PRIME MINISTER Mizengo Pinda said Africa should do everything possible to do away from the tradition of exporting low value produce and instead, develop a culture of exporting value added products.He made the remarks this morning (Wednesday, May 11, 2011) when opening the Africa Free Zones Association (AFZA) 2011 Convention held at Mlimani City Conference Centre in Dar es Salaam. This the second convention and it’s the first time to be held in Tanzania.
He said Africa is abundantly endowed with natural resources and most of them are still under-exploited whereas some are yet to be touched due poor infrastructure, inadequate capital and unavailability and inappropriate technologies. “As a result, Africa has remained a producer and an exporter of raw agricultural products and minerals while importing value added products for domestic consumption,” he added.
“This trend has to be reversed if we are to develop this continent. … We must move aware from the syndrome of producing what we do not consume and consume what we do not produce,” he stressed.
He said that one of the avenues to reverse this trend was to use Free Zones or Export Processing Zones in which better infrastructure and incentives are provided to investors. The incentives are meant to promote export-oriented manufacturing investments and thereby promoting value addition.
“African countries will never develop without industrialization. Developed countries in the world started with agricultural revolution, moved very fast to industrial revolution by adding value to the agricultural and other resources and have now moved to industries and services. This should be our way forward!” he stressed.
Elaborating on the performance by the Tanzania Export Processing Zones Authority (EPZA) which was established in 2006, the Premier said that it coordinates the export processing zones and special economic zones schemes.
He said despite being in operation for only four years, EPZA with the support of the Government and other stakeholders, has made several strides in terms of attracting investments, generating employment and fast-tracking the industrialization process in Tanzania.
“Currently, there are 44 companies operating in these economic zones. Out of the 44 companies, 19 are local companies, 18 are foreign companies and seven are owned under joint ventures. These companies have invested in agro-processing, mineral processing, textiles and light assembling Industries. They have invested an amount estimated at USD 640 million generating 11,512 direct jobs and exported goods worth over USD 350 million,” he said.
In order to attract investors in these zones, Hon. Pinda said the establishment of infrastructural systems such as electricity, water, roads and godowns is a necessary prerequisite.
“This is a very expensive undertaking for a country like Tanzania. However, we are facing this challenge head-on. In this regard, the Government has continued to allocated land in 17 regions where it intends to develop basic infrastructure step by step in collaboration with the private sector,” he said.
Responding to questions raised by journalists just after opening the meeting, the Premier said there is a need by the African Union Heads of States to forge a common platform that will ensure the development of Export Processing Zones as means of boosting the African economy.
“In order to boost the economy regionally, they should ensure that these Free Zones and Export Processing Zones are strategically formed just like the regional economic groupings such as SADC, EAC and ECOWAS,” he said.
Commenting on availability of electricity in the country as one pillar of investment attraction, Hon. Pinda said the process is still ongoing but he made it quite clear that water was also a necessity.
“The Government is currently looking on the possibility of exploring underground water as an alternative source of this vital commodity. We want to do away with the dependence on Ruvu river as the only source of water for Dar es salaam city,” he added.
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