OPINION: Tribute: Mengi’s contribution to Tanzania’s economy
The death of Reginald Mengi has been among the leading news in Tanzania for the first week of May, 2019.
Among others, he was the executive chairman of the IPP Group of Companies and held several leadership positions in Tanzania private sector. He is among the ‘founding fathers’ of the private sector in Tanzania as we know it today. He was also among leading philanthropists in the country.
This piece highlights some of his many and far reaching contributions in Tanzania’s economy.
Tanzania’s private sector is still in its relative infancy stage of development. This is partly due to the socialist past of the country.
Between 1967 and mid-1980s, Tanzania practiced state controlled economy. Following the reforms of the mid-1980s, private sector as we know it today saw the light of the day.
Mr Mengi is among the first and very active private sector players in Tanzania. He has been among the moving and shaking titans and captains of the sector from the first days of the private sector. This is partly seen in his daring investments in various sectors.
He did this in his conglomerate under the umbrella of IPP Group of Companies.
The highly diversified companies under this conglomerate include diversified media houses, soft drinks, mining and much more.
Mr Mengi stood out of the crowd in the private sector space as a great son of Tanzania in the sector from its very early days.
He has also contributed in the private sector development not only as active player as investor and businessman but also as a leader of various private sector organisations.
He held chairmanship and board membership positions in a number of private sector umbrella organisations.
These include the Confederation of Tanzanian Industry (CTI), Tanzania Private Sector Foundation (TPSF) and East African Business Council (EABC). All these are but some of ways in which Mr Mengi contributed in Tanzania’s private sector.
Entrepreneurship development
Entrepreneurship is very important in establishing enterprises, jobs and associated incomes creation, economic growth, foreign exchange generation and saving and much more.
Mr Mengi has played immense role in the development of entrepreneurship in Tanzania.
Entrepreneurship is all about spotting and making most out of opportunities, it is about taking calculated risk in an area of business uncertainty, it is about daring, being innovate and creative, establishing and nurturing enterprises and new ventures, taking responsibilities for businesses and ventures he starts etc.
There is no single doubt that Mr Mengi had all these and many other entrepreneurial traits and qualities.
Not only did he have these traits, but also he supported young and emerging entrepreneurs in different ways including business ideas completions followed by monetary and non monetary support to winners.
He played key inspirational and motivational roles in entrepreneurship development in country whose past was anti-entrepreneurial in nature.
Employment
Mr Mengi’s investments have contributed in creating direct and indirect employment.
Employment is among the major macroeconomic fundamentals of concern in any country. Employment forms among major development strategies, policies and other interventions.
In Tanzania’s employment is among the major goals in the Tanzania Development Vision 2025, the Second Five Years Development Plan, political parties’ election manifestos, annual and other development plans.
Employment brings with it incomes and by extension purchasing power.
This stimulates aggregate demand and related production. Mr Mengi’s investments and investments related to his investments as suppliers, contractors and sub-contractors in the context of input-output relations have contributed to employment creation an d development.
This is also true for investments that saw the light of the day from his support for entrepreneurship development
Government revenues
Government revenue is essential for funding public goods and services such as health, education, water, security and infrastructure including roads, ports, airports and railways among others.
Mr Mengi’s investments have contributed to government coffers in many ways. These include through tax and non tax revenues.
Taxes are of various kinds including but not limited to Value Added Tax (VAT), Corporate Income Tax (CIT), Pay As You Earn (Paye), Skills Development Levy (SDL) and many others.
These are mainly revenues to the central government. Other government revenues include various fees, fines and duties.
Mr Mengi’s investments should be contributing to these revenues in various ways.
They should also be contributing in foreign currency earnings through exports and foreign currency savings through domestic production of what would have been imported in the context of import substitution.
The author is professor of economics, a researcher, consultant and the principal of Mzumbe University Dar es Salaam Business School.
