Item |
2004 |
2005 |
2006 |
October2006 |
October2007 |
Year ending October2006 |
Year ending October2007 |
% annual change |
Service Exports |
944.1 |
1072.7 |
1,446.4
|
128.8 |
137.1 |
1,454.70 |
1,685.70 |
(15.9% increase) |
Service Imports |
972.1 |
1162.9 |
1,282.1
|
96.2 |
132.9 |
1,241.40 |
1,449.70 |
(16.8% increase) |
Service trade balance |
-28.0 |
-90.2 |
+164.3
|
+32.6 |
+4.2 |
+213.3 |
+236.1 |
(10.7% increase) |
Major categories of service Trade
Exports
12. Tourism: For the one-year period ending October 2007, Tanzania’s service receipts in the tourism sector amounted to $979.8 million compared with $898.0 million in the year ending October 2006.
13. Transportation: During the year ending October 2007, transportation receipts increased to a total of US$375.9 million compared with US$ 335.9 million in the previous year.
Imports
14. Travel (tourism): On a year-to-year basis, service payments increased by 16.8% to US$ 1,449.70 million in the year ending October 2007. For the year ending October 2007, Tanzania’s service payments on travel were $979.8 million, marginally higher than the $898.0 million recorded during the year ending October 2006.
15. Freight and Transportation: For the year ending October 2007, Tanzania’s service payments on freight and transportation increased to $375.9 million due to the increase in merchandise imports, from the $335.9 million recorded during the year ending October 2006.
16. Financial and other services: For the year ending October 2007, Tanzania’s service payments towards other services including communication, construction, insurance, financial, royalties, and miscellaneous business services were $330.2 million, higher than the $220.8 million recorded during the year ending October 2006.
Major investments in Tanzania
17. According to the Tanzania investment Centre, the cumulative foreign investment in the country during the period 1990 to 2005 was US$10.2 billion involving 3531 projects. Major areas of investment were: tourism, natural resources, energy, manufacturing, telecom, banking and insurance, transportation and infrastructure.
18. Tanzania is a seeker of foreign investment and is not a major investor abroad.
Developments in foreign investment during the month of December 2007
19. Artumas to develop Gas Turbine power project in Mtwara: Canadian firm Artumas Group Inc. was reportedly proposing to develop the Mtwara Open Cycle Gas Turbine project plus transmission linkage between Mtwara and Dar es Salaam. The project involved transmitting electricity generated using natural gas at plant located in Mtwara, approximately 500 km North to a location 30 km outside Dar es Salaam. Power would be transmitted by 300 kV double circuit transmission lines mounted on steel towers. Artumas had initiated an Environmental Impact Assessment of the project.
20. African Development Bank approved initial funding of EASSy project: The African Development Bank (AfDB) along with other participating development financial institutions signed loan agreements for the East African Submarine Cable System (EASSy) project involving construction of a submarine fibre-optic cable along the east coast of Africa that will run for 10,000 kilometres from the continent’s southern tip to the Horn of Africa, connecting South Africa, Mozambique, Madagascar, Tanzania, Kenya, Somalia, Djibouti, and Sudan. The AfDB, the French development Agency, the European Investment Bank, Germany’s Development Bank (KfW) and the International Finance Corporation will provide the project’s entire long-term loan financing of $70.7 million, with $14.5 million coming from the AfDB. AfDB’s financing would be channelled through the EASSy special purpose vehicle (SPV) also known as the West Indian Ocean Cable Company (WIOCC) in the form of a $14.5 million loan. The total project cost is $235 million.
21. Swedish company to start biofuel project: Swedish Ethanol Chemistry AB (Sekab), registered as Sekab BioEnergy Tanzania Ltd. reportedly acquired 120000 hectares of land in Tanzania (20,000 hectares in Bagamoyo district and another 100,000 hectares in Rufiji district) for setting up sugarcane based bioethanol and biofuel plant. Sekab was also planning to acquire the former Scania assembly plant in Kibaha for assembly of vehicles based on ethanol biofuel.
22. Japan to provide Tsh 214million to Tanesco power project: THE government of Japan would provide a Tsh 214 million grant for reinforcement of transmission and distribution facilities at the Tanzania Electric Supply Company Ltd (Tanesco) to stabilise power supply in Dar es Salaam. The money would be used to build a new power sub-station at Oysterbay in the city, meant to reduce the burden of over-load at Ilala sub- station thus helping to stabilise power supply.
23. Canaco Acquires a 200 Sq Km Handeni Gold Property in Tanzania: Canadian company, Canaco Resources Inc. announced conclusion of re-negotiation of the Company's option agreement with Midlands Minerals Corporation on the New Kilindi prospect, located in the Handeni District in the Tanga Region of Tanzania. Through an arrangement with Midlands, Canaco reconfigured its landholdings in the Handeni area and has acquired a 100% interest in a 200 sq km prospecting license that will now form part of the Handeni Project, the core of Canaco's exploration program in the region.
24. Madison secured $7 Million From IFC to fund projects in Tanzania and Burundi: Madison Financial Services Company Ltd of Zambia secured $7 million from the International Finance Corporation (IFC) to invest in financial markets in Tanzania and Burundi. The company was planning to expend its operation into Tanzania in private financial and insurance sector.
25. Tanzania’s livestock potential: According to Deputy Minister for Livestock Development Dr. Charles Mlingwa the abundance of livestock in Tanzania was an unexploited giant `gold mine`. Recent figures showed that Tanzania had some 18.8 million heads of cattle, 13.5 million goats, 3.6 million sheep, 53 million chickens and 1.37 million pigs, providing livelihood to over 8 million people. However, the livestock sector`s contribution to Tanzania’s Gross Domestic Product (GDP) was merely four percent..
India’s investment interests
26. Potential exists for Indian investment/participation in projects relating to development of IT and telecom systems, power generation - gas, hydel as well as coal based, power transmission, construction-roads, bridges, hospitals and infrastructure development, mining, agro processing, gem cutting and polishing, educational services, railways.
Major Trading agreements proposed/ finalised
27. US Government to raise aid to Tanzania by 30%: The overall US Government aid to Tanzania during the current fiscal year (1 October 2007 to 30 September 2008) was estimated to be $648 million – including direct official development assistance ($392 million) and multilateral assistance. The US aid commitment for the next year was nearly 30 per cent more than about $500 million assistance provided during the previous fiscal year ended last September 2007. Part of the current aid will be provided under the Millennium Challenge Corporation (MCC) Compact which is expected to be signed next month. The MCC's $697 million, which covers five years, seeks to strengthen the country's roads, energy and clean water.
According to US Department of Commerce figures, American FDI to Tanzania averaged $20.8 million between 2001 and 2005. It was $21 million and $22 million in 2001 and 2002 before falling to $18 million in 2003 and then surged to $22 million and $21 million in 2004 and 2005 respectively. The total value of FDI in Tanzania in 2006 was $473 million up from $325 million in 2005.
The US government’s largest assistance to Tanzania was the PEPFAR, since inception of which in 2003, over $500 million support had been provided towards combating HIV/Aids. This fiscal year, the United States Government was expected to increase PEPFAR assistance by an additional $303 million.
28. Mixed reaction over the interim EPA between EAC and EU: Tanzanian trade experts received with mixed feelings the Economic Partnership Agreement (EPA) trade deal signed between the East African Community and the European Union in Kampala in end-November 2007. Many experts expressed fears that the East African member states would lose under the arrangement., since EU Common Agricultural Policy required each country to import goods of a certain standard which Tanzania could not meet. On the other hand, the Minister for Trade, Industry and Marketing, Basil Mramba, said Tanzanians assured the public that the Economic Partnership Agreement (EPA) would benefit Tanzania.
29. The World Bank to provide U.S. $111 million to upgrade, Tanzania power system: The World Bank Board of Executive Directors approved a US$105 million equivalent IDA credit and a US$6.5 million Global Environment Facility (GEF) grant to improve electricity services in Tanzania, where electrification rates in some areas are as low as two percent.
30. Donors to provide US $ 4.7 million for Pangani River Basin Management Project PRBMP: Donors including the European Commission, Water and Nature Initiative and UNDP/Global Environmental Facility and the government have committed US$ 4.7 million assistance to Pangani River Basin Management Project (PRBMP). PRBMP, a seven-year project started in 2003, was an initiative supported by he World Conservation Union (IUCN), the Netherlands Development Organisation (SNV) and a local NGO - PAMOJA Trust. Pangani Basin covers Lake Chala, Lake Jipe and Umba river, all shared with Kenya and occupying an area of 56,300 square kilometres.
31. UK government to provide $4.1 million to boost farm produce from East Africa: The British government announced a £2 million ($4.1 million) fund to boost the export of sustainably produced produce from Kenya, Uganda and Tanzania. The UK government's Food Retail Industry Challenge Fund (Frich) is aimed at trying to encourage British firms to buy more sustainably produced produce from Africa.
32. Germany to provide US$2 Million for food security and livelihoods projects in Tanzania and Kenya: The Government of Germany committed US$2 million to enhance the viability of smallholding and traditional agriculture and agro-pastoral systems and the food and nutritional security of the indigenous communities in Kenya and Tanzania, under an agreement signed with the Food and Agriculture Organization.
33. Tanzania’s principal five export destinations: Switzerland, South Africa, Germany, China, Kenya (followed by Netherlands, Japan, UK, UAE and India)
34. Tanzania’s principal five import sources: South Africa, Bahrain, UAE, China, Japan (India is sixth largest exporter to Tanzania)
35. The principal five export commodities
(Values in US$ million; figure in bracket indicates % share of the commodity)
Item |
2005 |
2006 |
Year ending October 2006 |
Year ending October 2007 |
% annual change |
Gold |
641.7 (41.9%) |
737.1(43.7%) |
757.3 |
777.1 (46.4%) |
2.6 |
Manufactured goods |
156.06(10.2%) |
195.6(11.6%) |
195.7 |
287.2 (17.2%) |
46.7 |
Fish & Fish Products |
146.88(9.6%) |
138.3(8.2%) |
133.6 |
143.2 (8.6%) |
7.2 |
Cotton |
111.69(7.3%) |
55.7 (3.3%) |
82.9 |
50.2 (16.7%) |
-39.5 |
Tobacco |
81.09(5.3%) |
65.8 (3.9%) |
62.4 |
75.9 (25.2%) |
21.6 |
Coffee |
74.97(4.9%) |
60.7(3.6%) |
57.9 |
98.9 (32.9%) |
71.0 |
Vegetable& oil seeds |
62.73(4.1%) |
47.2(2.8%) |
153.2 |
202.2 (4.3%) |
32.0 |
Other Minerals |
50.49(3.3%) |
50.6(3%) |
25.5 |
69.7 (5.9%) |
-- |
Cashew nuts |
45.90(3%) |
38.8(2.3%) |
61.9 |
28.7 (9.5%) |
-53.6 |
36. The principal five import commodities
(Values in US$ million; figure in bracket indicates % share of the commodity)
|
2004 |
2005 |
2006 |
One year period ending October 2006 |
One year period ending October 2007 |
% annual change |
Other Consumer Goods |
518.1(22.1% |
585.42(22%) |
602.8(15.6%) |
591.8 |
749.6 (6.4%) |
26.7 |
Machinery |
445.5(19%) |
532.20(20%) |
722.4(18.7%) |
664.5 |
887.4 (21.1%) |
33.5 |
Oil |
431.8(18.4%) |
510.91(19.2%) |
1146.5(29.7%) |
1,049.80 |
1,448.70 (34.4%) |
38 |
Transport equipment |
229(9.7%) |
290.05(10.9%) |
374.8(9.7%) |
385.8 |
448.5 (10.6%) |
16.2 |
Building & construction equipment |
185.5(7.9%) |
258.12(9.7%) |
338.0(8.7%) |
335.2 |
402.1 (9.5%) |
20 |
Industrial raw materials |
227(9.7%) |
255.46(9.6%) |
376.5(9.7%) |
352.2 |
434.2 (10.3%) |
23.3 |
Food & foodstuffs |
248.8(10.6) |
167.64(6.3%) |
249.2(6.5%) |
247.3 |
268.4 (6.4%) |
8.5 |
Fertilizers |
54.1(2.3%) |
63.86(2.4%) |
53.9(1.4%) |
51.7 |
57.5 (1.4%) |
11.1 |
Major economic and commercial developments in December 2007
37. EAC to spend US$1.8 billion on power plan: East African Community (EAC) partner states would spend about Shs2.07 trillion (US$1.8 billion) for the implementation of a power master plan in the next seven years. Out of the amount, some US$ 1.2 billion will be used for power generation while US$ 600m will be spent on power transmission projects.
38. Tanzania business representatives lobby for Return to Comesa: Members of the business community under the Tanzania Private Sector Foundation (TPSF), TCCIA and CTI, who have been lobbying for quite sometime for Tanzania’s return to the Common Market for Eastern and Southern Africa (Comesa), initiated a fresh debate on whether Tanzania should rejoin the block. Tanzania withdrew from COMESA in 2000 citing high membership cost.
39. According to a study commissioned by the Tanzania Private Sector Foundation, the Confederation of Tanzania Industries and the Tanzania Chamber of Commerce, Industry and Agriculture, as a result of withdrawing from Comesa, the country lost $60 million annually. While Tanzania had been neglecting these markets, Kenya exported $134 million's worth of goods to Egypt and $39 million to Sudan in 2006. The study observed that the Comesa Free Trade Area and Customs Union is much larger than the SADC zone - it has eight more countries - and therefore has more political weight in the African Union in spite of the economic might of South Africa. Even Malawi, Zimbabwe and Mauritius who are also members of SADC, The report said that Tanzanian membership of Comesa would enhance its political stature in East and Southern Africa region and facilitate rationalisation and harmonisation of programmes of Comesa, EAC and SADC.
40. According to the study, despite Tanzania’s remaining out of the bloc, trade between Tanzania and Comesa member states had been on the increase: Tanzania’s exports increased from $80.33 million in 2001 to $198.32 million in 2006 whereas imports shot up from $142 million to $245.30 million during the same period; and that COMESA was only the only regional trading block with which Tanzania enjoyed a trade surplus. The report indicated that Comesa was the cheapest bloc in terms of membership fees: Tanzania paid $3million in 2005 as EAC membership fee, $1.2 million for membership fees in the Southern African Development Community (Sadc), while it needed only $0.6 million for its Comesa membership.;
41. Licences given to 8 private container depots: Tanzania licensed eight private companies to operate inland container depots in an effort to decongest the Dar es Salaam Port Container Terminal. The eight operators are Tanzania Road Haulage; Mofed Tanzania Ltd; Malawi Cargo Centre Ltd; Kurasini Inland Container Depot; Ubungo Container Terminal; AMI Ltd; Dar es Salaam Inland Container Depot and East Cost Liquid Storage Ltd. The Dar es Salaam port's container cargo terminal had surpassed its installed capacity by 23.1 per cent, handling 307,791 twenty-foot equivalent units against its capacity of 250,000 units.
42. The Ministry of Infrastructure Development has allocated $41 million for development of TPA infrastructure and facilities during the 2007/08 financial years.
43. Tanzania’s fertilizer consumption one of the lowest in the world: According to recent studies, between 1996 and 2000 only six kilos of fertiliser were used in a hectare in Tanzania. The amount was less than 16 kilos used in a hectare in Malawi, 31.6 kilos in Kenya, 51 kilos in South Africa, 105 kilos in the US and 678 kilos in The Netherlands during the same period. Distribution problems and inadequate information of the actual demand for fertiliser was reported to be the stumbling blocks to the fertiliser use across Tanzania.
44. Tanzanian elected to head Air Navigation Commission of ICAO: A Tanzanian Mr Omari Rashid Nundu, the director of international affairs of the Tanzania Civil Aviation Authority (TCAA) was elected president of the Air Navigation Commission of the International Civil Aviation Organisation (ICAO) in Montreal, Canada. Nundu is the second aviation expert from Africa to hold this position in 60 years.
45. Rwanda removed work permits for EAC: Rwanda announced its plan to remove work permit requirements and employment restrictions on professionals for the East African member states-- Tanzania, Uganda, Kenya and Burundi.
46. Tanzania-Iran: Iran reportedly promised to help Tanzania to improve its agriculture sector, including utilization of underground water for irrigation, the production of fertiliser and supply of tractors. Iran also offered Tanzania to look into the possibility of supplying tractors at affordable terms ( Tanzania imported about 200 and 300 tractors a year, while annual demand was over 1,000).
47. Tanzania –Egypt : During the visit of Vice President Dr Shein to Egypt, the two sides agreed to cooperate in agriculture, industry, science and technology, and establish joint ventures in the mining sector. Egypt showed interest in buying meat from Tanzania, especially from the recently opened meat factory in Sumbawanga. Egypt also promised to help in training Tanzanian health personnel in cancer research and treatment; and help in rehabilitating Mnazi Mmoja Government Hospital in Zanzibar and build a hospital laboratory in the Isles.
India-Tanzania
48.Tanzanian participation in the Ministerial Conference on avian influenza: Hon’ble Anthony Daillo, Minister for Livestock Development, Government of Tanzania attended the Ministerial Conference on Avian and Pandemic Influenza held in New Delhi from 3-7 December 2007.
49. India's Royal Orchid to invest US$25 million in Tanzania to set up new hotel: According to media reports, Royal Orchid Hotels, a Bangalore based hotel group, would be making a foray in the international market with its plans to develop a 150-room beach resort over a 30-acre property in Dar-es-Salaam, Tanzania. The company would be investing $25 million to develop the resort, which is expected to start operations in 2010. The group bought the land through acquiring the holding company, Multi Hotels, for $2 million.