Investors in Lake Zone say govt delivering on results

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From a Mosses Ferdinand in Mwanza

Last month’s personal participation of Minister of State in Prime Minister’s Office (Investment) Angellah Kairuki and Deputy Finance and Planning Minister  Ashatu Kijaji,  in public-private sector consultative meetings in Mara, Simiyu, Shinyanga and Mwanza regions has had a very positive impact on the business community in the lake zone because private sector delegates said  the government was delivering on results.

In all meetings taxes and levies, interest on loans, were issues onthe lips of delegates. Land --- more so its acquisition --- which usedto take the centre stage in such meetings is no longer as prickly and itchy as it used; not even red tape!

Delegates from the hospitality industry gave example of ‘bed charge’ which they said become a tax when money was going to the Tanzania Revenue Authority (TRA) and become a levy when money for the same bed
was going to district councils.

“We own up to that corrosive grievance,” said Ms Kairuki calmly, but assured delegates such grievances were on their way out. The government was determined to make the investment climate better and better, she said, adding that the fifth phase government under President John Pombe Magufuli walks its talk.

Dr Kijaji, minced no words; she was candid,  telling financial institutions to make soul-searching. “Re-asses yourselves. In the past the government was lending banks at an interest rate of 16 percent.
The Bank of Tanzania is now giving loans at an interest rate of 7 percent and you are charging borrowers over 16 percent. This is wrong,” she told banks.

In an awakening scenario, she gave the example of the role SUMA JKT currently plays in the construction industry. “The government wants to build a building. The charges of a private company are prohibitive.

The charges of SUMA JKT are usually less than half of the charges of a private contractor. The government has no option but to use SUMA JKT,” she told delegates.

Dr Kijaji said unless commercial banks re-assessed themselves, the government might be forced to use banks like the Tanzania Postal Bank(TPB) and the National Bank of Commerce (NBC) to give loans to the
bulk of borrowers in the same way it is using SUMA JKT in the Land, the ministers were told, was no longer a headache to prospective investors because investors secured land titles inside 30 days.

Dr Kijaji also revealed that some micro-finance institutions were preying on retirees.  Such institutions were risking stiff government action.

She explained that  a retiree would borrow one m/- from a micro-finance institution to chase retirement benefits. When the retiree would get benefits, say after one or two years, the financial institution would demand its principal one m/- and interest cunningly calculated --- sometime to a tune of ten million. “We are studying
activities of such institutions.  Culprits will be struck off the list,” she warned.


Mr Daniel Ndaki, told the conference in Musoma that because the current government was true to its promises,  many of the challenges raised were resolved right  in the consultative meetings.

Ms Josephine Wambura, who spoke bitterly about  the issue of taxes and levies in the hospitality industry, said she was happy to be assured by the minister that the government was still studying the list of the remaining taxes and levies to assess their applicability in the present situation.

The Rand Merchant Bank in its 2018 edition entitled ‘Where to Invest in Africa’ ranked Tanzania as one of the top ten exciting investment destinations.   The bank assessed the economic outlook and investment opportunities in Africa, slotting Tanzania into the seventh position.

Ends.


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