Industrialisation to transform Africa
Posted on :Friday , 28th November 2014
Africa industrialisation day is an annual event celebrated to showcase relevant actions and success stories that promote Africa’s industrial development.
The event will take place under the theme “Inclusive and sustainable industrial development (ISID): Agro-industrial development for food security.”
Also, African Union 2014 was designated as the year of Agriculture and Food Security, while the UN General Assembly has declared 2014 as the International Year of Family Farming.
Agriculture, which is one of the six selected critical areas for concentration under the Big Results Now (BRN) initiative, offer Tanzania and the continent an important activity with plenty of investment opportunities for long term and sustainable economic growth.
In his key note address at the BRN Investor Roadshow in Dar es Salaam last week, Deputy Minister for Finance and Economic Affairs, Mr Adam Malima, underscored the need to attract and execute agriculture projects under the Public-Private Partnerships arrangements.
Mr Malima, who recently served the ministry of agriculture, food security and cooperatives, insisted on agro processing activities as the platform that could liberate rural populations from hunger and poverty. He said value addition through agro processing could stimulate rural economy.
It may attract related and supporting investments in roads, health services, electricity, financial institutions and schools, all of which are geared at improving living standards.
“When all these are pursued where farming activities are executed, it will have multiplier effects in terms of wealth creations to the rural population thus contributing significantly to economic growth,” he said.
The construction of manufacturing facilities in the rural areas may form an important platform in job creations from the initial stage of the project implementations and more over when it takeoff. He insisted that the rural areas may remain sources of raw materials if the aspect is ignored.
The BRN initiatives identified further that the agro-processing industries entailed adding value and improvement of standards and quality. Agriculture in Tanzania is dominated by primary production with negligible value adding especially at farm level.
Many farmers sell their produce unprocessed, leading to the majority obtaining low prices. Losses too, are sometimes high especially for perishable crops as they may not be stored for a long time in their raw form.
The agro processing would increase rural incomes by adding values to products. Processing also increases the shelf life of products thus offering more marketing opportunities, as the commodities may be stored for a longer period.
Agro processing too offers alternate employment opportunities thereby contributing to poverty alleviation, having potential areas like Fruit and Vegetable processing.
There is significant potential for investment in large scale farming and processing of fruit and vegetables for the local as well as export market.
A Large variety of fruits and vegetables are produced in the country. The most important fruits include mangos, oranges, pineapples, passions fruits, bananas, avocados, jackfruits, papayas, peaches, pears, guavas and grapes. According to statistics, 2.75 million tonnes of fruits and vegetables produced annually only 4 per cent is processed.
Some of the vegetables include tomatoes, okra, chilies. Another area of potential investments is Cashew nut Processing, which is one of the major cash crops grown in Tanzania and production has been raised to 120, 000 tones annually. Only about 10 per cent of the cashew nut produced within the country is processed.
Processing may carried out by rehabilitation the old plants or by establishing some medium scale processing plants. Also, Tanzania still imports a lot of edible oil, thus processing of oil seeds locally is important to capture the huge market.
The common oilseeds produced in the country include sunflower, simsim, ground nuts and palm oils. Textile and apparel offers the huge potential for exports.
Tanzania produces abundant cotton and exports more than 80 per cent in raw and only 20 per cent is locally processed. The sector has great investment potential in establishing full integrated textile mills as well as plants for cotton ginning, yarn and fabric production (spinning, weaving and printing) and cut, make and trim (CMT) units.
Another critical area with that offers lucrative investment potentials is the Leather Sector. Tanzania has a large livestock population (17.7m cattle, 12.5m goats and 3.5m sheep) and produces about 2.6 million pieces of raw hides and skins annually. A large portion is exported raw and only 10 per cent is processed.
Investment opportunities in the leather sector include establishment of modern tanneries and leather finishing production unit. Given as a large livestock population, the country is ideal for meat processing, packaging and processing of dairy products.
Potential export markets are the United Arab Emirates, including the other Gulf States and Asia. Investment opportunities in this sub-sector include establishment of meat processing plants, dairy products processing plants and cattle-attending ranches.
Therefore, Africa industrialisation day is an important opportunity to ponder on how to attract and channel investments to the sectors that have never been given priority, but could impact greatly on the transformation of the society in the journey to middle income country.
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