest, but for us to be fair, we have decided to announce internationally so that we can get a serious tender process.”

This new development symbolises that the government is starting afresh because until 2016 the project reached a stage where China was ready for execution.

It was just waiting for the government to compensate those who were to be evacuated to pave a way for the execution of the project.

Initially, under the arrangement, Tanzania was required to find space and compensate those to be affected while the government of China was to finance the entire project to the tune of $400 million (about Sh870 billion at the prevailing exchange rate).

But, noting that the Kurasini project is near the port makes it potential, Minister Mkumbo told said numerous investors are showing interest to invest.

On the targeted investors, he said, given the fact that the investment would be huge, they were expecting to get a serious foreign investor.

However, he expounded, the actual running of the business would be done by the Tanzanians.

“There will be local content. Just like Mlimani City where a very big international investor has invested there, but majority of businesses are owned by Tanzanians,” noted Prof Mkumbo.

So far, the government has since 2013 paid over Sh100 billion to residents as compensation to give way to the project.

The business hub, which was expected to serve both East and Central African countries, was expected to generate about 30,000 direct and indirect jobs.

But, perhaps the modality of implementation could change depending on what the new feasibility study will suggest.

In a nutshell: Prof Mkumbo said the international trade hub would unlock immense market potentials for agriculture products.

“We are targeting to set up an agro-processing facility so that produce from various regions will be processed there before being exported,” he noted.

This, he said, is very important because currently most of the country’s exports are in raw form, thus denying Tanzania from earning foreign exchange.

The minister added that large-scale industries would be constructed there and products be sold ready for exports.

The electronic facility equipment assembly plant would also be set up, according to the minister.

“At least, initially those are the ideas that we have, but the feasibility study will give much of the details of what is going to happen there,” Prof Mkumbo said.

Asked on the reason for delay in execution of the project, he said: “I was not there (in the government), but perhaps the reason could be lack of clarity on our part as government on how we want to run it.”

However, this comes at the right time in the context of global trade.

Business expert and economist Donath Olomi said trade and logistic centres were pivotal to the development of the country’s economy as it sets a stage for the mushrooming of trade and employment.

“We need not one, but several trade and logistic centres to boost the growth of the economy,” he said.

Having inefficient or inadequate systems of transportation, logistics, and trade-related infrastructure can severely impede a country’s ability to compete on a global scale.

Making it easier for firms and people to access opportunities, markets, and supply-chains is fundamental in trade.

The Tanzania Business Community director of communication, Mr Stephen Chamle, said the government’s intention to come up with the Kurasini project was good, but should be treated with care.

Citing the example of vehicle and motorcycle assembling, he expounded that the Kurasini projects should focus only on activities that were not carried out at existing markets like Kariakoo.

“Otherwise, the existing markets will die a natural death,” cautioned Mr Chamle.