Tanzania Gas Discoveries Help Attract Investors

Posted on : Wednesday , 1st July 2015

Dar es Salaam — Tanzania's Foreign Direct Investment (FDI) has risen by 14.5%, thanks to gas discoveries in the country including Songo Songo (below) writes LEONARD MAGOMBA.

According to newly launched World Investment Report 2015, the growth makes Tanzania, the leading FDI's destination in the East African Community (EAC).

However, the report indicates that Global FDI inflows in 2014 fell by 16% to $1.2 trillion, mostly because of the fragility of the global economy, policy uncertainty for investors and elevated geographical risks.

Speaking on behalf of The Minister for Investment and Empowerment, Eng. Christopher Chiza at the launching ceremony of the report held in Dar es Salaam last week the Permanent Secretary in the Prime Minister's Office, Dr. Flolence Turuka, said the country's FDI inflows represented its highest level in 2014 given that it attracted slightly $ 2,142 million compared to its last peak of $2,131 million in 2013.

"This amount is significantly higher than the very low level of $640 million between 2005-2007 (pre-crisis).This achievements is due to gas discoveries in Tanzania. Indeed, Tanzania once again is the leading FDI's destination in the East African Community," proudly announced the Minister.

According to the report Uganda registered $1.147 billion in FDI last year; Kenya received $989 million in FDI while Rwanda and Burundi came fourth and fifth with FDIs to the tune of $268 million and $32 million respectively.

Further the report mentioned South Africa as the Africa's largest recipient of FDI in 2014 with inward FDI Stock of $145,384 million while also mentioning China as the largest recipient of FDI in 2014, followed by Hon Kong (China) and the United States of America.

Developing economies as a group attracted $681 billion worth of FDI with a 2% rise, thus the countries are currently account for 55% of global inflows, according to the report.

It further mentioned that among the top 10 FDI recipient in the world, half are developing economies; Brazil, Hong Kong (China), India and Singapore.

"In this light, strengthening the global investment policy environment, including both the International Investment Agreements (IIA) and the international tax regimes, must be a priority," he said.

Giving opening remarks at the ceremony, the Tanzania Investment Centre (TIC) Board Chairman, Prof. Lucian Msambichaka congratulated the UNCTAD for the important report and the Government of Tanzania through Tanzania Investment Center (TIC) for their efforts to promote, facilitate and reducing restrictions on investments.

"I am confident that the United Nations in Tanzania, and UNCTAD and UNDP Tanzania in particular, will stand ready to continue to support the Tanzanian government more broadly with both strategic policy advise as well as more practical guidance based on global good practices as the country seeks to implement the New Economic Model and achieve Vision 2020" he said.

He further added that more work needs to be done to attract investment into other sectors that have greater propensity to attract job such as manufacturing and agriculture.

"Ethiopia and Mozambique are countries that we have a lot to learn from. Ethiopia FDI's has surged on its improved performance of textile manufacturing. Mozambique has done well in gas and has been a star performer in attracting FDI in the SADC region," he said.