Treasury: Chadema wrong on govt sale of TBL, TCC shares
Treasury Registrar Lawrence Mafuru addresses journalists on the sale of TCC and TBL shares in Dar es Salaam yesterday. PHOTO |said ng’amilo
What you need to know:
Instead, the shares were sold to raise funds for re-investment and funding of various economic activities, according to Treasury Registrar Lawrence Mafuru.
Dar es Salaam. The Treasury yesterday took a swipe at Chadema leaders for claiming that the government’s decision to sell its shares in the Tanzania Breweries Limited (TBL) and Tanzania Cigarette Company (TCC) was aimed at raising funds for CCM campaigns.
Instead, the shares were sold to raise funds for re-investment and funding of various economic activities, according to Treasury Registrar Lawrence Mafuru.
Mr Mafuru told a news conference here yesterday: “As a matter of principle when it comes to investment in company shares, the government is not bound to remain a shareholder in any company forever and there is no economic theory that states that remaining a shareholder is always the smartest thing to do notwithstanding the market conditions.’’
He added that when a company is listed on a stock market, there are times when it is prudent and profitable to sell shares when the price is high and has probably reached its peak and that it is sometimes a good idea to hold onto shares when prices are too low or rising but have not reached peak value.
The sale of shares, particularly those of TBL, has drawn the attention of the opposition whose leaders recently claimed at a campaign rally that the divestiture was aiming at raising money for the CCM presidential campaign.
“If the information that the government has fraudulently sold its shares from TBL and TCC comes from Chadema for whatever reasons then it leaves a lot to be desired about their political maturity and their knowledge on the way capital markets work,’’ insisted Mr Mafuru.
He added that the government had been holding the shares on behalf of Tanzanians and that it was the right thing for the government to release the shares to the market when conditions are right.
“The country cannot continue to accumulate public debt through borrowing while sitting on liquid financial assets that can be easily and cheaply accessed to deliver public goods,’’ he added.
The government was holding a four percent stake in TBL and 2.5 per cent ownership in TCC. According to Mr Mafuru the selling of shares in TBL and TCC would raise Sh212 billion and that the money was approved by Parliament during its budget sitting in June this year.
